I have $5000 that I can invest in the home we are buying by paying down the principle by that amount after we close thus reducing the 30year loan by a few years. P & I on the house is $750/mo. My other option is to invest the money in a Roth IRABy prepaying the mortgage you'll probably get about a 4-5% return (depending on your mortgage APR and your income tax rates) on your money since you're reducing tax deductible interest payments.Investing in equities via a mutual fund in a Roth IRA (with tax free withdrawal of both contributions and gains) will likely, over the long term, produce twice those returns (based on the long term average return on equities of about 11%).I'd agree with the earlier post, which suggested putting $2,000 each into Roth IRA's for yourself and your spouse, then perhaps using the remaining $1,000 towards debt repayment. You might even consider saving the $1,000 towards additional Roth contributions in 2002. There is legislation (Portman-Cardin) on Capital Hill that, if approved, will increase the maximum contribution limits for IRA's. It has wide support in both the House and Senate, but has in the past been tied up with more controversial budget and tax issues. Bush will surely sign it if it reaches his desk, but he seems to have other priorities at the moment. You might want to contact your Senators and Representatives to voice your support.http://www.passpensionreform.org/
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