12 Good Reasons Why You Should (and Shouldn’t) Pay Off Your Mortgage Early

Do I think it’s wise for you to pay off your mortgage early?

You may as well ask me if I think it is a good idea if you paint your living room sage green.

For many years I believed that paying off your mortgagewas an absolute no-brainer.

Then I did a complete 180, changing direction like one of those day-glo orange heliport windsocks.

After resurveying the macroeconomic condition of the United States and trying to interpret the future direction of its fiscal policy, I was ready to declare that maybe, just maybe, prepaying the mortgage isn’t a good idea after all.

Suddenly it just didn’t seem like it made much sense to pay down a 30-year $120,000 mortgage at 3.5% interest if I truly believed that high-inflation was inevitable down the road as a result of Fed’s relentlessly lax monetary policy.

The question of whether or not I think you should pay off your mortgage is not as cut-and-dried as, say, whether or not I think you should pay off your credit card balances in full each month. Of course you should pay off your credit cards in full each month; but when it comes to paying off the mortgage early, there are solid arguments that can be made either way.

Here are 12 good reasons why you should — and should not — pay off your mortgage early. Which ones resonate most with you?

Good Reasons Why You SHOULDN’T Pay Off Your Mortgage Early

1. You haven’t capitalized on your employer’s retirement plan company match.

If you’re not contributing to a 401(k) retirement plan where your employer offers a dollar-for-dollar match on, say, the first 3% of your contributions, then you may want to reconsider — by not taking advantage of that matching contribution, you’re essentially leaving free money on the table.

2. You have debt at a higher rate than your mortgage.

It makes no sense to pay off a mortgage if you’re carrying credit card debt at a higher interest rate. When you pay off a credit card with a 15% interest rate, then every dollar of debt you pay off earns you an instant 15% return.

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