What would you do if you no longer had rent or a mortgage to pay???
My parents own their house and are mortgage free. They have been ever since we came to NZ. It’s pretty amazing…I was just thinking the other day how low their bills must be. No mortgage. I don’t think they have very much insurance (not even sure if they have car or contents insurance. Blergh) Neither works full-time.
From an NZ-centric point of view, paying off the mortgage ASAP is a no-brainer. Mortgage rates here are quite high and we don’t have 30-year fixed terms. As far as I know, the longest you can lock in is 5 years.
Housing is usually the single largest expense for any household, and if you can eliminate that…well, I can’t even imagine the possibilities! It varies, but rent is up to 40 per cent of our total spending, or up to about 20 per cent of our income. With an extra $1000 a month, we could eat like royalty, take a trip every month, or shave years off saving for a down payment.
But that just ain’t gonna happen, so I’m not going to think too much about it. I’m one of those people who hates being asked “What would you do if you won Lotto?” I like to fantasise about things that are REMOTELY within my reach, thankyouverymuch.