“With great power comes great responsibility.” While this saying was made famous by the friendly neighborhood superhero Spiderman, adults all over the world know exactly what he meant, especially when it comes to their finances.
One of the most significant financial responsibility an adult will face in his or her lifetime is buying a home. Purchasing a property is not cheap, and the deal that you will get into is not short either. One can pay off their home loans in five to 10 years while others stretch it for as long as 30.
However, a lot of homeowners opt to pay off their home loan in Tempe faster. People have a divided opinion about paying mortgages earlier than planned. But living a debt-free life is always something good and rarely a bad thing.
So, if you are looking into shorting your years with your mortgage, then you should expect greater financial responsibility. Here are some things to consider to make sure that your decision to pay off your home mortgage early is the right one for you.
Investment opportunities
One of the reasons why people are hesitant to pay their mortgage earlier despite having extra cash is because of the investment opportunities available in the market. There are pros and cons in putting your money to bonds and stocks as well as using it to pay off your mortgage earlier.
Earning more money is good, but so is paying off your debt early. There is no cookie-cutter way to go around this dilemma. But careful study and understanding of both options can lead you to the right decision.
Current needs
Paying off your home loans at a shorter time means shelling out more money. For some, this means putting that beach trip on hold for a year. While for others, it means taking a slice off their retirement fund and finding an additional job to make ends meet.
Having a debt-free future to look forward to is okay, but your present situation should not be compromised because of it. Assess your current financial and life situation before deciding to pay off your mortgage early.
Life stage
Are you single? Or are you at a stage of starting or expanding your family? Have your kids left home? Or are you nearing your retirement age? Different people have different needs depending on where they are at in their life.
A single homeowner who is not looking into raising a family soon will have more liberty to tweak his finances to pay off their mortgage easy. Someone raising a family might have a harder time doing so. But, if both spouses are working, then it might not be a problem.
People nearing their retirement age would want to live the rest of their lives debt-free and would think of channeling some of their retirement fund to their mortgage. The bottom line is, where you are in life helps decide your financial capability and needs as a person.
This can help you better assess your ability to pay off your home mortgage early.
Home mortgages are great responsibilities. But with a proper understanding of your current situation and needs, you would be able to make an informed decision which can benefit you not just at present, but also the future.
