I'm 40, single, with a 16-year-old going to college soon (not really relevant I guess but that’s a picture of my life). I bought a house 10 months ago for $455k with 7% interest rate, and it has $116k left on the mortgage. I have no other debt.
I plan to keep this house forever because it’s near my business and my family, though I have a near-term goal of buying/renting a condo in NYC and splitting my time.
I’m self-employed and do not have any 401k/IRA/stocks/investments etc (just never figured it out, I know that’s bad). I currently have $220k in a 3.5% savings account and $20k cash for emergencies.
Should I use the funds in my savings account to pay off my mortgage? I hate having debt and I hate paying the monthly mortgage when I know I could just wipe that payment off my list. I’m paying about 5k/month toward my mortgage right now. I’d rather save that money to put it toward my goal of getting a second place.
I know that investments *can* pay off more, but given that I have pretty much no experience with investing, my gut says to pay off the mortgage to get basically the tax-free 7% return on the interest, and THEN tackle the next life challenge of learning to invest. Do you think this is wise? What should I do?