[Sachin]

Hi everyone, I’m in my early 30’s and bought a primary residence couple of months ago with 30 year conventional (450k loan) at 6.5%. I’ve additional 60k (plus 30k emergency fund) in my savings. I’m debating whether to payoff 60k principal on my mortgage (If so with or without recast?) or Invest 60k in FZROX/FZILX using my Individual account or mix of both?

As of now I’m only doing 12% in 401k, maxing out HSA and ROTH IRA ( I mean no other Investments besides these 3).

Any Inputs on what I should do different?

Thanks in advance!

[Bill]

You cannot recast an FHA Loan. No need to pay off home mortgage this young. Time is on your side. Invest those funds.

[Vidur]

I wouldn’t pay that off right now for two reasons:
1) you will still have to make your monthly payments, if I understand correctly you only reduce years on the backend.
2) I don’t know what you do for a living but the job market is volatile right now, which affects everyone.

If you lose your job or are impacted by the job market, your 60k is going to make you feel more comfortable weathering the storm.

Don’t miss: Under what circumstances would you consider paying down a mortgage with lump sums to accelerate time to home ownership or reduce monthly expenses?

[Kimberly]

Wait until rates come. Refinance down to 15 yrs. Then apply your 60k.

[Author]

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