Mortgage Pay off vs. Investments?

[anniesva]

We have a 13 years left of a 15 year mortgage which we pay extra to each month and are on track to retire the debt in 10 years. We also systematically put money to various investments each month. If we commit the investment money to the mortgage instead we can pay off the mortgage in 3 years. Should we stop pur investment savings to pay off the mortgage and save 7 years of interest? The note is currently $220,000 at 5%apr

[Oneeyedvic]

Undoubtably, you should never (okay, very occassionally) invest any money money until you have no debt.

[Miss Zippy]

Agree - the best financial advisers will tell you to clear all your debts, including your mortgage, before making any substantial investments. However, you should always make sure you have some cash funds put by for emergencies - generally 6-12 months' worth of your salary is the recommended amount you should have in cash savings.

[mash]

Not necessarily true. If you are paying 5% on you debt and your investments return above this annuallly why get rid of them, you are making money? So compare you current investment returns agaist your debt. A business who does not use debt or holds cash is seen as lacking vision, it can be viewed in the same way by individuals. The main reasons to remove debt are piece of mind, no where to invest effectively or to offer great investment choice. As for holding 6-12 months of money at all times, this is reassuring but ineffecient.