Mortgage and investing tradeoff
Mortgage Payoff vs. Invest Calculator
Compare sending extra cash to mortgage principal with investing the same amount, while keeping the monthly outflow equal.
Results will appear after valid values are entered.
Mortgage payoff effect
The extra-principal strategy sends the added monthly cash to the mortgage until it is paid off. After that, the model invests the amount that had been going to the mortgage so the two strategies keep the same total monthly outflow.
Compare the same future date
Home value is left out because it is the same in both paths. The comparison uses investment value minus remaining mortgage balance. A positive difference means the modeled invest-first path is ahead at the selected horizon.
Pay extra principal
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- Investment balance
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- Mortgage balance
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- Net position
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Invest the extra cash
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- Investment balance
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- Mortgage balance
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- Net position
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What this estimate leaves out
Investment returns can vary widely and can be negative. The model uses a constant monthly return based on the annual assumption. It does not model market volatility, taxes, account contribution limits, employer matching, changes in mortgage terms, home-value changes, or transaction costs beyond the investment fee entered above.
Mortgage-interest tax treatment also varies by household and loan. Treat the result as a planning comparison, then adjust the assumptions for the account and mortgage you actually use.
For educational purposes only. Results are estimates. Review the Calculator Methodology for shared assumptions, rounding, payoff timing, and privacy-conscious analytics details.