1080 – This can help save you money: Tom talks Paying Off Your Mortgage Early

SUMMARY BY CHATGPT

Main Topic
Tom discusses the pros and cons of paying off your mortgage early and explains how doing so saved him approximately $200,000 in interest by paying it off five years ahead of schedule.
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Key Points
✅ Pros of Paying Off Your Mortgage Early
1. Major Interest Savings
o Mortgage interest is “front-loaded,” meaning you pay much more interest in the early years.
o Even small extra payments toward principal (e.g., $50–$100/month) can significantly reduce total interest.
o The earlier in the loan you start, the more you save.
2. Improved Long-Term Cash Flow
o Once the mortgage is paid off, you eliminate a major monthly expense.
o This provides financial freedom and flexibility.
3. Psychological Benefits
o Being debt-free reduces stress and financial pressure.
o Greater peace of mind, especially if business slows down or you want to reduce workload.
4. Flexibility
o Extra payments are optional—you can pause if needed.
o Every little bit toward principal helps.
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❌ Cons of Paying Off Early
1. Opportunity Cost
o If you have a very low interest rate (e.g., 3%), you may earn higher returns by investing instead.
o Business investments could yield much greater returns (9%–30%+).
2. Reduced Liquidity
o Money paid into home equity is not easily accessible.
o Accessing it later may require a HELOC or second mortgage, often at higher rates.
3. Inflation Advantage
o Over time, inflation reduces the real value of fixed mortgage payments.
o Paying later with “cheaper dollars” can be advantageous.
4. Short-Term Cash Flow Reduction
o Extra payments reduce available cash in the present.
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Overall Message
Paying off your mortgage early can save a substantial amount of money and provide psychological and financial freedom — but it depends on:
• Your interest rate
• Stage of life/career
• Cash flow
• Investment opportunities
• Retirement timeline
Tom emphasizes evaluating your personal situation and consulting financial and tax advisors before making decisions.
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Bottom Line
If you have strong cash flow and limited better investment options, paying off your mortgage early can save a “boatload” of money. But if you have low interest rates and strong investment opportunities, keeping the mortgage may make more financial sense.
If you'd like, I can also give you a one-paragraph version suitable for show notes.

