Having no mortgage is widely considered a significant personal accomplishment that offers substantial benefits, primarily peace of mind and financial security. However, whether it is the "best" financial move depends on your personal circumstances, risk tolerance, and alternative investment opportunities.
Even if you have the funds readily available, skipping a mortgage might not always be the best move. A mortgage might help you buy a property that you otherwise wouldn't be able to afford with only cash on hand, and you may be able to deduct interest payments on your taxes, assuming you itemize.
Comments Section If the interest on your mortgage is lower than the highest interest available from a bank, then it would be better to save. If the interest on your mortgage is lower than the highest interest available from a bank, then it would be better to save.
If you are in a lot of debt you are not super-rich. Your net worth is your assets (value) minus your debt obligations. Being debt-free is beginning from a place of opportunity to generate wealth and financial freedom.
A good goal is to be debt-free by retirement age, either 65 or earlier if you want. If you have other goals, such as taking a sabbatical or starting a business, you should make sure that your debt isn't going to hold you back.
The trend towards older ages for first-time buyers means that many will be paying off their mortgages later in life, often not becoming mortgage-free until around 63 years and 8 months, based on an average mortgage term of 30 years.
If your interest rate is 4.5% or lower4, you may want to focus on investing. Alternatively, if you have a high interest rate, you'll want to make paying that off a priority. Also, remember that credit cards and personal loans commonly come with high interest rates.
Is it better to pay off debt or save? Ideally, you would do both. But if that isn't an option, consider the following: Interest rate: Credit card debt and high-interest loans can accumulate interest at rates that far exceed what you can earn on a savings account.
Turning $10k into $100k in one year requires very high-risk, high-reward strategies like aggressive stock/crypto trading, flipping digital assets (websites/e-commerce), or launching successful online businesses (courses, dropshipping), as traditional investing yields far less; you'll likely need a combination of significant capital investment, rapid skill acquisition, strong market timing, and exceptional execution, accepting the high chance of significant loss.
Credit cards are convenient, but if you don't stay on top of them, your debt can get out of control. If your credit card debt has reached $30,000, that should be a big-time wake-up call.
Cons of paying your mortgage off early. It can keep you from saving or paying off other debt—Draining your bank accounts to pay off a mortgage can be very risky. Most experts recommend prioritizing a few other things before you tackle paying off a mortgage.
Investing $1,000 a month for 30 years means you contribute $360,000 total, but with compounding returns, the final amount varies significantly by average annual return, potentially growing to over $1 million at 8% and reaching around $2 million or more at a 10% average return, illustrating the power of long-term, consistent investing.
Cash in a savings account or bond is low risk/low reward because the set interest rate over a defined period gives you a good idea of how much you'll get back. By offering less certainty, property can bring higher rewards over the long term.
Being mortgage-free can make it easier to downsize in other ways – such as going part time – and usually makes it cheaper and easier to buy and sell your home. Generally, a smaller mortgage gives you greater freedom and security.
At the time of writing (December 2025), the average monthly repayments on a £70,000 mortgage are £409. This is based on current interest rates being around 5%, a typical mortgage term of 25 years, and opting for a capital repayment mortgage. Based on this, you would repay £122,764 by the end of your mortgage term.
If you are looking to purchase a home, a mortgage might be the better choice as it offers larger loan amounts, lower interest rates, and longer repayment timelines. On the other hand, if you have various financial needs or want more flexibility with the loan funds, a personal loan could be the better option.
Put aside just $13.70 per day, and at the end of the year you'll have $5,000; double that to $27.39 daily and you'll have $10,000 by year-end—and that doesn't include the interest you may earn. You can save money by making a budget, automating savings, reducing discretionary spending and seeking discounts.
If you wanted to earn an average $3,000 per month, you would need to invest $1.6 million ($36,000 divided by 2.2%). While there is nothing wrong with passive investing, most investors are likely to do much better if they build their own investment portfolio.
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There's a greater sense of peace, freedom and opportunity that comes with being debt free," says Falcone. "Not owing anyone anything or being beholden to anyone offers debt-free individuals more options and control over every dollar they own.
Most debts fall off your credit report after seven years of nonpayment. This can be helpful since negative credit report entries can hurt your credit score. But typically, people remain liable for debts in their name even if those debts don't appear on their credit report.
If you're carrying a significant balance, like $20,000 in credit card debt, a rate like that could have even more of a detrimental impact on your finances. The longer the balance goes unpaid, the more the interest charges compound, turning what could have been a manageable debt into a hefty financial burden.
The "2% rule" for mortgage payoff refers to two different strategies: aiming to refinance to a rate 2% lower than your current one for significant savings, or adding an extra 2% of your monthly payment to pay down principal faster, potentially saving years of interest and paying off the loan much sooner. Another related method is the bi-weekly payment (paying half your monthly bill every two weeks), which adds up to one extra payment a year, significantly shortening the loan term.
They Find Tax Advantages and Strategic Leverage
Millionaires will review their debts and determine if there are tax benefits for certain debts. For instance, mortgage interest and business debt may carry certain tax advantages. Sometimes wealthier individuals use debt to leverage investments.
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