Should You Pay Off Your Mortgage Now?
Considerations to help you determine if you should pay off your mortgage early.
If you’ve ever compared the purchase price of your home with the amount you will actually end up spending by the time you’ve paid your mortgage off, then you know that the difference is staggering. This naturally brings up the question: Should I pay off my mortgage early to avoid interest? While it’s an appealing thought, the reality is that you may not be able to undertake this major financial investment. Here are some of the things you need to consider when thinking about this decision.
Calculate Monetary Returns
From a purely mathematical perspective, most financial experts agree that it’s not a great idea to pay off your mortgage early. This is because federal interest rates are currently at a historic low, making your mortgage one of the cheapest loans you’ll ever take out. Logically, continuing to make your monthly mortgage payments and investing the money you would have used to pay it off completely is likely to result in a larger financial gain.
However, there are some benefits associated with paying off your mortgage early. To start, it gives you the peace of mind that comes from knowing that you truly own your home. Additionally, when you don’t have a significant chunk of your income going towards your mortgage, your cash flow increases and your financial responsibilities decrease. If you got laid off, had a medical emergency, or experienced some other change that put a strain on your finances, then you would not have the added worry of making your mortgage payments on time.
These are some of the major things you should consider as you decide whether you should pay off your mortgage early. Whatever you decide, it’s important that you have the right insurance protections in place to keep your home safe. For assistance with your homeowners insurance, contact the experts at Club Agency Insurance Brokerage in Garden City, New York. Our dedicated team is ready to get you the coverage that you need today.