Why You Should Focus On Paying Down The Mortgage Over Investing

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[JeremiahParker-]

The problem we have is because Most people always taught that " you only need a good job to become rich. These billionaires are operating on a whole other playbook that many don't even know exists.

[JRInTroy]

I’m paying off my mortgage this month. Single female 45. Yas.

[willywonkaxx]

I paid off my house when I was 39. I'm 52 now. It was the best investment I ever made...in terms of emotional health and financial stability. We have been debt free since...we live in California so not a cheap place and my Wife was a sahm...what did we give up to do it? New cars, eating out, fancy vacations and so on...now we have newer cars, eat out often, have great vacations, and a secure retirement. My peers, who thought we were nuts driving those beat up cars, are STILL paying on their houses and can't afford to do what we do...so, save early and avoid debt early for a nice long term life!

[nemishasharma]

A year and a half ago I came across Dave on YouTube. Yesterday I paid off my house, and all my other debts are long gone. 30 years old. Thankful for Dave.

[BrewersArcade]

We are two months away from paying off our mortgage. It’s worth the challenge guys. Age 39 and debt free with three kiddos.

[blr]

So the message Dave is trying to send here is: yes you can mathematically earn more money by aggressively investing more while paying down your mortgage. However, history has shown us that human nature and unpredictability is more powerful than mathematical equations. You may lose your job, or go through some kind of financial crisis. You would rather have that house paid off rather than trying to cash out your investments during a financial downturn. Life is unpredictable, so paying off your debts give you a peace of mind.

[ranep]

For newbies, be aware that this is a grossly oversimplified scenario. For one thing, you can't get a mortgage on an investment property without at least 25% down payment. Two, it's easy to see comps for house purchase prices, but it takes a lot of research to understand the comps on rent prices. The trick is to find a place where renting is more expensive than buying, but those places are less common because of this very type of scenario. Three, you have to remember that rent number he's using is supposed to be net income, not gross. So you have to think about costs for taxes, insurance, maintenance and vacancy when you're researching investments. All that said, real estate investing is a good tool for wealth accumulation. But it isn't foolproof.

[spursnation]

I just paid off my mortgage in less than 15 years and I just turned 49, such a great feeling not having a mortgage anymore!!!!

[nathanielcarreon]

Paid off mine in ten years and retired 10 years earlier than usual.

[lynnebucher]

I had to make this decision also. I did a hybrid approach, maxed qualified retirement savings, cut unnecessary spending, and threw everything else at the 6.25% mortgage. I definitely noticed that during the Great Recession, those with paid off house who lost their good job could take any low paying position and still pay bills.

[ralphbernhard]

We paid off our house asap.
It was paid off by the time I was 35.
Nothing is more valuable than "peace of mind".
No obligations.
No debt.
That is real freedom.

[j.r.f]

Just paid off my mortgage of $179K today and had some reservations about it. I earn quite a bit and one of my businesses just underwent acquisition so I came into a large chunk of cash. Everyone was telling me to invest in the S&P, instead of paying off my mortgage, etc.. Sigh.. thanks for reaffirming me. Now I am 100% debt free. 29 married male.

[YakMotley]

I paid my home off immediately! The big key to this argument for me was PEACE OF MIND! I have never had more peace of mind than when I paid off my mortgage. The rate of return on a paid off home is A LOT! Way more than nickle and diming a few percent!

[oliviaralston]

Successful people don't become that way overnight. What most people see as a glance of wealth, a great career, and purpose is the result of hard work and hustle over time. I pray that anyone who is reading this will be successful in life...

[harrisonjamie]

I admire the financial independence of people, But you can live better if you work a little more. After watching this I think there are people out there, on the extreme, who plan to die early just to be able to retire early. To each their own but to me, retirement isn't just about not having to work, it's about having the freedom to do whatever you might reasonably want, such as travel, buying things, enjoying life, etc. I don't think I could retire with less than $3m in income-generating investments, maybe $2m at the very minimum. I plan to work until I'm at least 45

[jimroscovius]

We paid off our house and are investing like crazy!! It's a great feeling not having that debt.

[danielaltherr]

This guy is killing it! Good for him! Dave, great advice! You have changed mine and my wife's life. We are 30 and 28 years old and just got our house paid off. No inheritance or anything. Just hard work. Keep up the good work Dave!

[larhondah.]

We purchased our home 10 months ago and plan on paying it off in 10-15 years. God willing once I retire from the military. I'll be 45 and my husband 53!

[otreborfashionscene]

I paid off my house 4 years ago, am 60 didn't had a good paying job until 8 years ago, I have saved 100k in IRA retirement in 6 years, I wish I started earlier, but all of my jobs were almost minimum wage, I got this job by the grace of God and looking forward to retire at And no children to take care of.

[agathacolleen]

I will be forever grateful to you, you changed my entire life and I will continue to preach on your behalf for the whole world to hear you saved me from huge financial debt with just a small investment, thank you Charlotte Miller.