Why do you people bother?

135

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  • Rolandtheroadie
    Rolandtheroadie Posts: 5,102 Forumite
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    Paying off the mortgage is like a milestone in life for some people.
    I'm overpaying. At my current rate, I should be MF by 50, 8 years from now, although I hope to do so sooner.
    That'll give me 5 years of mortgage payments into the retirement fund.
    I'm also making AVCs into our pension funds.
    The plan is to be in the position to retire at 55 if we want to. Youngest kids will be 21 by then and should hopefully be standing on their own two feet.
  • Secret_Saving_Squirrel
    Secret_Saving_Squirrel Posts: 4,138 Forumite
    Mortgage-free Glee!
    You never know what is going to happen to the savings rates, mortgage rates or to investments. But when you own your house outright, you will always own it, whereas if mortgage rates shoot up suddenly and unexpectedly, you might not own it any more.....
    Paid off mortgage nine years early in 2013. Now picking and choosing our work to fit in with the rest of our lives!
    Still thrifty though, after all these years:D
  • Gloomendoom
    Gloomendoom Posts: 16,550 Forumite
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    Stevie_Palimo wrote: »
    Being mortgage free is a weight off of anyone's shoulders and then you live to enjoy life that much more when you have this burden removed.

    Anyone's shoulders?

    Having a mortgage is earning me money that I can spend on making my life more enjoyable. It certainly isn't a burden. Quite the opposite.
  • Gloomendoom
    Gloomendoom Posts: 16,550 Forumite
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    Secret_Saving_Squirrel wrote: »
    You never know what is going to happen to the savings rates, mortgage rates or to investments. But when you own your house outright, you will always own it, whereas if mortgage rates shoot up suddenly and unexpectedly, you might not own it any more.....

    True, you don't.

    So you just pay off the mortgage if and when the interest paid on the mortgage outstrips the interest earned on savings/investments.
  • edinburgher
    edinburgher Posts: 13,458 Forumite
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    Tantalus86 wrote: »
    Mortgage rates are also falling.

    They have been falling what seems reasonably steadily over the last 5 years or so, but not by 50% all at once (unlike the savings). 60% for some of my accounts.

    Anyway, was just playing devil's advocate, I'm using my pension instead of OPing any significant amount.
  • moneyistooshorttomention
    moneyistooshorttomention Posts: 17,940 Forumite
    It is now some years since I paid my mortgage back early.

    My reason for doing so was because I'd had redundancy/"redundancy" from jobs and, as a result, experienced several periods of unemployment.

    I was very well aware that I might experience "redundancy" that someone else in my exact same job for my exact same length of time might not (because it had happened to me). I was also well aware that I might not get given some jobs that someone else with exact same qualifications/experience/etc as myself would (because it had happened to me). My own personal risk of unemployment was quite noticeably higher - because there were some employers who disapproved of the sort of person I was (ie quite a "political animal" - in my own leisure time). I knew it wasnt right for them to be that way - but could see that that sort of thing does happen and had happened to me. I had two choices - either accept employers feeling they had the right to a say about what I did in my own leisure time or carry on as per normal and try and deal with that fact of being at higher risk than others. To me - it was no contest and I carried on as before (self-respect matters to me).

    Add the fact that I could see my skills were becoming less required etc than they had been and I didn't fancy my chances of surviving in the world of work one way or another till retirement - with the number of years there were till then.

    It made total sense to me to ensure that at least my home/valuable asset was totally safe.

    Hence I made the decision to get shot of my mortgage as soon as I saw the chance. Any time I had a reasonable amount of money spare I put it straight towards paying off that mortgage.

    I paid off the mortgage some years before retirement. I am now retired and believe I made the right decision to safeguard myself as well as I was able to and carry on leading my life as I decided I would.
  • Secret_Saving_Squirrel
    Secret_Saving_Squirrel Posts: 4,138 Forumite
    Mortgage-free Glee!
    You may not be able to pay off your mortgage with your 'investments' if you wake up one day and find them worthless. That may sound ridiculous but it isn't to those of us who remember Black Friday, and if you could speak to any Lloyds 'names' who lost everything some years ago, they would undoubtedly agree with me.
    Paid off mortgage nine years early in 2013. Now picking and choosing our work to fit in with the rest of our lives!
    Still thrifty though, after all these years:D
  • vacheron
    vacheron Posts: 1,603 Forumite
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    edited 7 October 2016 at 8:29AM
    I don't have any psychological motivation to be mortgage free but I do resent paying thousands each year to the bank if I can avoid it. So rather than overpaying I use an offset mortgage and my overpayments remain alongside in cash and are instantly accessible but also eliminate all the mortgage interest charged.

    So, contrary to many, I am actually trying to drag my mortgage out for as long as possible in order to prevent my savings being locked into property. I don't ever have to worry about the mortgage / savings rates not matching and so have no need to re-mortgage for the remaining 21 years of my mortgage term.

    My only regret was automatically taking out a standard 25 year term where in reality I would have been better off with the longest term my age at the time (36) would have allowed. This would have also lowered the contractual minimum payments providing further help should I have experienced any times of financial difficulty.

    Had I not had the offset facility I certainly wouldn't have overpaid anything over the last few years, instead I'd have been saving alongside for the guaranteed liquidity in case of any other emergency. However I might have been tempted to a partial overpayment recently given the way savings rates have been decimated in recent months (and those rate drops still to come).

    Remember also if you are comparing the very lowest mortgage rates against savings you need to factor in the remortgage fees every few years which can be significant on the lowest APR deals.
    • The rich buy assets.
    • The poor only have expenses.
    • The middle class buy liabilities they think are assets.
    Robert T. Kiyosaki
  • chucknorris
    chucknorris Posts: 10,786 Forumite
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    edited 7 October 2016 at 9:12AM
    Secret_Saving_Squirrel wrote: »
    You may not be able to pay off your mortgage with your 'investments' if you wake up one day and find them worthless. That may sound ridiculous but it isn't to those of us who remember Black Friday, and if you could speak to any Lloyds 'names' who lost everything some years ago, they would undoubtedly agree with me.

    Sure there is risk attached with shares, (but with the risk also comes potential reward) but as long as your horizon is far enough into the future (mine is about 20 years away) any fall is likely to be recoverable. When I get to 10 years away from wanting to be (mainly) out of shares I will start to switch to (safer) corporate bonds. We have assets (excluding property) of over 4 times the value of our mortgage debt. So it would take a hell of fall to put us in a bad position.
    Chuck Norris can kill two stones with one birdThe only time Chuck Norris was wrong was when he thought he had made a mistakeChuck Norris puts the "laughter" in "manslaughter".I've started running again, after several injuries had forced me to stop
  • chucknorris
    chucknorris Posts: 10,786 Forumite
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    edited 7 October 2016 at 9:47AM
    Tantalus86 wrote: »
    ]So what are people’s motivation? Is being debt free a bit sooner and having that peace of mind more important than gaining financially?

    I bought our house (home) for cash in Aug 2005 when mortgage rates would have been about 5.5%, I was happy with a return on the cash of 5.5% tax free. I agree with you now though, we have mortgages on our investment properties, and although we have more than that in other more liquid assets, we obviously don't want to pay that mortgage debt down, when we are only paying an average rate of less than 1%, but earning equivalent dividend income of about 4%.
    Chuck Norris can kill two stones with one birdThe only time Chuck Norris was wrong was when he thought he had made a mistakeChuck Norris puts the "laughter" in "manslaughter".I've started running again, after several injuries had forced me to stop
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