What would you do with $200k?

[Lost Boy]

Say $200k landed in your lap tax free and tithing has already been paid on it...  Also, you have a $200k mortgage, however, you also have a decent job that you can afford the mortgage payments.  You are also 20 years from retirement. 

What would you do with that money? 

[Overwatch]

30 minutes ago, Lost Boy said:

Say $200k landed in your lap tax free and tithing has already been paid on it...  Also, you have a $200k mortgage, however, you also have a decent job that you can afford the mortgage payments.  You are also 20 years from retirement. 

What would you do with that money? 

If you can pay off the mortgage without a penalty then pay off your house OR buy another off of the foreclosure auction. Sell the one you are living in or hire a third party company to rent it out to people. Fix up the auction house purchase and just live there. If your original never gets rented sell that thing.

Then use all of your future earnings to do whatever you want. Best idea is to pretend like you never got it. Once you get the foreclosed house CASH you will have a lot leftover. Put it away for a rainy day. Also if you have any debts pay it all off including your car note.

 

Edited June 3, 2018 by Overwatch
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[askandanswer]

The way the tax and superannuation systems work here in Australia, in the long run, money put into your retirement savings account will yield a greater return than money paid into your mortgage. But its a highly complex system and there's no reason to believe that the laws and principles that apply in Australia will apply equally well in your part of the world.

[mirkwood]

Pay off the mortgage and then take your now former monthly house payment amount and start investing that money for the next 20+ years.  You are already used to not having that money for other things, so put it to work for you.

[Fether]

3 hours ago, Lost Boy said:

Say $200k landed in your lap tax free and tithing has already been paid on it...  Also, you have a $200k mortgage, however, you also have a decent job that you can afford the mortgage payments.  You are also 20 years from retirement. 

What would you do with that money? 

Buy a $400,000 summer home

[Lost Boy]

2 hours ago, askandanswer said:

The way the tax and superannuation systems work here in Australia, in the long run, money put into your retirement savings account will yield a greater return than money paid into your mortgage. But its a highly complex system and there's no reason to believe that the laws and principles that apply in Australia will apply equally well in your part of the world.

This is what I would be more inclined to do.  Invest it in a diversified bunch of funds.  Mortgage rates are around 4% here.  I have over the past 10 years averaged 18% on market investments.  Even if I only do 10%, that is a whole lot better than 4%.

 I hear a lot of horror stories of people investing in one or two companies and then losing it all.  That seems like a crazy way of doing things.  Get a good portfolio and keep it diverse. 

There is still the chance that all could go south.... lose the job, the market drops, housing market goes to crap, etc.  But I would think it is worth the risk.

But the real question is....  would you sit on the money expecting the market to go south?  And of course once it goes South, you put it all in the market...   Or do you just put it in right now?

[seashmore]

7 hours ago, Lost Boy said:

Say $200k landed in your lap tax free and tithing has already been paid on it...  Also, you have a $200k mortgage, however, you also have a decent job that you can afford the mortgage payments.  You are also 20 years from retirement. 

What would you do with that money? 

I wouldn't spend it all in one place.  $100k to the mortgage, $50k to retirement, and $50k to savings/charity/a fun purchase (family vacation, upgrade vehicle, home reno project, paying for someone's mission, their student loans, etc.)

[Guest]

20 hours ago, Lost Boy said:

Say $200k landed in your lap tax free and tithing has already been paid on it...  Also, you have a $200k mortgage, however, you also have a decent job that you can afford the mortgage payments.  You are also 20 years from retirement. 

What would you do with that money? 

Easy.  Pay off the mortgage.  No question.

[Guest MormonGator]

Pay off the mortgage, then place the remainder of it in various investments. 20 years from retirement is like two weeks. 

Edited June 4, 2018 by MormonGator

[anatess2]

Depends on how much interest rate your mortgage is charging you and how much interest rate you expect to get out of your investments in the next 20 years.  Ideally, you would want to have that mortgage paid off before you retire.  And 20 years is a long time - you could possibly lose your job.  So, basically you want to factor in the risk factor of holding a job in addition to market volatility on your investments.  If in your calculations your return on your investments is higher than the mortgage interest factoring in your job risk, then you go invest your money and put a 20-year-or-less plan on paying off your mortgage.