(2) No Emergency Fund
It is one of the best reasons for not paying off your mortgage quickly. You should always maintain a handsome emergency fund of 6-12 months cash reserve for an unexpected expenses or major setbacks like unemployment or job loss, etc. that may hit your life anytime.
If you feel that paying off housing debt takes priority over your savings. You should protect your biggest investment that you have made in form of mortgage. But what about your savings account without cash?
If you have plenty of cash left in your emergency fund to handle any untoward situation in life than paying off housing debt is not a bad idea.
But if you don’t have any emergency savings, than it will be much better option to first generate good amount of emergency funds in your life & then think for paying off investment debts.
(3) No Solid Retirement Plan
It is one of the most common reasons for not paying off your mortgage quickly. If you are still working then you should have a solid retirement plan. It will help you put on a safer side during old age.
It will be a much better option to add extra dollars to a tax-favored retirement accounts such as IRA, or a 401(k).
Once you have contributed enough to your retirement plan than only you should start looking to pay off your mortgage debts quickly. If you don’t have a solid retirement plan then it makes no sense to prepay housing debt quickly without planning for your future in old age.
You can also take the help of investment professionals to explore new investment options for your future.
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