What One Extra Mortgage Payment a Year Can Do
Extra principal payments can reduce mortgage interest and shorten the payoff timeline, but the benefit depends on the loan rate, remaining term and alternatives for the cash.
Change the inputs and compare scenarios with the related RetirementMetric calculator.
Open the calculatorHow extra principal helps
Interest is calculated from the remaining balance. Reducing principal earlier can lower future interest charges, assuming the loan has no relevant prepayment penalty.
Compare opportunity cost
Paying down a mortgage creates a return roughly related to avoided interest, while investing offers uncertain future returns and greater liquidity. Taxes can complicate the comparison.
Protect liquidity
Do not send every available dollar to an illiquid home balance without considering emergency savings and near-term cash needs.
How to use this number responsibly
Use the result as a planning range rather than a forecast. Re-run the calculation when your balance, contribution rate, debt, retirement date, tax situation or spending target changes. For investment projections, compare multiple return assumptions because future market returns are unknown.
What this calculator does not know
RetirementMetric does not know your complete tax situation, benefits, investment holdings, insurance needs or household expenses. The tools are educational estimates, not individualized investment, tax or legal advice.
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