<prompt> Human: Housing cost - interest and mortgage- are probably 30 to 40 of my current income after taxes. At the same time, IF, a big IF here, if I were to cash out my 401K, pay taxes and the 10 penalty, I still will be able to pay the house up front. In my mind, having that 30 to 40 income available is an interesting proposition as it could be invested, and start the circle again. But, I will be debt free now. Does it make sense to do this? Why would I wait until Im 68 years old to cash out while still having to pay mortgage and interest for another 25 years or so? The idea of owning a house now, and not having the recurring cost, plus having the additional extra income is quite interesting. Thoughts? Comments? Ideas? Assistant: Whats the interest rate of your mortgage? Lets say its 4.5. Cashing out your 401k has a 10 penalty and taxes.So are you willing to pay 10 penaltytaxes in order to pay a mortgage thats under 5?Human: 4.2. Agree, the penalties alone are a hit. However, math aside, wouldnt it be a life changing event not to have a mortgage anymore? Ever?  <response>: Its also life changing to not have a retirement. 