So here's why it's DUMB DUMB DUMB to have a paid for house....
I just went and looked at the Schwab account I always reference here... (I hold back because I never really want you boneheads to know how much money I really have!
)
That account spins off over 400,000 in dividends per year ----- AND ----- has a 10.34% capital gain (paper gain). There's over 7MM in that account... and it's on pace to return 1MM in cash and gain this year if things just hold where they are.
Now -- I realize that I have an "out sized" argument going here -- but the point is that no matter how much have invested or how much you owe -- if you manage your money correctly... you should have a gain on your house - a gain in your account - and you should be taking a tax deduction on your house which effectively reduces your percentage rate you're paying by the effective tax rate (4% mortgage - 30% tax bracket - your real rate is closer to 3%).... so if you're paying 3% effective rate -- and you're getting a 4% dividend and 7% growth on your investments.... you can see very quickly that there's nothing gained by paying off a mortgage.
