Too many working people are living in draining-poverty. However, a little education can really make a difference.
Using an online mortgage prepayment calculator, I ran a sample mortgage I found online (result pictured). This is a $121,000.00, conventional, 30-year, 2.875% for 5 years’ interest, $502.03 monthly principal & interest for the first 5 years increasing to a variation of $1,089 to $1,252 over the remaining 30 years (with $430.30 monthly escrow).
I have heard it said that paying off your mortgage early does not make sense, because it is a save debt. The criteria I used was to add an additional $3,000 monthly ($36,000 yearly) principal-only payment each month. However, if this was a real scenario, this $3,000 does not have to be paid monthly. It could be spread out over the year to include monetary Christmas gifts, tax return, side hustles, rent paid by family members living in your home, and adopting a scarcity lifestyle. A simple budget would help.
What you should take away from this post is, no one borrows interest from their lender. If you could refinance, eliminating all your other debts, and able to pay off your 30-year mortgage in 3-years & 6-months, paying only $7,504.17 in interest, how can this change your family’s life? You don’t even have to refinance.
