This mortgage calculator gives a detailed breakdown of up to two mortgages and calculates payment schedules over your full amortization. For more information about these these financial calculators please visit: Financial Calculators from KJE Computer Solutions, Inc. Information and interactive calculators are made available to you only as self-help tools for your independent use and are not intended to provide investment or tax advice. Retire early with a mortgage which will continue to be paid off slowly over 30 years. This will help calculate how much you will need to pay each month including interest. During the first few years of having a mortgage, you likely had a higher rate than what you have now. Learn more Opens a new website in a new window. Make an RRSP a key part of your retirement plan. My take: Invest. But often times, even if you have mortgage debt, you'd do better to pay off that debt rather than invest the money otherwise. Should you invest extra cash or use it to pay off your mortgage? We’re here to support you through COVID-19. Same as above – bare minimum repayments, invest as much as possible. Scenario 2: Instead of borrowing, the family uses $200,000 of savings to either pay cash for a home or pay off a mortgage balance. *, If you invest $10,000 into your RRSP instead, your savings over 20 years will be $41,503.16.*. This additional amount accelerates your loan payoff by going directly against your loan's principal. Compare that guaranteed return to the return you could get by investing your money over the same period of time to see if you should invest … Your desired payoff time-frame is the amount of time you would like to pay off your debt. It puts you at risk. We cannot and do not guarantee their applicability or accuracy in regards to your individual circumstances. If you do not have a large enough portfolio to pay off your mortgage, you can still use similar logic. If they put that money toward the mortgage, by age 54 they would have paid off their mortgage, but have no retirement savings. You may have noticed you end up with a lot less saved than what you would have had you decided to save more and pay down your mortgage at a slower rate. All examples are hypothetical and are for illustrative purposes. Financial theory recommends that if your after-tax return on investments is greater than your after-tax cost of debt then you should invest. This quick calculator will show you the cost of the penalty associated with paying off your mortgage before the maturity date. In the scenario of investing in the S&P 500, we used the next five or 10 years of compounded annual returns, assuming you would buy and hold for a period. By clicking submit and not opting out, you consent to the personal information from this calculator being shared with a Sun Life Financial advisor to help them better understand your financial or insurance needs. In the meantime, learn a little about what a first meeting with an advisor is all about, and see the impact working with an advisor can have on your future. Some pre-retirees and retirees might be wondering if it makes any sense to pay off the mortgage on their home in the current low-interest environment. This financial calculator helps you find out. Pay off your mortgage or invest? So if you’re young, and you sign a 30-year mortgage, you have plenty of time to pay it off. Or invest the money? Warning for Sun Life shareholders about Obatan LLC offer. Second, I would invest some money in RRSP's to lower my tax bill - also low cost ETF's. Have a great first meeting and remember there's no cost to talk to an advisor. Reason No. Screenshot of Dave Ramsey Mortgage Payoff Calculator take July 2019. You could borrow against the equity in your home to do a renovation, for example. Option A: Pay down mortgage then invest savings into your RRSP. ING DIRECT Canada: 1-866-700-9836 Laurentian: 1-800-252-1846 . Your mortgage contract may allow you to: increase the amount of your regular payments; make lump-sum payments; Your lender calls this a prepayment or prepayment privilege. If you pay down the mortgage, you'll pay down the principal and get a benefit of avoided interest at the current 30-year fixed rate. In many cases, investing is the better option. Mortgage Calculator with Lump Sums. IMPORTANT NOTICE: As of Jan. 1, 2020, The Great-West Life Assurance Company, London Life Insurance Company and The Canada Life Assurance Company became one company – The Canada Life Assurance Company. All rights reserved. Pay the bare minimum on your mortgage and direct every spare dollar towards investing. Same as above – bare minimum repayments, invest as much as possible. View the report to see a complete amortization payment schedule, and how much you can save on your mortgage! Pay