Radical Personal Finance 417-Friday Q&A: Should I Follow Dave Ramsey's Baby Steps and Pay off My House Early, I Had an Unexpected Child...Should I Finish Graduate School or Drop Out to Be a Mom?
Jan 20, 2017
This lively Q&A session tackles pressing financial questions from listeners. One caller debates whether to follow Dave Ramsey's baby steps or prioritize their family's needs over mortgage payments. Another shares her struggles balancing motherhood with graduate school, weighing emotional and practical challenges. The conversation also delves into zero-based thinking, prompting listeners to reassess choices based on values and personal circumstances. It's a mix of finance, family dilemmas, and the quest for fulfillment.
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Prioritize Mortgage Payoff Carefully
- Decide to pay off your mortgage early if you have no better use for the money with higher guaranteed returns.
- Prioritize peace and security over theoretical investment gains if your mortgage interest rate is moderate and nondeductible, like in Canada.
Compare Rates Before Prepaying Mortgage
- Compare your mortgage interest rate to possible returns elsewhere before deciding to pay extra on your home loan.
- Paying off the mortgage with the highest interest rate first often makes most financial sense.
Value of Cash Over Early Mortgage Payoff
- Keeping cash liquid can offer more financial security than reducing mortgage principal by the same amount.
- Liquid savings cover payments during emergencies without risking loss of financial flexibility.