Currently have a 650k mortgage. TC is 350k. After listening to Dave Ramsey I’m thinking about using all my RSUs as they vest to pay off mortgage principal at a faster pace for peace of mind. I should be able to pay off the house fully in 5 years. I already have 1 million saved in a brokeage account and another 800k in retirement savings. I’m 40 and married with a kid. I’m mostly ok with my job, but I don’t see myself getting promoted anytime soon and I’m getting tired of office politics and playing the perf game. I work in a small remote office in the midwest (think Chicago suburbs, Madison or Ann Arbor) with little chance for advancement, but the cost of living is very reasonable so my living situation is great (live in a big house on the lake). Work can be meh with a few bright spots here and there. Mostly working over video with people in Mountain View and flying out quarterly. Google is pretty much my only high paying option here, thus I’m eager to get rid of my debt since job isn’t guaranteed forever. Any thoughts on what to do? Pay off mortage with RSUs or put it in a rainy day account?
Mortgage rates are so low, I think it’s hard to justify locking up all that capital in equity. Even basic investments such as index funds will return 6+% (conservatively). But I also understand wanting the piece of mind of not having the payment, especially in the market you’re in. At most I’d consider splitting the difference somewhere so that I can get my payment low enough that any job will handle it. I’d then invest the rest in other, higher return options. Btw, nice job getting the $1M + $800K racked up!
Working at google with 350k Tc you don’t need a piece of mind. Just put in 100k max and relax, you are 1%!
If you owned your home free and clear, would you take out a heloc in order to be able to purchase stock? There’s your answer.
I have been asking myself the same question. I work at Amazon and will be getting a vest soon and planning to pay off final debt in baby step 2. Will sell my old house near previous employer and use that with upcoming vest to put down payment on new property. But I’ve been asking myself, what’s the right pace to pay off the mortgage. In his book total money makeover, he mentions he knows a lot of people who retired, paid off the house, and are broke. Need to find a plan for the right pace.
Yes, 20% down into the house. Foolishly put another 250k into renovating the house. It’s been a money pit, though great location in a coveted spot on the lake. Regarding saving, worked in the Bay Area for years and lived like a student (had roommates, didn’t have any expensive hobbies, bought a condo in the right place after the market crash, etc., but honestly had a really dull time in my 20s and I should have enjoyed myself more). Only recently transferred to a remote office after getting priced out of the bay area and wanted something new since my career was stagnant.
Dave Ramsey is for the lowest common denominator; not you. Take the free money instead.
Since you have 1mil in brokerage, I would just pay it off. Still leaves u with 350 liquid. And then you just start dumping what used to be your mortgage into mutual funds or ETFs. Congrats on basically being set financially.
Refinance for a lower rate or just stick with current. Dave Ramsey’s audience is not op, and incurring taxes on ops investments to pay off what’s probably already low interest debt is an insanely stupid proposal.
Financially speaking playing the market atm is the better choice but I'm a Ramsey follower and if the economy tanks tomorrow I want to know that it's not taking everything I own with it. So I'm counter the rest of the posts and I'd pay it off. Be debt and worry free and invest the rest (in diverse markets).
I’m also debt free but I do that by not owning a house. If one is in the ridiculously awesome position op is in, and decides to own a house, paying it off is a silly thing to do when mortgage rates are much lower than returns in the market. Op has a loooong safe period. Basically, Dave Ramsey’s advice is not targeted for a 6 figure audience with good spending habits.
^this
Are you T5? Can you give me referral, I want to live in the house on the lake too lol