AA relative to mortgage

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tmcc
Posts: 130
Joined: Tue Feb 06, 2018 6:38 pm

AA relative to mortgage

Post by tmcc » Wed Jun 13, 2018 6:05 am

I've read people here say that paying down mortgage is like investing in a 30y bond. The reality is a little more complicated of course but lets not dwell on that.

in my after tax investment which is 90/10, maybe I should stop buying the bonds and just make that 10% an additional mortgage prepayment. The single biggest negative is that I no longer have the cash liquidity but i do have a HELOC that I don't utilize at a floating rate (currently 5.25% vs 3.625% 7/1 mort with 6 years to go on initial rate).

flip side is that I have a long way to go on the balance. it seems a little moot in the grand scheme of things.

thoughts?

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Sandtrap
Posts: 5103
Joined: Sat Nov 26, 2016 6:32 pm
Location: HawaiišŸ˜€ Northern AZ.šŸ˜³ Retired.

Re: AA relative to mortgage

Post by Sandtrap » Wed Jun 13, 2018 9:51 am

Interesting approach.
Why not do both concurrently in a proportion that is comfortable?

aloha
j

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