If you got your mortgage around 10 years ago, when mortgage rates were really low, you should reconsider.
For one thing, today you can earn more interest from a savings account than you pay for your mortgage.
For another, you forfeit the tax deduction that comes when you pay mortgage interest. So you could end up paying much more at tax time.
Based on today's interest rates, every $10,000 reduction in your mortgage principal saves you only a little more than $60. You can save more than that by paying other, higher interest rate, loans first.
Like your car loan for example, for which you could be paying 5.94 APR. Or credit card interest, which averages 28.17%.
Instead, you might want to invest your money in a savings account, which can pay as much a 7%, or a mutual fund. In addition to the advantage of earning more money, this has the added advantage of keeping your money liquid. Which you may need for several expenses down the road.
For example, even if your home is fully paid for, maintaining it isn't. You may need a new roof, HVAC, electrical wiring, plumbing, new appliances. Or you may need to pay for unexpected expenses – anything from major can repairs to medical expenses and hospitalization, which your insurance may not cover all of.
And you'll also need to pay for food, utilities, gas, groceries, etc. A 2022 survey found that 76% of Americans were stressed out by the rising cost of those items. While it feels good to have a home that's finally paid for, your house can't feed you if you're hungry.
One other way of preserving money is not paying for care services you don't need. Unlike some services, which only offer package plans, Senior Insights first conducts a detailed survey of you and your family. This survey covers everything from your physical, psychosocial, and mental status to your hobbies, interests, activities, and social life.
Then, we custom-design a care plan based on your unique needs, maximizing your quality of life and independence.
Please contact us to see what a difference that can make.