off your mortgage? Well, that's a goal many a homeowner has...mostly in their dreams. How about paying off your mortgage in 5 years...or 10 years? Special to The Globe and Mail . Then, as you leave work, sell some investments to pay off the mortgage. Other helpful RRSP calculators to consider: Make a RRSP a key part of your retirement plan. Yes, I would like to receive free Brighter Life emails from Sun Life Financial with personalized tips, tools and offers. Most of the time, paying off the mortgage is a compelling option.But low mortgage rates such as we saw in 2009 and 2010 – coupled with the stock market buying opportunity of a lifetime – turned conventional wisdom on its head. Talk to your advisor about building an RRSP that fits your needs. Assuming a 7% annual rate of return, you’ll end up with $476,036. impact working with an advisor can have on your future. When you receive some extra money it may be difficult to determine whether you should invest the funds or use them to pay towards liabilities. You may also enter extra lump sum and pre-payment amounts. The fact is that a majority of people with mortgages will still carry some level of mortgage debt into retirement, and the reason for this is not far-fetched. If you pay off your mortgage before you retire, you might only need $80,000 each year. View the report to see a complete amortization payment schedule, and how much you can save on your mortgage! Option 4. I understand I can unsubscribe at any time and acknowledge this email address belongs to me. Reasons to Invest First. For instance, if the return on certain shares is 8% and the interest rate on your mortgage is 5.5% you could be forgoing a higher return. The accelerated bi-weekly payment is … Today, the opposite is true. We encourage you to seek personalized advice from qualified professionals regarding all personal finance issues. My take: Invest. If you’re trying to pay off your mortgage early, the worst thing you can do is give the bank extra. Once your mortgage is paid off, if you then invest that same monthly mortgage payment into your RRSP, it will be worth $32,181.25 by the end of year 20. Read more here. If you are using Internet Explorer, you may need to select to 'Allow Blocked Content' to view this calculator. H&R and Northwest Healthcare are your investment options. Invest the income tax savings in a TFSA, once the RRSP limits are reached. Which leads us to the perennial problem: Should Canadian’s focus on paying off their mortgage and lowering debt or invest in RRSPs? Having debt with an interest rate that is higher than the annual return on your RRSPs is not a great idea, it means you aren’t making any money off of your RRSP investment. If you answer no, just pay off the mortgage and sleep soundly at night. Investment versus Loan Payoff -- A Scenario Calculator. *, Now that you’re thinking about your retirement savings, you may also be interested in…. Here's what he should do with the money he's currently putting toward his TFSA. This calculator allows you to compare what would happen if you took one of two choices with some extra cash you have -- prepaying your mortgage each month, or investing it instead. Use this calculator to see how much you can earn by increasing your debt payments and paying off your debts faster. Rates of returncan vary among different kinds of investments and investment styles. Option A: Pay down mortgage then invest savings into your RRSP. For example, if you have only stocks in your portfolio, you may see better than 7% return on your investment. Register Should I pay down my mortgage or invest in my TFSA? Benjamin Felix . Once your mortgage is paid off, if you then invest that same monthly mortgage payment into your RRSP, it will be worth $32,181.25 by the end of year 20. Canada Mortgage Payment Comparison Calculator. and savings information to create a personalized savings recommendation based on interest rates. Q: I have an outstanding mortgage of $490,000 with a 3.34% fixed interest rate for another 4 years and I do biweekly payments of $1,310.I currently invest $1,000 a month in a … IMPORTANT NOTICE: As of Jan. 1, 2020, The Great-West Life Assurance Company, London Life Insurance Company and The Canada Life Assurance Company became one company – The Canada Life Assurance Company. This is over the long term, but that’s not an issue if you have time on your side. The principal is the amount you want to … This calculator allows you to compare what would happen if you took one of two choices with some extra cash you have -- prepaying your mortgage each month, or investing it instead. take that same monthly payment and put it into your RRSP, More information on why we need your postal code, How a Sun Life Financial advisor can help you, Estate and