Mortgage Payoff


Brad Barrett discusses several strategies and perspectives regarding the payoff of mortgages on his podcast, "ChooseFI."

  1. Benefits of Paying Off the Mortgage:

    • Paying off your mortgage can act as a hedge against sequence of return risks and other unpredictables in life (1).
    • They discuss the psychological comfort and financial flexibility gained from not having a mortgage payment, which can allow more freedom in investing future cash flows (1).
  2. Weighing Investment vs. Mortgage Payoff:

    • In one approach, some prefer to invest the money that could be used to pay down the mortgage more quickly, betting that the returns from investments will exceed the interest savings from an early payoff (2).
    • Barrett delves into the psychological and financial strategy of having funds available that could pay off the mortgage without actually using them immediately for that purpose, thus benefiting from potential investment returns (3).

      Paying off Mortgage

      Jonathan and Brad discuss the benefits of paying off a mortgage, including reducing unknown variables and susceptibility to market shocks, and having the option to invest the new cash flow as desired. They read a comment from Nick, who paid off his mortgage in three and a half years and has no regrets.


      068R | 2 Worlds Collide
  3. Psychological Impacts:

    • The security and reduced financial burden of having no mortgage debt are emphasized, even if the mathematical advantage might suggest otherwise—to have funds in investments which might earn more than the mortgage costs (3).

To sum up, the decision to pay off a mortgage early on Brad Barrett's podcast "ChooseFI" is often discussed not just from a numerical perspective but also considering psychological comfort, life risks, and future investment opportunities.