Deciding to pay off house with retirement savings...

[unchained]

I read most of the thread. I believe you should spend some time on bogleheads.org.

There are a few extremely educated people on there when it comes to finances. Also I didn’t see it mentioned but if you haven’t been you should be using a Roth also.

He might make too much money. Phase out starts around 124k and ends at 139k.

 

[TxxAgg]

I read most of the thread. I believe you should spend some time on bogleheads.org.

There are a few extremely educated people on there when it comes to finances. Also I didn’t see it mentioned but if you haven’t been you should be using a Roth also.

I frequent bogleheads as much as I do rokslide. Lots of brainpower there.

 

[cbat]

Good for you. I have not had a house payment for a long time. You can weather some pretty good storms and have to worry about trying to pay for you house.

 

[texag10]

He might make too much money. Phase out starts around 124k and ends at 139k.

Still has options depending on where his other retirement savings are housed. I've been doing backdoor Roth IRA contributions,and my employer offers Roth deferrals in our 401k

 

[Blaw]

Right on. I know some educated folks who interchange typing "quite" when they mean "quiet" and others who say "expecially" when they obviously mean to say "especially." Grinds my gears when I see it/hear it, but they're good at what they do. But if I notice my kids doing similarly, then it's a coaching opportunity.

that's called being a parent, and it's your job to annoy the hell out of them their entire lives lol

 

[Blaw]

Hahaha I'm 100% down for crude, untimely jokes. They fuel my life lol.

Yeah the whole deal is done now. Just put all my money back into an index fund and set back up for $500 weekly payments. I always add more if I start to accumulate money from working OT. But $26k a year is my baseline. This will just be something I laugh about in 15 years when the house is paid off and I have a hefty investment account I get to draw from to get me to my pension.

I'll 100% do some consulting BEFORE I make decisions next time hahaha!

I'd agree with others here, an accountants advice is far more valuable then a financial advisor. And the whole thing about investing is it will never be perfect. Besides your killin it already!

Lol I'm the opposite. Currently not educated, or patient enough for investment.
Sold out of my income producing rental.
Plopped the money down on my mortgage.
Just closed a refi to drop percentage and shorten term.
The only guarantee that I know of is if I pay the house off sooner is ill pay less interest. Thats a fact.

But my ultimate goal is much different.
I want to quit my job and just work enough small jobs to pay for hunting.
I hate working well mostly I hate people and I just don't want to work with them. Also I get lots threats about taking time off.
Since Idk how to get rich im gonna try living poorer.
And if I want to much time off for work. Well I quit then.

Ironically you would still be wealthy...with time/life Totally different perspective but super valuable. If you ever want an interesting easy read check out Lifeonaire...its a little churchy at times but the point of it is valuable.
basically live minimally so you are wealthy with time and do as you please. Rather than slave away trying to have more money yet never having time to actually enjoy life.

Up side is you will pay less taxes therefore more of the money you make you get to keep

 

[huntnful]

He might make too much money. Phase out starts around 124k and ends at 139k.

Yeah, I looked into them briefly, but I make too much. And then I read about to backdoor Roth and said screw the headache for trying to shelter like $5-7K I think it was. Probably my ignorance but I like to keep it simple.

 

[Blaw]

John Bogle the father of index funds and started vanguard. That is a wicked place for someone new to things to get started.

another simple strategy is dogs of the dow. its a very simple principle. and those investments will produce higher dividends.

I do the Canadian version, so I have not followed the U.S. companies that fall within it.
and 9-10% returns consistently as previously posted is tough to believe. I could see those returns averaged out over the long term. or if you bought some dividend stock when the market was in the gutter.

if you want to invest in real estate without buying property look into REITS or MIC's. REITS own multiple property and lease to tenants. MIC's are companies that lend money for mortgages.

anyway im out of this thread....good luck!

 

[huntnful]

I'd agree with others here, an accountants advice is far more valuable then a financial advisor. And the whole thing about investing is it will never be perfect. Besides your killin it already!

