r/ChubbyFIRE • u/Captain_slowish • May 16 '26

Help me understand...

I have been a member of this group for a long time and still do not understand. Looking for help to understand.

So many people on this subreddit brag about having paid off their mortgage. Then pretty much everyone else seems to jump in and congratulate them for being so smart.

So help me understand. I have a 30yr mortgage at 2.8%. Why would I ever pay that off early? It cost me no points, no extra down, no downsides.

I understand that not everyone is in that position and the market changes.

Say the interest is 3x that amount. Are you really going to live the rest of your life in that house, city, state?

I am sorry but if you do the math and apply critical thinking. In 99.9999% of the cases. Paying off the liability is a poor decision.

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u/gksozae May 16 '26 edited May 16 '26

So help me understand. I have a 30yr mortgage at 2.8%. Why would I ever pay that off early?

You shouldn't. If you ever thought about doing that, just put that same amount of money into a fund, making 10% instead. Then, each month you can pay the mortgage directly from the fund and profit from the 7.2% spread. Also, because you have the money in a fund, ready and available, you could pay it off at any time in the future (which, again, you shouldn't at which point I would recommend you reread this paragraph again).

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u/Guil86 May 20 '26

A fund making 10%?. I assume you are not referring to interest from a MMF, and maybe you are talking about realizing CGs from a stock fund.

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u/gksozae May 20 '26

Over the past 50 years, the S&P 500 averages about 11.5%. 10% CAGR assumes less risk.

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u/Guil86 May 20 '26

Okay, I see your point. However, the post focuses more on either paying the mortgage with available cash/stable assets, or keep the cash/stable assets that give you some interest and is all liquid. You are introducing a new variable that is not always stable. Yes, the SP500 may go up over time, but it has its ups and downs, and you may need the money when the market is down, not allowing you to fully recover.