u/Pristine_Marsupial28

Hi, I’m debating the merits of:

1. paying down my 7-year adjustable rate mortgage (6.125%) with extra money vs

2. paying the minimum and keeping the remainder in a brokerage account with a mix of municipal MMFs, VT, and municipal bond ETFs.

I’m at the 35% marginal tax bracket, and I do not get state income tax breaks for muni. After calculating the tax equivalent yield on munis, paying down the mortgage (after the interest deduction), and (potential) long term capital gains on stock ETFs, it all seems to come out as a wash (everything is in the 3-6% range).

My goal is not so much to “make money” but to buffer myself in case mortgage interest rates shoot up after year 7, and selling off portions of my bond/equity ETFs makes sense to pay off the mortgage quickly after year 7.

Does anyone else use short or intermediate bond ETFs for these medium-term savings goals?

I’ve been looking at iShares MUB and SUB for this purpose (overall brokerage asset allocation would be something like 50% VT, 30% muni MMF, and 20% bond ETFs). I’m in my early 30s and my retirement accounts are all 100% VT, so the bonds would not be a significant part of my portfolio, but would at least allow me to diversity my medium term savings goals.

Thanks!

I’m one year out of training and hoping to buy a 3 bedroom condo in a HCOL area. Wondering if financially, this purchase makes sense.

Annual salary ~$450k, home looking to buy is $675k. Mortgage would be 6.25% with 5% downpayment, comes out to $4000 per month. (Additional $1500 per month in HOA, property taxes, and insurance would be covered by a family member who will be living in one of the three bedrooms). I love the condo and could easily see us living here at least 5-10 years (basically until either of us in married / has kids).

Currently rent 1 bedroom (that I had throughout residency) $2500/month. Family member rents a studio for $1500/month.

I’ve checked off the rest of my financial boxes (paid off 90% of my student loans, maxing out Roth/HSA/pretax accounts, all in VT). Emotionally I’m ready to move into a larger place and feel more settled/established, and I feel like the move would help both me and this family member. I’m also imagining that once the home is paid off, I’d feel more comfortable cutting back at work to maybe 0.6 FTE vs being subject to future rent costs.

Financially though, I ran the numbers and prepaying the mortgage (to avoid interest) still doesn’t beat the opportunity cost if I’d just invested in VT in a brokerage account.

Am I thinking about the purchase the wrong way? Thanks in advance!

Hello, I do tele-health mainly from my family’s home in the Chicago suburbs, but I have an apartment in NYC that I would also like to work out of on occasion (probably only one week of the month on average). The internet doesn’t need to be perfect, but it needs to be stable enough to not randomly drop video calls.

I’ve been paying for two separate internet home plans for $140+ together, but one of them is very spotty especially during storms — I’ve been looking into mobile internet plans (Starlink, Mobile), but don’t know how to choose.

How should I go about doing this?