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Episode 1080 – Paying Off Your Mortgage
[00:00:08] Welcome to Screw the Commute. The entrepreneurial podcast dedicated to getting you out of the car and into the money, with your host, lifelong entrepreneur and multimillionaire, Tom Antion.
[00:00:24] Hey everybody, it's Tom here with episode 1080 of Screw the Commute podcast. Today we're going to talk about paying your mortgage off early. Now, if you don't have a mortgage, this may not apply to you, but it's something you want to think about when you do get one. Hope you didn't miss episode 1079. That was the ins and outs of charitable donations to get yourself tax deductions and do some good in the world, and make sure you pick up a copy of our automation book at screwthecommute.com/automatefree. Make sure you get version 3.0. That's the latest, and check out my mentor program at GreatInternetMarketingTraining.com and my school at IMTCVA.org. Hey, I always have to say this because it's certified to operate by SCHEV and they demand that I say that. Okay, that's the State Council on Higher Education in Virginia. But you don't have to be in Virginia because it's quality distance learning.
[00:01:22] All right. Let me tell you about the numbers here to make you really think about this. Now, I saved around $200,000 in mortgage interest by paying my mortgage off five years early. Now, had I been thinking about it years and years ago, you know, I was flying all over the world, you know, speaking and doing, you know, 70 to 80 new students every couple months.
[00:01:51] And, you know, so I wasn't really thinking about it, but had I thought about it earlier, like I'm trying to convince you to think about, I would have saved about Thousand dollars in interest. All right. So. So today I'm going to give you a quick pros and cons list of paying things off early. Of course, mortgages rarely have a prepayment penalty for paying it off early, so you don't have to usually worry about that. And again, all this kind of stuff, you always check with your tax advisor and your financial advisor rather than just listening to me. All right. So what's the pros and cons of paying your mortgage off early? And I got to tell you, I'd rather have that interest money in my bank account than theirs. Right. So some mortgage company. So anyway, one of the big pros is you'll save interest, and it can be enormous amounts just by adding a little bit extra to your principal payment each month. And one of the reasons the newer the mortgage, the more you're going to save, because interest is usually what they call front loaded at the end of my mortgage. My, you know, it might have been a $5,000 mortgage payment, but I paid $70 in interest for that month. But in the beginning, I might have paid $4,000 in interest.
[00:03:16] All right. So the more you can knock the principle down in the beginning, the better, but it can be as little as $100 extra a month or 50. It depends. I mean, anything is better than nothing to keep knocking it down faster if you can afford to. So it saves interest. Now one of the the pros is in the long run it increases cash flow. But kind of along with that in the short run it reduces cash flow because you're paying more money into your mortgage every month. So it kind of reduces your cash flow. But once you get to the point where it's paid off, man, it's really great. And that brings in one of the big pros is the psychological part of it. It's just, you know, I've been consumer debt free for a long time. Doesn't mean I don't have any loans, because I have some rental properties and things, and I want to keep mortgages on those properties and just take advantage of the cash flow. But really, it just feels so great to not be under the gun on mortgage payments. Doesn't. Now the the other. Well, when we get to the cons, you do have to keep track of your taxes and insurance, which is normally the mortgage company takes care of that for you while you're during the your mortgage. But anyway, another thing is if if business slows down or I just feel like taking a break, like I in the last couple years I've been just doing a lot of my own fun stuff and just taking the money from the business, not pushing real hard.
[00:04:53] You don't have to worry so much if that thing is off your plate. And if you are paying extra monthly and you have a long way to go on your mortgage, you don't have to do it every month. If something comes up where you need the money, you know, it's just every little bit that you can chip down, especially near the beginning. The better off you are. All right, so what are the cons? Well, let's say you locked in, uh, you got a mortgage a while back, and you locked in 3% or something. Well, you can usually do better than that by investing. I mean, even the, you know, some of the the higher interest CDs and things will pay 4%. You got to watch for those kinds of deals. But if you invest in your business and you can get nine, ten, 15, 30%. Well, it's better off to use the money to invest rather than pay it down on a mortgage if you have a real low mortgage interest rate. So that's a con. If you if you're paying all the money into the mortgage, you don't have that money to invest.
[00:05:58] And then your money is locked up in your equity and your, your home or business or whatever you're mortgaged on. So you can't access it easily unless you get like a HELOC or a home equity line of credit. I think that's what it stands for. And or second mortgages, things like that, which are usually higher interest rates. So you do tie up money in equity. Another thing that a lot of people don't think of is you lose your inflation advantage. Now most people don't think inflation has advantage. You know in those same in the same sentence, those words inflation and advantage. However, in this case, if you don't pay your mortgage off or if you do pay your mortgage off, you're paying it in dollars that are worth more than they might be down the road. When if you keep the mortgage and pay it off later in dollars that are it's the same mortgage payment unless you got one of those variable ones, which is very dangerous to do, but you're paying it off in dollars that are worthless even though you're paying the same amount. That's called the inflation advantage. So to me, that one's a you know, I'd rather have the psychological advantage of not having any debt and not being under pressure to make big payments every month. So so that's some of the cons of paying it off early, but something you want to consider because it can, um, like I said, save you.
[00:07:34] In my case, it saved me about $200,000 in interest just by, um, paying it off early. Five years. Early pay. Ten years early. Boy, it could be even way more than the 350,000. But again, like I said, I wasn't thinking about it in those days, but I had the cash flow. That's why I look back and say, ah, man, I messed up because the cash flow was already there. It's just that I just, you know, dutifully paid the mortgage payment every month. And then think about this, because I was so busy running the business and taking care of students and traveling all the time. So if you have some cash flow, it may be a really good idea for you to do this. But again, check with your financial advisor. Look at all these pros and cons because all of this is where you are in life. Is it a new mortgage? Is it an older mortgage? What's the interest rate? What's your cash flow now? What's your cash flow likely to be in the future? Are you getting ready to retire or are you just starting your career or in your mid-level career? See, all of these are factors, but it's something I really want you to bring up because it can save you a boatload of money in the long run.
[00:08:47] And if you're not hurting in the short run for money, it may bring you back a return way bigger than you could have gotten. So. So that's my story, and I'm sticking to it. If you'd like help on this and a million other things it takes to be successful in business, check out greatinternetmarketingtraining.com that's my mentor program. And if you're in my mentor program you get a scholarship to my school, the the only licensed dedicated internet and digital marketing school in the country. Probably the world and its quality distance learning. So it can be done in conjunction if you're working, if your kids are already enrolled in four year, you know, concentration camp, I mean, four year college, I mean, the the I'm just so against the four year colleges now is they just teach you how to protest. But anyway, it can be done in conjunction with that or in, uh, you can skip that and save yourself a boatload of money and have an actual skill that's in high demand. So check that out at IMTCVA.org and contact me. I'm easy to get along with or to get a hold of, and there's no high pressure here. You know, I'll be glad to answer any of your questions with no pressure. All right. That's my story and I'm sticking to it. We'll catch you on the next episode. See you later.