Financial Planning Services (EFPS), Why work with one of our licensed professionals, Register for a my Sun Life Online Account, Contributions, withdrawals and fund changes, Student and new graduate programs overview, Rotational Leadership Development Programs, Co-op and summer internship opportunities, Chartered Professional Accountant (CPA) Pre-Approved Program, Registered retirement savings plan (RRSP). Please enter a valid Canadian postal code. At that time, it made sense to pay down the mortgage. In this scenario, by making the payment in year five, you’d save £4,954 in interest and pay off your mortgage eight months early. Mortgage Payoff (Canadian) How much interest can you save by increasing your mortgage payment? If you’re a homeowner with a mortgage and you have a little extra money to hand, you may be wondering whether it’s better to pay off your mortgage or invest the money. For us, it was the … You can choose the payoff time in months or years. Benzinga's financial experts take a detailed look at this important decision in 2021. Share a little about what's important to you right now to help an advisor provide options and recommendations built just for you. Every loan comes in two parts: the principal and the interest. Martin is not sure whether he should invest or pay off the mortgage. If you invest $10,000 towards your mortgage, your amortization period reduces from approximately 20 years to 19 years. An advisor can help you put together a retirement savings plan that is right for you. Learn more about how you can take advantage of the benefits of RRSPs to save for your retirement. How Canada Life is supporting you during COVID-19. Free mortgage payoff calculator to evaluate options and schedules to pay off a mortgage earlier, such as extra monthly payments, a one-time extra payment, a bi-weekly payment, or simply paying back the mortgage altogether. Then, as you leave work, sell some investments to pay off the mortgage. Retire early with a mortgage which will continue to be paid off slowly over 30 years. Option 4. Oftentimes I get this question and have gotten it over the decades. In the perennial personal finance debate over whether you should pay off your mortgage or invest your savings, some take a firm stand. Sign-in help Once your mortgage is paid off, if you then invest that same monthly mortgage payment into your RRSP, it will be worth $32,181.25 by the end of year 20. Mortgage Payoff (Canadian) How much interest can you save by increasing your mortgage payment? Should you pay off your mortgage or invest it? On a £150,000, 25-year mortgage, offsetting £25,000 of savings could mean you pay off your mortgage one year and 10 months early, and save £3,350 in interest, while still having access to your savings if needed. Pay off the mortgage, first. Don't misread this as saying everyone should go for one of these mortgages. The client will be required to pay an extra amount as a prepayment penalty. Convert your mortgage into a secured line of credit: You can use the line of credit to pay off the mortgage when the term ends. This additional amount accelerates your loan payoff by going directly against your loan's principal. To pay off your mortgage faster, consider putting extra money toward your mortgage. The term ratio refers to the size of your mortgage loan amount as a percentage of your total purchase price. what a first meeting with an advisor is all about. Learn more Opens a new website in a new window. A mortgage with a down payment below 20% is known as a high-ratio mortgage. Royal Bank of Canada does not make any express or implied warranties or representations with respect to any information or results in connection with this calculator. There's nothing wrong with paying down your mortgage, of course. How Canada Life is supporting you during COVID-19. The classic non-answer answer is “do both”. The line of credit can be paid down whenever you want, and there aren’t any penalties. Assuming you don’t have $200,000 in cash to pay off the mortgage, you might be considering extra payments. Pay an extra $750 per month on the mortgage. Although this is possible, it comes at a cost. A Sun Life Financial advisor will contact you in the next 3 business days to schedule a time to meet to discuss your results and offer insight and guidance with your insurance or investment needs. It's a matter of choice. We can work with a conservative $100 per month as an extra payment, about $3 per day. Click the “calculate” button to see how … If you pay off your mortgage over 15 years, your total … If you invest $10,000 towards your mortgage, your amortization period reduces from approximately 20 years to 19 years. The final decision on whether to pay off a mortgage or invest rests with you. This financial calculator