Should I pay off my mortgage with my endowment policy ? There is enough money in the policy to do it.?
The Endowment Policy is three policies that add up to a surrender value just over the value of the mortgage. The Policies will mature in 4, 5, 6 years. There are warnings against each of the polies - that they may not pay enough to cover the mortgage value at maturity, but the larger and older of the three policies has been looking better over the last two years, and, if left to maturity, will be just enough to pay-off the mortgage.
Could it be "cash in the hand is better than a promise of a brighter future?".
Answers:
Consider carefully the age of your mortgage.
If it is near maturity, paid off, bear in mind that you may have paid the "bulk" of interest on the total note. In the early years of a mortgage, the majority of the installments are applied to interest. At about the halfway point of the term, the interest payments decline and more of the installments are applied to the principle.
If you look at the present principle balance and the balance of the note due, the difference is interest.
Consider then if the savings in interest is worth paying in full. If very little interest is due over term, then the principle is being paid with very little interest, or expense.
If that be the case, I would suggest another investment. If by pay off, a great deal of interest is saved, consider the savings and if paid, then continue "saving" the installments and investing those.
Not sure read some mortgage tips on this site
If there is enough and beneficial to you then why not.
Nope. There's little likelihood of your money being able to out perform what you will be paying in mortgage interest.
go to www.suzeorman.com, you can ask
a question in this website. She has a show
on CNN (if i'm not wrong).
Yes, I did a few years ago and mortgage-free living is great.
If you pay off your mortgage, you loose your tax deductions on your interest payments. Depending on your age and tax bracket, you may want to consider other option. If you are under 50 and your equity is high, you could take out you equity, add it to your endowment, place them both in a CD of 5%+ and use the interest to make you payments. This would give you a chunk of money in savings and give you an increased tax writer off. Have a knowledgeable,open minded CPA do the math for you. I believe you will be close to not paying any money out of pocket and still retain a chunk of cash for the future.
This is the real deal!
As far as investing your cash in the market, you might as well play roulette. Your odds of making money are the same.
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Could it be "cash in the hand is better than a promise of a brighter future?".
Answers:
Consider carefully the age of your mortgage.
If it is near maturity, paid off, bear in mind that you may have paid the "bulk" of interest on the total note. In the early years of a mortgage, the majority of the installments are applied to interest. At about the halfway point of the term, the interest payments decline and more of the installments are applied to the principle.
If you look at the present principle balance and the balance of the note due, the difference is interest.
Consider then if the savings in interest is worth paying in full. If very little interest is due over term, then the principle is being paid with very little interest, or expense.
If that be the case, I would suggest another investment. If by pay off, a great deal of interest is saved, consider the savings and if paid, then continue "saving" the installments and investing those.
Not sure read some mortgage tips on this site
If there is enough and beneficial to you then why not.
Nope. There's little likelihood of your money being able to out perform what you will be paying in mortgage interest.
go to www.suzeorman.com, you can ask
a question in this website. She has a show
on CNN (if i'm not wrong).
Yes, I did a few years ago and mortgage-free living is great.
If you pay off your mortgage, you loose your tax deductions on your interest payments. Depending on your age and tax bracket, you may want to consider other option. If you are under 50 and your equity is high, you could take out you equity, add it to your endowment, place them both in a CD of 5%+ and use the interest to make you payments. This would give you a chunk of money in savings and give you an increased tax writer off. Have a knowledgeable,open minded CPA do the math for you. I believe you will be close to not paying any money out of pocket and still retain a chunk of cash for the future.
This is the real deal!
As far as investing your cash in the market, you might as well play roulette. Your odds of making money are the same.
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