<prompt> Human: Hey! I hope this is the right sub-reddit.My parents own a house but still owe a Mortgage. I believe the Mortgage is 240k and change. My parents want to pay off 100k. Their mortgage was recently re-financed to a 3-4 interest loan I am not mistaken. 100k is a very large amount for my parents, so its not something that they could easily pay and think ah thats pocket change. The question is, would it make more sense paying off half of your remaining mortgage early or keeping the money in the Bank and earn the very lousy interest it gives nowadays? They currently pay about 2200,- a month in mortgage payments. Cutting the mortgage in half would reduce the monthly payments considerably.Also, if they decide to pay the 100k and would later need money again for a large purchase, how could they get back that money? Ask for another mortgage?Many thanks  <response>: They currently pay about 2200,- a month in mortgage payments. Cutting the mortgage in half would reduce the monthly payments considerably.Whys that? Usually reducing the balance on a loan doesnt reduce your monthly payment. Theyd end up saving a bunch of interest, of course, but their monthly payment would still be 2200. I could see if theyd be getting rid of PMI or something, but Im not sure if thats what you mean. Also, if they decide to pay the 100k and would later need money again for a large purchase, how could they get back that money? Ask for another mortgage?Why would they need 100k for a large purchase? If 100k is the entirety of their savings, then they shouldnt pay it all into the mortgage. Make sure they have sufficient liquid savings for emergencies and planned expenses. Otherwise, they could take a home equity loan if they needed to get money out of the house. To answer your original question, they need to consider whether they can beat the return provided by paying off the mortgage early. Putting that money towards the mortgage guarantees them a return equal to their interest rate adjusted for the tax credit theyd lose by paying less mortgage interest, etc. If the moneys just sitting in a bank account earning lousy interest then sure, its probably a good idea to pay down the mortgage. If theyre willing to do a little more active investing with that money, though, it might make sense to just keep making the payments on the mortgage and do something else with the 100k that will provide a higher rate of return. 