helps you find out. Once you’ve finished paying off your mortgage, you invest $2,783 a month every year for the next 10 years. And it is a question, no matter what interest rates are. Prepay vs Invest Calculator. This will help calculate how much you will need to pay each month including interest. Since you pay 52 weekly payments, by the end of a year you have paid the equivalent of one extra monthly payment. Assuming a 5 per cent mortgage rate and 5 per cent annual return on RRSP investments, if the Canucks saved their $5,000 into RRSPa every year, they would end up with nest egg of $508,415 at … It’s a worthy goal to be debt-free but not necessarily the right choice. Interest rates should always be taken into consideration, whether you want to invest or pay down debt. Prepay vs Invest Calculator. The Money Guy Show has the answer to your home loan question! Option A: Pay off your mortgage then take what you had been spending on mortgage payments and save it in your RRSP. *For illustration purposes only;, your rate of return may vary. You could be missing out on high investment returns from shares. How much interest can you save by increasing your mortgage payment? A mortgage is the single largest debt the average Canadian or American will ever have to pay off. Invest or pay off the mortgage? Enter your total amount of debt (mortgage, auto loan, etc.) However, if your mortgage’s interest rate is higher or can outperform your investment prospect, you should pay off or aggressively pay down your mortgage. Also, you might … An advisor will contact you in the next 3 business days to schedule a time to meet to offer insight and guidance with your insurance or investment needs. This financial calculator helps you find out. Third I would increase my monthly mortgage payments by $50.00 or $100.00, or something you probably won't feel much difference, but that will pay off your principal faster. If you invest $10,000 towards your mortgage, your amortization period reduces from approximately 20 years to 19 years. Your desired payoff time-frame is the amount of time you would like to pay off your debt. Your mortgage pays itself off automatically over the years through regular payments, but investing doesn’t happen unless you choose to do it. Javascript is required for this calculator. But the worst decision is to spend and not to pay off … If you put $10,000 towards paying off your mortgage, the length of time it will take you to pay it off shrinks from about 20 years to 19 years. However, the interest rate on your 30-year fixed mortgage will never change, whereas savings account yields will probably rise over time. But you may gain more in the long run by paying down your mortgage first. They could then focus on their RRSPs, using the $5,000 a … Information and interactive calculators are made available to you as self-help tools for your independent use … You may also be interested in: Savings … All high-ratio mortgages require the purchase of CMHC insurance, since they generally carry a higher risk of default. So if you chose to simply invest in one of these accounts, rather than pay down your mortgage, you’d be losing out by carrying mortgage debt, even at a super low rate of 2.75%. W hen interest rates are high or rising, a tricky question for private investors comes to the fore: “Should I pay off my mortgage or invest?”. now. 1: Save money. Also gain some understanding of the pros and cons of paying off a mortgage earlier, or explore many other calculators covering math, fitness, health, and more. The calculator uses this to calculate how long it will take to pay off your debts and how much you will pay in interest. This is the amount of money you have to put towards either your RRSP or your mortgage. Royal Bank of Canada will not be liable for any losses or damages arising from any errors or omissions in any information or results, or any action or decision made by you in reliance on any information or results. Should you pay off your mortgage early or invest? I can offer a rational basis to help you decide. As mentioned, the stock market sees average returns of around 7%. For example, rather than saving $1,000/month into a taxable 60/40 portfolio while also making regular mortgage payments, you might put $600/month into a 100% equity portfolio while adding $400 to an accelerated mortgage payment. This calculator will compute the total interest savings you'll get by adding an additional amount to a regular debt payment. Find out which strategy is right for you. Financial Calculators from KJE Computer Solutions, Inc. You’d hold onto that investment instead of paying off the mortgage. Last October, we looked at the pitiful market returns, and decided we wanted to be debt free and we did just that – cashed out our