<prompt> Human: After putting the down payment on my home and allocating funds for my taxes, I am sitting on approximately 35k. Would I be considered dumb for taking a large amount of my money and putting it towards my principle instead of investing?Assistant: It is not dumb, but it might be ill advised.If you want to pay off the mortgage, I suggest you invest the money conservatively and add more to it, until you have enough money to pay off the mortgage in one fell swoop.This will be safer. If you pay off the mortgage a little at a time, the duration goes down, the total interest you will pay goes down, but the monthly obligation remains the same.If you run into a financial emergency, you still need to meet that obligation or risk foreclosure.If you have been investing money towards paying off the mortgage, you still have all that money instead of the bank having it to help extend the time you can make your mortgage payments and give you more time to recover from the emergency.If you dont have an emergency, you can pay off the mortgage when you have enough money, and the mortgage and the obligation go away together.Furthermore, because the returns from investing will probably be higher than the interest rate on the mortgage, you will likely be able to pay off the mortgage sooner, and pay less total interest than if you had paid off the mortgage in bits and pieces.Good luck.Human: Thank you very much. I never though about the payment staying the same regardless. New perspective on this topic.  <response>: Glad to give you a new perspective.People obsess on this sub about the merits of a risk free return from paying down the mortgage vs. a riskier but usually higher return from investing.But that whole debate does not cover the real risk of a mortgage, which is the risk of defaulting and getting foreclosed on. In a foreclosure, the banks only interest is in selling the property as fast as they can and recovering as much of their loan as possible. They dont care about getting top dollar and paying you out your equity. Plus, they incur all sorts of legal fees etc. which they will recover against any share of the sale price which should have gone to you. You wont get much back from a foreclosure regardless of how much equity you have in the house.I know, because I came within inches of getting badly burned by paying extra every month on a mortgage once. I squeaked through that, and managed to recover from the emergency in the nick of time, but it made me sick to think how much more cushion I would have had if I had just invested those extra monthly payments and had them to draw on instead of giving them to the bank.After that, I learned my lesson. Never pay down a mortgage. Invest and pay it off. I now own 3 properties, all with no mortgage, worth collectively just under 5m, and I paid off all those mortgages by investing and paying each of them off in one fell swoop, rather than paying them off in bits and pieces.I am so glad I learned that lesson without it costing me a fortune.Good luck. 