Ironically you would still be wealthy...with time/life Totally different perspective but super valuable. If you ever want an interesting easy read check out Lifeonaire...its a little churchy at times but the point of it is valuable.
basically live minimally so you are wealthy with time and do as you please. Rather than slave away trying to have more money yet never having time to actually enjoy life.

Up side is you will pay less taxes therefore more of the money you make you get to keep

Great perspective! My original goal with paying off the house was to be wealthy with time as well. But I think going this route, will give me both options when I get into my early 40's!!

 

[Blaw]

Great perspective! My original goal with paying off the house was to be wealthy with time as well. But I think going this route, will give me both options when I get into my early 40's!!

Hell yea! It's all about those morning coffees and not dreading the next day doing the daily grind at work.

 

[AZ8]

Or..... go to Vegas and put everything on red!

 

[dirtytough]

He might make too much money. Phase out starts around 124k and ends at 139k.

There’s always loopholes.

Yeah, I looked into them briefly, but I make too much. And then I read about to backdoor Roth and said screw the headache for trying to shelter like $5-7K I think it was. Probably my ignorance but I like to keep it simple.

It is simple. I do my own taxes and my wife and I also do back door Roth’s. It’s one extra form and an extra couple clicks with a mouse when contributing compared to a normal Roth.

Roth contributions you can pull out at anytime tax free.

 

[fwafwow]

Roth contributions you can pull out at anytime tax free.

For those reading this who don't do their own taxes, I would be careful here - this statement is correct but it is limited to "contributions". Otherwise there are "qualified distribution" requirements (not as restrictive as a regular IRA), and if a withdrawal isn't a qualified distribution, there is the potential for taxes on the earnings, and a 10% early withdrawal penalty.

 

[Squincher]

See, this is the reason I've been very careful to never become wealthy. What a pain in the ass.

 

[huntnful]

See, this is the reason I've been very careful to never become wealthy. What a pain in the ass.

hahaha major pro tip!!

 

[Beendare]

I think you made a great move with the refi.....many don't understand that not all debt is bad.

I was surprised nobody mentioned.....A CPA can help you make these decisions....and they don't get commissions...they only have your best interest in mind.

Seems to me a guy can easily make a significant amount on your money over the interest on that home loan.

 

[Mr. October]

So I decided about 4 years ago that I didn't want to run the rat race until I was 60 years old, in order to retire with a full pension. I have a good and stable job (pipe welder) but I knew I didn't want an employer for another 30 years dictating what I do because I hunt a lot and know it will eventually become an issue. I just decided to save and invest in a vanguard index fund after reading a few books. Over the last 4 years I've saved/invested $210K and made $50k from my investments. Since all of this Covid stuff, I started to realize that things really aren't all that stabile in general, no matter your current circumstances. My only debt is my mortgage and I owe exactly $260k. Ive decided to move my money to a safe account (honestly a little too soon, could have made quite a bit of money in this last month) and pull it out next year, for tax purposes, and just get rid of all my debt for more future stability should things drastically change for myself, like they have for so many other people during these times. It was a tough decision because I've been saving for so long for a sole purpose of using that money to retire myself early. But I'll just restart the process of saving again once everything is said and done. I'm 30 years old, so I know paying off my house is still a big accomplishment, but it wasn't my goal to begin with, and I know it's not the absolute best thing to do with that money. But these weird times has shifted my perspective for sure!!

Well . . it's a lot better idea than investing your retirement savings in deer hunting. I only know one guy that worked out for.

 

[ETtikka]

At the rate we are printing money, investing in your house is a wise move for sure, I have already seen a lot of inflation with real estate near me. Stock market about to be exposed as the glass house it is anyways, no data supports current levels

 

[casady]

General not a good idea, it takes time to put large sums of money in a retirement fund and you could be missing out on significant gains for several years. And the Tax hit is usually hard on you.

but you really need to look at the long term affects before doing it

 

[Wrench]

I can say that paying my home and cars off at 40 then a few years later walking into a global pandemic.....nobody slept better than I did. I need about $800 a month to cover every expense my family has.

Money is great, but living stress free is greater.