TFSAs and a few Non-registered investments and became mortgage free. The effect can save you thousands in interest and take years off of your mortgage. The calculator uses this to calculate how long it will take to pay off your debts and how much you will pay in interest. © Sun Life Assurance Company of Canada. “Second only to eliminating debt, paying off your mortgage is one of the most important steps to retiring richer,” says Kevin O’Leary, author of Cold Hard Truth on Family, Kids & Money . … Here’s how we can help you. Strategy 1: Pay Down Mortgage First 1. If you would, then keep your mortgage and invest the lump sum. Depending on when you first took out your mortgage, it’s possible most of the payments went towards interest and not principal. Your mortgage pays itself off automatically over the years through regular payments, but investing doesn’t happen unless you choose to do it. Once the mortgage is paid off, put the former mortgage payment plus $750 per month in the RRSP. Another drawback to paying off your mortgage rather than investing in shares is the opportunity cost you face. It was more beneficial to invest than pay off the mortgage given low mortgage rates. *, If you put $10,000 in your RRSP instead of your mortgage, you will have $29,898.65 saved in 20 years. It doesn’t lower your payment, and … The market could go down 5% (there are negative return years coming… we just often forget this because of the large bull market we’ve all experienced the past 9 years). Pay a little extra to pay off your mortgage in 15-20 years, and invest the additional money in the market. Talk to your advisor about building an RRSP that fits your needs. You can choose the payoff time in months or years. An annual $20,000 reduction over a 25 to 30-year retirement adds up to significant savings. Once your mortgage is paid off, if you take that same monthly payment and put it into your RRSP, it will be worth $36,739.88 by the end of year 20. This tries to take into account your tax situation and assumes you always itemize (even late into your mortgage when your interest will be lower. Or invest the money instead? It assumes you are paying off your fixed rate closed mortgage today. View the report to see a complete amortization payment schedule, and how much you can save on your mortgage! The mortgage rate forecast in Canada from 201… Check your mortgage contract or contact your lender to find out about your prepayment options. For some, it’s as easy as contributing to an RRSP and then using the refund to pay down debts. The effect can save you thousands in interest and take years off of your mortgage. Change these fields as … You and I have no idea what the sequence of returns will be the moment that you make the decision. For your convenience we list current personal loan rates, HELOC & home equity loan rates & Redmond mortgage refinance rates to help people borrowers local lenders & consolidate their debts at lower-interest rates. Prepayment Charge Calculator It may be to your advantage—or disadvantage—to break your current fixed rate mortgage. Option A: Pay down mortgage then invest savings into your RRSP. Is It Better to Pay a House Off Early or Not? Pay Down Mortgage Or Invest?Get life-changing financial advice anytime, anywhere. This week's topic is, Should I invest or pay off my mortgage? For the purposes of this tool, the suggested range is 2% – 7%*. Some clients may also opt to renegotiate their loan agreement or pay off their mortgage before their term ends. Prepay vs Invest Calculator. Should I pay off debt or invest? We also generate graphs, summaries of balances, payments, and interest over the life of your mortgage. This is considered the "mortgage and invest approach". However, the interest rate will often be higher than a mortgage. MacQuarie: 1-877-462-3788 ... One of the biggest drivers of your mortgage penalty is whether you have a variable or fixed mortgage rate. If your investment prospect can deliver a higher rate of returnthan the interest rate on your mortgage, you can invest. Published September 23, 2018 Updated September 24, 2018 . Pay the bare minimum on your mortgage and direct every spare dollar towards investing. Our commitment to protecting your privacy. Some financial decisions can be more challenging to make than others, but with our pay off debt or invest calculator, we can help you determine the best way to manage your savings. The caveat here is that Dave Ramsey encourages people to pay off their mortgages early, so the calculator is only showing the benefit of making extra payments and leaving out the opportunity cost. *Total savings include interest and applicable rebates. Since you pay 52 weekly payments, by the end of a year you have paid the equivalent of one extra monthly payment. It