Shawn is no dummy. He can see that paying interest is not so smart. So, Shawn starts saving his money. And Shawn makes a goal to pay off his mortgage. In Year 26, Shawn takes his savings and pays off his house. Boom! Congratulations, Shawn!!!
In January of year 26 of Shawn’s mortgage, after saving all his money for years and years, Shawn makes a payment of $80,760 and he pays off his house!
Shawn:
- Paid off his mortgage 5 years early
- No longer has a mortgage payment!
- No longer has a mortgage payment!!
- Will have an extra $1,580 in his pocket each month!
- No longer has a mortgage payment!
- You can’t overemphasize how cool this is.
And if you look at the end of the graph, you will see that Shawn:
- Paid off his mortgage 5 years early
- Has no mortgage payments for 5 years
- Will have an extra $1280 (monthly payment amount) in his pocket each month
- Saves interest payments for 5 year
- Will save $14,050 in interest payments
Paying off the mortgage is a pretty cool thing. And paying off the mortgage….. Pays!
Now let’s dig a little deeper with Shawn.