[USER]

So here’s the situation. My mom, an immigrant, is single andalmost 60 and has been working her entire life to try to pay off the house She got back in the 90s.

I’m not 100% sure of her income but if I had to guess it’s probably around $90,000.

Now that us the kids are older we’re also helping her by giving her some money monthly to try to help her pay it off faster, even though she has a relatively low interest rate because we think that having a paid off house is just the best ease of mind.

It turns out that she hasn’t been using any of our money and just putting it away somewhere else because she said that she thinks it’s still a good idea to have some kind of debt and that sinceshe owns a house, she can use that as some kind of deduction during tax season.

I’m obviously new to all this and consider myself a 1.5 generation so I’m not really sure what’s the truth or how this all works but does anyone have any insight or suggestions?

Thanks in advance

[Amanda]

I feel like she needs to sit down with someone. Did she refinance? If not she is at the TAIL END of the mortgage and paying pennies in interest.

She’s in her 50s making almost 100k. If there a reason you guys feel you need to give her money.

It might be a better plan to start a hysa or mutual fund of something and earmark it for her.

It seems like she is doing fine on her own, but there might come ca day when she isn’t.

Unless she is taking your money and properly investing it you are better off keeping it for now

[Christine]

From experience from my own immigrant parents, I will guess that extra money is sitting in a regular savings account.

*EMERGENCY FUND- I would put 6 months of her expenses in High Yield Savings accounts (HYSA) please include her house tax cost.
Since she wants some tax deductions she can

*Put some in a HSA if she has one
*Invest $8000 into the S&P with her IRA
*use the rest to put down on the loan.

*OF ANY IS LEFT I WOULD CONSULT WITH A FINANCIAL ADVISOR ON HOW TO INVEST THE REST

She is in the back end of her 30 years. I would pay off the house.

In this current job climate, if she was to lose her income, would she still want to have to pay on a mortgage?

[Seden]

Does she even pay enough interest to need to itemize? After paying for that long she is probably at the end and probably not paying much interest (unless she cashed out at some point).

Also paying interest to get a fraction of it back with taxes is not a good reason to keep the debt.

A good reason would be if she can beat that interest with investments.

[Gemma]

Tax breaks are only available for interest if she itemizes. Most ‘normal’ people no longer do that.

The bigger question for me is why are you helping? Does she want the help?

It sounds like she is sort of rejecting your help a little, which is perfectly ok for her to do because its her house, her mortgage, her business. Not yours.

If you want to help, which is admirable, maybe discuss finances with her ONLY IF SHE WANTS TO and see if there is a way she would like you to help.

You still give her the same money but she receives it in a way that is valuable to her.

[Lorena]

Someone should sit down with her and go over her finances not only to see if she is making sound decisions but also if there is an emergency someone can step in to help.

Immigrants can make irrational decisions at times because of there hardships and if the money is just put under the mattress or something not doing better than inflation, it’s actually worse than paying her house off.

[Lit]

Yep, she is correct. As long as she’s not spending it. That other money she is re-investing it.

[Boyer]

A mortgage is 30 years. The 90s were 25+ years ago and prices were significantly lower. If she wanted it paid off, it’d have been paid off by now.

I feel like you’re worrying more than the person who the mortgage is tied to.

I’d personally be more curious where all the money went to.

[Shawn]

In my world $90k is an absolute shit ton of money. Why is she not using that to pay off the house?

[Ruben]

This is not just signals, this is a full-blown strategy for success. Huge respect for the admin!

You don’t need to guess, just follow the structure and win!

[Vargas]

I’m a first generation immigrant and I think like your mom. I’m not paying off my mortgages because the interest is quite low and invest my money instead (no other debts other than mortgage).

I’m on track to FIRE, My siblings and I give money to my parents and they save them instead of spending them.

It sounds like she knows what she’s doing and just ask what she does with the money you gave her.

[Susan]

Personally, I’d rather have some money socked away and a small mortgage (cause if she’s been paying on it since the 90s there can’t be much left on it), than a paid off house and no money saved.

[Blake]

Personally, I, not an immigrant, would do the same thing. Especially if I, again not an immigrant, were to put that into a HYSA or preferably the S&P.

Your mom is a smart cookie

[Steve]

1) if she’s investing it in index funds – then it’s better than laying off low interest mortgage. Although I doubt she’s doing it. Probably sitting in a bank earning less than inflation

2) currently standard deduction is so high for taxes, that I doubt she’s getting any benefit from paying that mortgage.

Also, by now the majority of the mortgage payment is provincial, since she bought a house in the 90’s. Only the interest portion is tax deductible, if a person itemizes.

[Christine]

The standard deduction for single tax filer for 2025 is $15k. That’s over $1k/mo in interest.

Unless she’s been borrowing against her home, it’s highly unlikely she has higher itemized deductions than that unless she’s doing her taxes incorrectly.

Imo, it’s not a good idea to have much debt when you’re 60+. If she needs a safety net, she could open a HELOC on her paid off house for dire emergencies.

If you’re going to help, you need to know how much her mortgage principal and interest is and where your donations are going.

If she’s mostly paying to principal, it might make sense to keep the mortgage and invest excess funds.

You need actual numbers to help with advice.

Another thought, what if she can no longer work? Who will pay the mortgage? Have a real talk with her and get facts.

If she doesn’t want your help, that’s fine too. You have a family to look out for, invest for them.

[Ani]

I would agree with her. Cheap debt in the form of a mortgage is probably better than paying off the house too soon and needing that money then having to borrow it at an astronomical interest rates in the event of an emergency.

I got a mortgage in 2006 and the interest rate was 4.25%.

If she’s anywhere near that rate for her mortgage she can beat it by a simple CD or money market account.

She also is correct that she can write off some of the mortgage interest for her federal tax liability.

[Dale]

Because borrowing against your home is cheaper. interest than a credit card

[Jianle]

She’s not wrong, if the interest rate is less than 4% while saving account is ~4%.

But if she does standard deduction on her taxes, then there’s no mortgage interest deduction at all, it becomes a moot point.

[Author]

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