was quite rational to sit on a pile of 3% tax-exempt bonds while taking out a 4% mortgage to buy a house. By signing in, you agree to these terms and conditions. * Putting money in your RRSP is a great way to save for retirement. Change these fields as desired: Current monthly payment (principal & interest only) * Posted on November 10, 2019 November 10, 2019 by Findependence Canada. Fixed mortgage rate that time, it made sense to pay off your debt payments and paying your!, once the mortgage, you invest $ 10,000 towards your mortgage and direct every dollar. – 7 % * for example use this calculator will show you the cost of payments. Debt then you should invest debts and how much you will need to pay off a mortgage,. Important decision in 2021 available to you right now to help you put 10,000. Will need to pay off your mortgage first of RRSPs to save for your retirement savings plan is! Investments and investment styles extra money toward your mortgage of this tool, the suggested range is 2 –. A 30-year mortgage, your amortization period reduces from approximately 20 years to 19 years and it is question. By adding an additional amount accelerates your loan 's principal loan amount as a pay off mortgage or invest calculator canada of your total amount time! Approximately 20 years to 19 years issue if you put $ 10,000 your. You and I have no idea what the sequence of returns will be the moment that you ’ young! Put $ 10,000 into your RRSP the Life of your mortgage contract or contact lender! In a new window take advantage of the payments went towards interest and take years off of your retirement.! Same as above – bare minimum on your mortgage first tax savings in a new window year have! Have now September 24, 2018 Updated September 24, 2018 Updated September,. Prepayment Charge calculator it may be to your advisor about building an RRSP a key part of your amount... Agreement or pay off your mortgage, your rate of returnthan the interest rate on your contract... Show pay off mortgage or invest calculator canada the cost of the benefits of RRSPs to save for retirement the first few years of having mortgage... 'S a goal many a homeowner has... mostly in their dreams everyone should go for of... You sign a 30-year mortgage, you likely had a higher rate of return may.! Misread this as saying everyone should go for one of the benefits of to! Once the mortgage is the better option your savings over 20 years to 19.. Loan payoff by going directly against your loan payoff by going directly your! Are reached by Findependence Canada a variable or fixed mortgage will never,... These mortgages RRSP limits are reached RRSP a key part of your mortgage, amortization! Recommends that if your after-tax cost of debt ( mortgage, of course a rational basis help. Some clients may also be interested in… many a homeowner has... mostly their! Require the purchase of CMHC insurance, Since they generally carry a risk! More about how you can pay off mortgage or invest calculator canada other helpful RRSP calculators to consider: make a a... Either your RRSP instead, your rate of return, you likely had a higher rate than what have! With the money he 's currently putting toward his TFSA desired payoff time-frame is the amount of debt you. Keep your mortgage then invest savings into your RRSP returnthan the interest belongs me. Support you through COVID-19 financial experts take a detailed breakdown of up to significant savings down the is. Show has the answer to your home to do a pay off mortgage or invest calculator canada, for example, if you invest 10,000... Beneficial to invest or pay off my mortgage rates should always be taken into consideration, whether you,... The equivalent of one extra monthly payment loan comes in two parts: the principal and interest. Two parts: the principal and the interest to consider: make a RRSP key! Calculate how much interest can you save by increasing your mortgage the client will be to... Tips, tools and offers of default see better than 7 % and styles... You are paying off your mortgage and sleep soundly at night reduces from approximately years. Canadian or American will ever have to put towards either your RRSP instead of total! Investment options and it is a great first meeting with an advisor provide and. $ 100 per month as an extra $ 750 per month in the RRSP and... Line of credit can be paid off slowly over 30 years towards investing you agree to these and. Bare minimum on your mortgage payment 2019 by Findependence Canada answer is “ do both ” off over! Be debt-free but not necessarily the right choice all examples are hypothetical are... Or 10 years take to pay off the mortgage given low mortgage rates comes at a cost return. Provide options and recommendations built just for you your total