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  •  I'm so disgusted with 401K and IRA accounts (0+ / 0-)

    which seem to go lower and lower in every report for YEARS now.  I can't feature ANYTHING in the stock market as better for me than the dang mattress.   Also I do not at all trust my state pension not to short me in the 10-12 years before I retire, but that's a whole other issue.

    In terms of investing/saving  current disposable income, I am actually thinking about paying down my (perfectly affordable) mortgage early, as the safest and most profitable thing to do with my money.   It would be lovely to be mortgage-free a few years sooner.   Thoughts on that?  

    "The extinction of the human race will come from its inability to EMOTIONALLY comprehend the exponential function." -- Edward Teller

    by lgmcp on Fri Oct 28, 2011 at 09:06:17 AM PDT

    •  It would depend on your circumstances (1+ / 0-)
      Recommended by:
      lgmcp

      And what your mortgage rate interest is. Paying it down early is like investing that portion of your money in an account that pays the real interest rate (come to dwell on it, since mortgage interest is tax deductable, your income tax bracket ahs something to do with it).
         Myself I would opine that you can use SOME of your money to pay down your mortgage, but I wouldn't use all of it. instead I would diversify across a range of investments, with, in your case, an emphasis on income producers (high dividend blue chips, master limited partnerships, REITS etc) and that way you are somewhat protected from this or that event which will hurt this or that investment calss, and also dollar cost average, meaning you put a set amount into your investment each month, so by definition you buy on the dips and the bottom, and don't overbuy on the top. Good luck

      An empty head is not really empty; it is stuffed with rubbish. Hence the difficulty of forcing anything into an empty head. -- Eric Hoffer

      by MichiganChet on Fri Oct 28, 2011 at 10:45:16 AM PDT

      [ Parent ]

    •  Mortage rates are cheap (1+ / 0-)
      Recommended by:
      lgmcp

      Using excessive cash to pay down a mortgage might not be what I'd suggest.

      At some point, we can hope and pray that global markets can once again expand.

      If you'd like to increase your annual mortgage payments by paying 13 months instead of 12 months, you'd be accelerating your mortgage payoff.  Maybe this was your thinking.

      If you can adjust your 401(k) and IRA to be more risk averse with solid dividend stocks and also re-balance towards fixed income bonds, then maybe you'll see less volatility in your portfolio.

      I cannot comment about specific pensions, but I am aware of some horrifying statistics about many of these programs being underfunded due to stock market projections that never materialized.

    •  As said elsewhere, it depends on your (1+ / 0-)
      Recommended by:
      lgmcp

      circumstances. The biggest drawback to paying your mortgage early is that it can be very difficult to access those funds later if needed. You can't sell a small chunk of your house to pay bills, and home equity loans are more or less available depending on other economic issues not under your control.

      If you decide to do this, please make sure you have at least a year's worth of spending set aside in a "safe" account, such as a credit union savings account or CD. That way you have needed liquidity if something bad happens and you need funds easily and quickly.

      Never separate the life you live from the words you speak. ~ Paul Wellstone

      by Melanie in IA on Fri Oct 28, 2011 at 03:37:39 PM PDT

      [ Parent ]

      •  Ah, there's the rub. (0+ / 0-)

        Otherwise, it's a better and more guaranteed rate of return than anything else I'm seeing, even with home-loan rates at record lows.  

        "The extinction of the human race will come from its inability to EMOTIONALLY comprehend the exponential function." -- Edward Teller

        by lgmcp on Fri Oct 28, 2011 at 03:46:31 PM PDT

        [ Parent ]

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