That was, until I started writing about people who d paid them off. Now, it s become a priority for me. This spring, I made my first extra principal payment with a $1,500 check I got from overpaying on my escrow account.
I hate paying interest, and I d be happy to sacrifice investment returns to save on it
I ve paid countless amounts of interest on my federal student loans. I paid a good amount of interest on a four-year car loan previously. I m not super keen on paying it for another 30 years.
One of the main arguments against paying off a mortgage early is that the returns you d get from investing the cash are higher than the typical mortgage interest rate. And, that s absolutely a fair argument. The average mortgage interest rate right now sits right around 3%. The average stock market return sits around 9%.
Marisa Palmieri Shugrue, second from right, with her family. Courtesy Marisa Palmieri Shugrue
Marisa Palmieri Shugrue and her husband paid off their mortgage during the pandemic in 2020.
She says living within their means was a big part of their success. She and her husband each learned that lesson from their parents. She wrote in an essay for Insider, They showed us that living within your means can be done, but you have to delay gratification and make careful choices, like cooking most of your meals at home, being content in a starter home, and not always having designer clothes or the latest technology.
A medical scare with Gwiazdowski in 2012 also shook the family, and added to their desire to be debt-free. We were fortunate to have a modest emergency fund, but the debt we had was a huge burden to bear when we had other things we needed to worry about, she said.
As Gwiazdowski recovered, they started to get serious about paying off their mortgage, even though they only had one income. Here s the two-part strategy they used to make it happen.
They refinanced their mortgage to reduce the interest rate
One key part of their strategy was to secure a low-interest, 15-year mortgage. With rates low in 2013, they decided to take advantage of the opportunity and refinance the mortgage. (Note that mortgage rates have been at or near historic lows since 2020; Insider has listed the best mortgage refinance lenders for borrowers seeking lower rates.)