Reply #29: What I would do [View All]

[jmowreader]

I assume you ran into some money, enough to retire your mortgage, and you're trying to decide what to do with it.

I would:

a) Retire my mortgage.
b) Any money that's left after the mortgage is gone gets invested.
c) Now, invest your house payment. You still make a payment in the amount of your mortgage installment, but instead of sending it to the mortgage company, send it to whatever investment you have chosen.
d) If you're tax-averse, and you're using your mortgage as a tax deduction, open a savings account. Sit down with your 1040 and do a what-if calculation: first run your taxes with your mortgage interest deduction. Now zero the deduction out and run your taxes again. Subtract the with-interest tax bill from the without-interest tax bill, divide by twelve, and deposit that much money into the savings account every month. At tax time, if you owe the IRS anything use the money in savings to pay it. (If you will receive a refund, just smile and think "I have a nice little nest egg.")