Debt is a killer in general but a mortgage is one of those necessary evils that follows you around for a long long time. Over here owning a house is the be all and end all of growing older.
Until you have a bit of property and security then you have nothing.
Unfortunately the whole set up is a big scam. You can borrow the money if you follow all of their rules and tick all of their boxes but the banks will charge you well for it. Almost double in fact.
Inflation might be 20% but the banks charge you 50% interest on the money that you borrow from them. We have 320K on our house over 30 years but will have to pay the banks 600K for it if we go the full term.
The first years are the worst where you pay about 90% of your repayments towards interest and only 10% actually goes towards paying off the debt.
The only way to make it worthwhile is to pay it off as early as possible with extra lump sums every year which will be taken off the principle. Not an easy feat.
But worth the effort if we ever want to get debt free and will save thousands in the long run. Saving hard now and paying off the principle is worth a lot of money over the life of the debt. They say 3% but that's only a cover for the true cost.
If paying off your mortgage early shows you one thing, it’s the power of compound interest. By paying down your debt, you’ve saved having to pay a huge amount of additional interest. Now, the tables are turned.
When you’re saving money rather than borrowing it, compound interest works in your favour.
Many people who have focused hard on paying down their mortgage quickly are investing for the first time.
A regular monthly drip-feed, into professionally managed funds designed for growth over the medium term, could be just the approach you need for your next financial milestone.
Ref: Moneycube
All debt is dangerous and can spiral out of control is unpaid but at least a mortgage has a set schedule. Unlike credits cards or overdrafts where the principle can go crazy if you don't meet your responsibilities.
Mortgage free by 50. That's the plan or sooner if one or more of my crypto investments comes up big and speeds up the process. Every year is a chance to knock down that debt and remove the weight from our shoulders. Then we can turn the tables and start investing that money every month.
Shares with a dividend payout. Property in the local cities for rent. Even more crypto if possible. Build as many sources of revenue as possible for the future and live out the following twenty years playing gold and drinking pints. Maybe even bring the wife. If there's space.
In some countries they rent more than but but for me that's an even greater waste of money. Dead money down the drain. We might have to overpay for the house now but in 30 years it will have held it's value and then some while that money in a bank would have only lost it's buying power.
An easy choice for me.
