Not sure this is the correct category for this post but let's see. Recently paid off all debt except for the 1st and 2nd mortgage. Now we are trying to figure out our next steps. We want to get into rental property in the coming years and potentially move from our house in 3 years after our youngest child graduates from high school. Our 1st is ~255k at 3.99%. 2nd has a remaining balance ~61k at 8.75%. Yeah that one hurts. More than likely we finally have some equity in our home again since the recession hit in 08. We were already paying 1400 a month on the 2nd prior to paying off the other debt. Paying off the debt freed up 1100 a month. My 401k contribution is already at 20k for the year and already completed my Roth IRA contribution for the year. We have roughly 6 months of living expenses saved up. I'm in a commission based job but live entirely off salary and direct commissions towards debt, savings, investing, etc.
We are trying to figure out some of these items:
Torn between paying down the 2nd mortgage as fast as possible to further free up cash flow and reduce leverage or take all current cash flow and direct it to savings for future investments.
Any suggestions are definitely welcome.
We are trying to figure out some of these items:
- Should we keep contributing to the 401k after tax and complete roth conversions each pay period
- Stop 401k contributions entirely this year and direct that money towards 2nd mortgage.
- Should we direct new cash flow (1100 a month) to savings to prepare for investment property or pay down 2nd mortgage?
Torn between paying down the 2nd mortgage as fast as possible to further free up cash flow and reduce leverage or take all current cash flow and direct it to savings for future investments.
Any suggestions are definitely welcome.
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