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Author: monica3674 One star, 50 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 5069  
Subject: Re: Update and next step(s) Date: 1/16/2004 10:05 PM
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My DH and I were in somewhat of the same position. We have about 3k that we can invest each month. I am planning to stop working at the end of the 2004-2005 school year. It would be nice not to have the mortgage payment to make each month b/c all we will have then is DH's salary.

What we did was refinance to a 10 year mortgage @ 5.375%. Our first payment was like $640 principal, $460 interest. We don't pay anything extra toward the principal. Instead, we put $2k/month into our Ameritrade taxable account, 600/mo in VTSMX (taxable), $300/mo into 529 plans, and fully fund our Roths and DH's 401k.

This way, we can benefit from the higher (usually) investment gains in the stock market, but if we need money for some kind of emergency, it is there for us to withdraw.

When we were first married, we aggressively paid down the mortgage. We started at 135,200 (15yr, 8.25%). Fortunately, from June 2000 until probably June 2002, most of our extra money went to the mortgage. What we did put in the stock market is just now getting back to the levels we bought it at.

Think about a 10 year mortgage. You get many of the benefits of prepaying the mortgage, but you've still got extra money to put in the market.

Monica
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