272: Finance Friday: Should You Pay Off Your Mortgage Early or Invest?

Ahh, the age-old question: pay off your mortgage early or invest? It’s no wonder so many members of the financial independence community have strong feelings about one or the other. With a paid-off mortgage, you’re less in debt, with more free cash to invest or spend on things you love doing. But, there’s another side to that cash flow coin. If you’re paying off your mortgage early, you’ll have less money to invest, leaving you with less compound interest. 

If you’ve been asking for someone to answer this question for you, be sure to thank today’s guest, Javier. He’s been doing a phenomenal job paying down his mortgage as quickly as he can, especially at such a young age. Javier has a respectable net worth and works not only at his W2 but also as a real estate agent on the side. Javier is struggling to find where to best put his extra $1,300/month once he pays off his primary residence.

And while this is a BiggerPockets Podcast episode, Scott and Mindy do not immediately vouch for real estate investing. Instead, they take a look at his overall risk tolerance, personal finance situation, and work backwards from his goals to find what he really wants out of early retirement, instead of just grasping for cash. 

In This Episode We Cover
Setting up your “bare-bones emergency fund” so you can invest with confidence 
Whether or not you should pay off your mortgage early 
When the right time to leave your W2 job is and pursue your side income streams
How to pay for healthcare when you’re self-employed or without work subsidies 
How much to allocate towards taxes per month as a self-employed individual 
When real estate investing does and does not make sense for your lifestyle
And So Much More!

Learn more about your ad choices. Visit megaphone.fm/adchoices

Ahh, the age-old question: pay off your mortgage early or invest? It’s no wonder so many members of the financial independence community have strong feelings about one or the other. With a paid-off mortgage, you’re less in debt, with more free cash to invest or spend on things you love doing. But, there’s another side to that cash flow coin. If you’re paying off your mortgage early, you’ll have less money to invest, leaving you with less compound interest. 

If you’ve been asking for someone to answer this question for you, be sure to thank today’s guest, Javier. He’s been doing a phenomenal job paying down his mortgage as quickly as he can, especially at such a young age. Javier has a respectable net worth and works not only at his W2 but also as a real estate agent on the side. Javier is struggling to find where to best put his extra $1,300/month once he pays off his primary residence.

And while this is a BiggerPockets Podcast episode, Scott and Mindy do not immediately vouch for real estate investing. Instead, they take a look at his overall risk tolerance, personal finance situation, and work backwards from his goals to find what he really wants out of early retirement, instead of just grasping for cash. 

In This Episode We Cover

Setting up your “bare-bones emergency fund” so you can invest with confidence 

Whether or not you should pay off your mortgage early 

When the right time to leave your W2 job is and pursue your side income streams

How to pay for healthcare when you’re self-employed or without work subsidies 

How much to allocate towards taxes per month as a self-employed individual 

When real estate investing does and does not make sense for your lifestyle

And So Much More!

Learn more about your ad choices. Visit megaphone.fm/adchoices