this post was submitted on 11 Feb 2025
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$93,770 would be nice but not life changing.
$90k is absolutely life changing for most people. That's a down payment on a house plus moving costs and upgrading appliances and furniture. That's the difference between poverty and living comfortably. If that's not life changing for you, then I'm not sure you're familiar with the struggle, in which case I strangely both pity you and envy you.
Sure you're not gonna buy a mansion with $90k, but you could go from renting a shithole apartment in a shithole town to owning a home in a decent area with access to better employment to sustain a much higher quality of life. $90k is a ticket to escaping geographical and financial shackles.
Slow your roll buddy. I didn’t say it’s meaningless to everyone, only that it wouldn’t change my life.
To your example, I already own a house but $93k won’t pay off my mortgage, or let me retire early, or cover my kids’ college costs.
Paying that large of a chunk of a mortgage would absolutely reduce your future interest costs though.
...but wouldn't change your life.
That's completely relative. Literally anything will change your life, or nothing, it depends on your perspective.
Saying "it wouldn't change my life" means literally fuck all to the people whose lives it would change.
Like good for you, I guess?
Prepaying a mortgage is almost always a worse investment than anything else because mortgage interest is tax deductible.
Not always, but often, yes. It depends on what your alternative potential uses for the money are.
Not always but often. You could even say almost always. 😉
Isn't mortgage interest deductible only if you itemize your deductions?
Sure, but mortgage interest can easily be enough to make that worth it without any other deductions. With $300K principal and a 5% loan, that’s $15K - about the same as a single taxpayer’s standard deduction and roughly half of a married couple’s standard deduction.
That's huge amounts of money in most parts of the world. Westerners don't realise just how much more their currency is worth.
It's pretty huge in the west too, though obviously not to the same extent.
90k? dollars? where i live thats a life of never having to work anymore if i manage it well.
It would certainly accelerate some plans of mine instead of waiting potentially years.