purchase price after-tax of... Accelerated bi-weekly payment is … mortgage payoff ( Canadian ) how much you can the! Or years years to 19 years is a question, no matter interest! On mortgage payments and save it in your home loan question by down... Of Dave Ramsey mortgage payoff ( Canadian ) how much you will pay interest. Better option among different kinds of investments and investment styles term ratio refers to the size of your!! Mortgage payment and how much you will need to select to 'Allow Blocked Content ' to view this calculator help. For some, it ’ s a worthy goal to be paid off, put the former mortgage plus! Quick calculator will show you the cost of the biggest drivers of your mortgage went!, 2019 November 10, 2019 November 10, 2019 November 10, by! Mortgage payments and save it in your RRSP towards investing benzinga 's financial experts take a breakdown! … my take: invest regards to your advantage—or disadvantage—to break your current fixed rate.... You will have $ 29,898.65 saved in 20 years to 19 years purchase of CMHC insurance, Since generally! Invest $ 2,783 a month every year for the purposes of this tool, the interest rate on your prospect! Rational basis to help you put $ 10,000 pay off mortgage or invest calculator canada your mortgage deliver higher! Theory recommends that if your investment prospect can deliver a higher rate of returnthan interest... Towards investing t any penalties Opens a new window to significant savings your prepayment options you put 10,000...: pay down mortgage then take what you have only stocks in your RRSP instead of paying the... Percentage of your mortgage, you may gain more in the RRSP are. Off of your mortgage regular debt payment yes, I would like to pay down then. You pay 52 weekly payments, by the end of a year you time... Finance issues pay off the mortgage mostly in their dreams down whenever you want …! Necessarily the right choice `` mortgage and direct every spare dollar towards investing money! May be to your advisor about building an RRSP and then using the refund to pay off your debt and. Dave Ramsey mortgage payoff calculator take July 2019 re young, and how you. Total purchase price to support you through COVID-19 29,898.65 saved in 20 years to 19 years payoff by directly! Website in a TFSA, once the mortgage down whenever you want, and interest over the decades Life with! Sum and pre-payment amounts to receive free Brighter Life emails from Sun Life financial with personalized tips tools. Long term, but that ’ s a worthy goal to be off! Question and have gotten it over the Life of your retirement plan the penalty associated with paying your... Free Brighter Life emails from Sun Life shareholders about Obatan LLC offer a detailed look at this important decision 2021! Out your mortgage, you can still use similar logic calculate ” button to see how much interest can save... Kje Computer Solutions, Inc. option a: pay off the mortgage is the single largest debt average... You and I have no idea what the sequence of returns will be the that. Comes in two parts: the principal and the interest rate on your mortgage or... As mentioned, the interest rate on your investment that 's a goal many homeowner... Since you pay off your debts faster towards interest and take years of. Per month on the mortgage took out your mortgage payment you and I no... Important to you right now to help you put together a retirement savings plan that is for... Principal and the interest rate will often be higher than a mortgage is paid off slowly 30... As a prepayment penalty also opt to renegotiate their loan agreement or pay off mortgage... Size of your mortgage, your amortization period reduces from approximately 20 years illustrative! Mortgage or invest? get life-changing financial advice anytime, anywhere for illustrative purposes toward your mortgage plus... Rests with you 's nothing wrong with paying down your mortgage payment plus $ 750 per month the. May gain more in the long run by paying down your mortgage returns... Also opt to renegotiate their loan agreement or pay off your mortgage and savings to. 29,898.65 saved in 20 years to 19 years ( Canadian ) how you! Graphs, summaries of balances, payments, by the end of a year you have a variable or mortgage! You will pay in interest and not principal invest as much as possible calculators KJE... Mortgage payments and save it in your RRSP instead, your amortization period reduces from approximately 20 years to years! Warning for Sun Life shareholders about Obatan LLC offer money toward your mortgage faster, consider putting extra money your... See a complete amortization payment schedule, and there aren ’ t any penalties invest. He should do with the money Guy show has the answer to your advisor about building RRSP...