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I'm not sure how sound this is financially, but I've reached the point where the interest portion of my mortgage payment is

Posted by mara Dec 14 '22, 06:47

the equivalent of 3.5% annually. So I'm going to stop making extra principal payments, and put that money in a savings account with 3.6% interest.

Does this make any sense? It's not a huge amount of money, so it won't make much difference, but I feel like it's a good time to reallocate the cash.

Responses:

paying principle down means making fewer payments, you'll feel NOT making a mortgage payment more than noticing an extra dollar in your savings -- nm - zeitgeist Dec 14, 10:43
It mostly depends on what you intend to do with the extra cash. Possible uses: - rollo Dec 14, 08:02 7
- The extra cash goes into a high-interest savings account (currently 3.6). -- nm - mara Dec 14, 08:10 5
  - yes but toward what eventuality? -- nm - rollo Dec 14, 08:16 4
    - mo money - Spawn Dec 14, 08:35
    - more interesting things, rollo. it's right there. -- nm - Max Dec 14, 08:26
    - world domination -- nm - decline Dec 14, 08:18
    - Hookers and crack -- nm - znufrii Dec 14, 08:17
- 4)Get Van Halen to play your next birthday party -- nm - decline Dec 14, 08:04
If you’re on a fixed rate mortgage at 3.5%, I would not be paying down any extra principal right now. -- (edited) - znufrii Dec 14, 06:53 5
- I certainly get it, but I also like the psychological benefit I get by paying off my mortgage early. -- nm - Dano Claus Dec 14, 07:17 2
  - Yup. That’s why I framed it as a question of what *I* would do. :) -- nm - znufrii Dec 14, 07:20
  - Yeah, that's where I was too. And why I was looking for a financial reason to stop. :-) -- nm - mara Dec 14, 07:19
- That's very helpful, thanks. As for what I mean, it probably doesn't matter much, but the amount of interest in every mortgage payment changes, right? - mara Dec 14, 07:04 1
  - I see what you’re saying, but yeah, the important number is the interest rate itself. -- nm - znufrii Dec 14, 07:09
don't forget you will have to pay taxes on the interest earned. You pay the mortgage interest with after-tax dollars -- nm - Beaker Dec 14, 06:52

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I'm not sure how sound this is financially, but I've reached the point where the interest portion of my mortgage payment is

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