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Owning a home is an American dream for which many people sign a mortgage and keep paying it off for over 30 years, or as long as the term of the loan. But if the mortgage is paid off ahead of schedule then you free up the cash to use as per your choice. Here are a few options for you to utilize this money wisely.
Enhance your emergency savings
Have a strong emergency fund by putting some of that money into your savings account so you remain protected during unplanned emergencies.
Save money for your children's education
Kids’ college education could be expensive. So if the mortgage payment is done, the money can be set aside to cover college tuition bills.
You can open a traditional brokerage account and invest that cash, or a 529 plan can be opened, offering you some tax benefits.
Pay attention to your retirement nest
The money is required to cover your living costs in retirement, so now it may be a good time to build your IRA contributions.
Does paying off a mortgage early make sense?
When you pay off a mortgage early, you save a lot of money on interest. You also have a chance to use it for other purposes, like saving for your retirement.
When you pay it off early it gives you an opportunity to potentially save thousands on your mortgage
Reference Source: The Ascent
