If you hang around the personal finance world long enough, you’ll discover a massive debate. This debate about whether or not paying off your mortgage early is a good idea or not. If you’re new here, my family became 100% debt-free in January of 2019 when we paid off our mortgage early.
To give you a quick background on us, my husband and I are 34 and 33 years old and we have 3 children. We have no debts and no credit cards. We live off my husband’s income which is right at $50,000 a year and live in Metro Atlanta. I am a stay-at-home mom to our kiddos. It took us 6 years to become 100% debt-free.
I don’t share that with you to impress you. I share this with you so know that we don’t come from money and that my husband does not make six-figures. Achieving this feat happened through many years and tireless days of working together to achieve financial success.
So, was it worth it? Was it worth it to pay off our home early instead of taking the additional money created in our budget by no longer having minimum payments and investing it instead? Is paying off your mortgage worth it to you?
The short answer, yes.
Our paid-for home…
Why pay off your mortgage early?
Here’s the thing. I can’t tell you why you should pay off your mortgage early. However, I can tell you why we paid ours off. Once we became consumer debt-free and had saved up a six-month emergency fund, we realized that if we hustled we could kill off our mortgage quickly. Of course, when we decided to go this route, we heard from everyone about “dumb” this idea was. We heard how we should be investing the money instead so we can earn interest on it.
Ultimately we decided that paying off the mortgage made the most sense. By freeing us from our mortgage payment every month, we could create more room in our budget for investing. Because the thing is, living off one-income still meant that there was no way we’d be able to max out two IRA contributions if we still had a mortgage payment.
The added bonus is one that my husband wanted. My husband loves that if something happened to him, his wife and children would not have to worry about their home being taken away from them. By not having a mortgage payment, it frees me from having to stress to run out and take the first job offer. It allows me time to be with my children during a time of transition. It allows me time to find the right job opportunity. The Emergency Fund can stretch even further because there is no mortgage payment to worry with.
Why math isn’t all it’s cracked up to be.
I have an Accounting Degree from one of the top-ranked Accounting schools in the Southeast. I fully understand how math works and how math plays out in regards to our finances. However, the math doesn’t always work in real life. I mean, how many times did we say that in high school? How what the textbooks said didn’t match actual life?
That’s because, while the math is important, it cannot factor in your behavior or lifestyle. For instance, if you struggle with self-discipline and constantly overspend, then chances are, you are not following the rules of the math. After all, if you spend more than you make, then you don’t have any money. And yet, many of us do exactly that. We spend more and more and then wonder why we ended up deep in debt. Or at least I know that’s what happened with us.
We claim that the gold is in the math but it’s really in our behaviors. If we don’t manage our money well then there’s no amount of math that will fix it.
Freedom is freeing.
Not having a mortgage payment any more – or any debts payments – allows us the freedom to use our money as we please. We are no longer chained to paying for our overspending or past purchases. We are free to spend our money as we wish. And when it comes to giving, it is such a beautiful thing to be able to give money away without fear.
Being able to live life on your terms is incredibly freeing. Unfortunately, too many people stay chained to debt waiting on the math to work without changing their behaviors. Not having the stress of debt and a mortgage over our heads has been incredibly freeing and has allowed us to save for retirement in a way we would not otherwise be able too.
Our paid-in-cash camper…
The Debt-Free Lifestyle
I get it. The debt-free lifestyle isn’t for everyone. After all, we’ve all been sold this idea of relying on debt to live since we were kids. We don’t understand how life can happen without debt. Oh, but it can my dear friend. My family is living proof that you do not need to be in debt in order to live an incredible life.
Since becoming debt-free my family has been able to:
- Go on several paid-for family vacations every year.
- Purchase 3 vehicles in cash.
- Purchase a fifth-wheel camper in cash.
- Pay for several health emergencies in cash.
- Support needy local families financially.
- And so much more!
The thing is, you don’t have to live your life in a series of payments. You can live your life free. That my friends is the best part of living debt-free and paying off your mortgage early.
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Great motivating post! I agree that paying off debt or not incurring anymore debit is definitely a mindset more than math. Thanks for sharing your story at #HomeMattersParty I look forward to reading more from you.