Payoff Mortgage Early Or Is Massive Inflation Coming? (funds, pay, million)

[NJBOSCH]

In the past I've always paid additional money each month against my 30 year mortgage. However the ever growing budget deficit in the United States and Europe has caused the Central Banks to turn on the printing presses. Many economists and financial analysts I follow believe this is going to end badly in massive inflation and/or the collapse of the dollar. The odds of that 30 year mortgage being "inflated away" or wiped out by a dollar collapse sometime over the next 20 years is looking more and more likely.

Given that, I'm now wondering if throwing extra money at a 30 year mortgage is a bad idea. That same money can be used to by hard assets such as gold or commodities which are capable of keeping up with inflation.

Any thoughts on this? Has anyone else begun to question the wisdom of trying to payoff a low interest rate 30 year mortgage given the US and world debt situation?

[MadManofBethesda]

Originally Posted by NJBOSCH

Many economists and financial analysts I follow believe this is going to end badly in massive inflation and/or the collapse of the dollar.

So, which whack-jobs on the internet and/or talk radio do you follow?

[CSD610]

Originally Posted by MadManofBethesda

So, which whack-jobs on the internet and/or talk radio do you follow?

Which ones do you think are what-jobs? (Just curious)

[CSD610]

Originally Posted by NJBOSCH

In the past I've always paid additional money each month against my 30 year mortgage. However the ever growing budget deficit in the United States and Europe has caused the Central Banks to turn on the printing presses. Many economists and financial analysts I follow believe this is going to end badly in massive inflation and/or the collapse of the dollar. The odds of that 30 year mortgage being "inflated away" or wiped out by a dollar collapse sometime over the next 20 years is looking more and more likely.

Given that, I'm now wondering if throwing extra money at a 30 year mortgage is a bad idea. That same money can be used to by hard assets such as gold or commodities which are capable of keeping up with inflation.

Any thoughts on this? Has anyone else begun to question the wisdom of trying to payoff a low interest rate 30 year mortgage given the US and world debt situation?

Suze Orman says not to buy gold (I caught her program a few days ago on television, I had insomnia).

Dave Ramsey says to pay off all debt including the mortgage, save, invest and have an emergency fund and a minimum 3 months expense saved as well.

[NJBOSCH]

Originally Posted by MadManofBethesda

So, which whack-jobs on the internet and/or talk radio do you follow?

I've actually heard this theory from quite a few investors and/or financial advisors. Among them:

Jim Rogers
Peter Schiff
Nouriel Roubini
Steve Cordasco
Marc Faber
Porter Stansberry
Jason Hartman

I too listen to Dave Ramsey but find his message a bit unsophisticated. Take a hard look at the US debt situation, it's too large to paid off by any other means than to inflate it away by printing dollars. For that reason I question if its still.a wise choice to use today's dollars to payoff low interest fixed rate debt.

[mathjak107]

Well the signs on the horizon right now show deflation more than inflation as a worry for at least the next 5-10 years .

With certain commodities sucking what little descretionary income out of our pockets we have ,anything we buy is at the expense of not buying something else .
There may have beeen massive amounts of money printed but its sitting in bank reserves and not in my hand ,your hand or anyone else i know.

We are all buying this instead of that and not this and that and thats deflationary.

[springazure]

FOOD prices... it's like a steep roller coaster going uphill. Now add the severe droughts of TX, which will have a serious effect on beef prices. This winter Midwest farmer fields are lacking snowfall. That means they will start the spring planting season in a drought.

You want to beat inflation? STOCKPILE FOOD!

[mathjak107]

all it means is we risk slowing down because with no raises and high unemployment we will all have less money to spread around for other stuff.

inflation is when we have more money to spend at the same time everything is going up so we buy this and that ,not like now where we buy this or that.


Europe will need lots of capital from their central banks and raising capital involves selling other stuff. selling is deflationary as well......

[dbbd]

Originally Posted by NJBOSCH

I too listen to Dave Ramsey but find his message a bit unsophisticated. .

That's probably because the people who NEED his advice are as well....at least when it comes to managing their money.

Of course there are exceptions - some just have bad luck, especially in the housing market.

And it's not a knock on those who find/found themselves drowning in debt. I've paid my share of stupid tax.

[hml1976]

Originally Posted by NJBOSCH

I too listen to Dave Ramsey but find his message a bit unsophisticated.

Well, I have a finance degree and worked (briefly) in investment banking and I think personal finance for 99% of the country IS pretty unsophisticated and should be. Heck most multi-millionaires, my parents among them, should imo just have basic investments and no debt.

But back to your original question. We're working on paying off our mortgage. I figure I owe it, I want to get rid of it, I'm not going to play the what if game. I'm not emptying out my retirement funds to pay it off but I'm putting a lot extra on every month. But, I do believe that inflation is coming, I'm just not sure when and I'm not going to be burdened with a big mortgage waiting for it. Many of those same economists have been predicting inflation for 5-10yrs, that's a lot of interest paid.