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<<<1. They carry a mortgage on their homes even though they can afford to pay it off. Keep your money working for you. Every dollar paid to the bank is one less that you have to invest. Your house will grow in value no matter what.>>>

I highly disagree with this advice about carrying a mortgage, and I'm speaking from a position of experience. Two years ago I started a new job and wasn't eligable for the pension plan in the first year. Therefore I decided to set aside that "extra" money and start working on paying off the mortgage. After one year, I had saved enough to pay off the mortgage, 20 years early. I thought long and hard about what to do, mortgage or stocks, after all the market was screaming high returns. I studied all the arguements, pros and cons, and stayed true to my nature of fisical conservativism and payed off the mortgage, time November 1999.

Of course hind sight is 20/20, but even if the market would've returned 50% last year, there is nothing like the peace of mind of owning your own home. That and the freedom of being able to tell your boss/world to take a flying leap. I work because I love it, not because I have too. I still have my money working for me, what was once my mortgage payment is now my monthly investment money.

JLC


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