Dear Dave,
I bought a house about a year ago. Currently, I have $45,000 sitting in an account with a money manager. I’ve had this account for a little over three years, and the investment hasn’t grown much, if at all. Under the circumstances, and being single, too, would it be better to pull the money out of that investment and put it toward my mortgage?
—Johnny
Dear Johnny,
I recommend putting 100 percent of any non-retirement savings, above your emergency fund, toward paying off your mortgage until the mortgage is paid off. I’d still tell you to pay down the house, even if you were making 20 percent on your money. Just make sure you’re following the Baby Steps, and you’re already putting 15 percent of your income into good retirement investments before attacking the house. Paying down your mortgage is not an expenditure that’s just lost money. The cash is sitting there, you’re just banking it in your home and land. And on a side note, with all the craziness in the market over the past three years, you might come to realize breaking even over that time wasn’t so bad after all….