Personal Investments • Pay off remaining mortgage with IRA $ or Non-IRA Brokerage acct.

If I were in your shoes, I’d go for paying off the mortgage with the emergency fund. It’s a guaranteed return of 7%, which is better than the risk of investments. Sure, it’ll leave you with only $67K in the emergency fund for now, but building it back up should be doable with your income.

The guarantee return of 7% exists with withdrawal from IRA too.

But isn't withdrawing from the IRA a completely separate decision? Pay the mortgage off with the spare cash on hand tomorrow. If you want to replenish cash reserves, draw some extra money out of the IRA now, and more next year, if that's advantagous for long term tax planning. I don't see the linkage.

Pay from emergency fund, but replenish through withdrawals from IRA
vs
Pay from IRA directly

What's the difference? Left pocket vs right pocket ...

The increased tax bracket from 22% now to 25% in the future is the driving reason why I propose settling the mortgage from the IRA.

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Edit: actually never mind. I think I got what you are saying; pay off the mortgage in entirety NOW, and withdraw from IRA next year. I can get behind that ... (though, it only saves 7% interest on 3 months for 2024, which I admit is still $2400 approximately, nothing to sneeze at).

Statistics: Posted by lakpr — Sat Sep 14, 2024 6:35 pm — Replies 18 — Views 576

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