Mortgage Payoff Calculator
Your mortgage is likely your largest expense. See exactly how extra payments can save you tens of thousands in interest and shave years off your loan.
Mortgage Calculator
Calculate your monthly mortgage payment including taxes, insurance, and HOA fees.
Monthly Payment
Total interest over years:
Turn This Into Your FI Plan
Create a free account to model debt payoff, future income, Social Security, changing expenses and more.
What If You Paid a Little Extra?
On a $300,000 mortgage at 6.5%, even small extra payments create massive savings. Drag the slider and watch the impact.
Slide to see the impact of extra monthly payments
An extra saves you in interest
Pay Off Mortgage or Invest?
One of the most debated questions in the FI community. Explore both sides.
Pay Off the Mortgage
Paying off your mortgage gives you a guaranteed, risk-free return equal to your interest rate. No market volatility, no sleepless nights.
- Eliminates your single largest monthly expense
- Reduces your FI number by 25x your annual mortgage payment
- Provides deep psychological peace and security
- No market risk — your return is locked in
Best when: Your mortgage rate exceeds 5-6%, you value certainty over potential upside, or you are close to FI.
Invest Instead
Historically, broad market index funds have returned roughly 10% annually, which exceeds most mortgage interest rates.
- Historical returns significantly exceed most mortgage rates
- Maintains the mortgage interest tax deduction
- Keeps your cash liquid and flexible for opportunities
- Mortgage debt inflates away over time with fixed payments
Best when: Your mortgage rate is below 4%, you have a long time horizon, and you can stomach market volatility.
Split the Difference
Many in the FI community take the balanced approach: maximize tax-advantaged accounts first, then direct remaining surplus toward the mortgage.
- Max out 401(k), IRA, and HSA first for tax benefits
- Direct remaining surplus to extra mortgage payments
- Hedges against both market downturns and high interest costs
- Captures tax advantages while building equity faster
Best when: You are uncertain about market direction, want balance, or your rate is in the 4-6% gray zone.
The FI Angle
Paying off your mortgage dramatically reduces your FI number. If your mortgage payment is $2,000/month, eliminating it drops your required portfolio by $600,000.
- $2,000/month mortgage = $24,000/year = $600,000 reduction in FI number
- Could mean reaching financial independence years sooner
- Fewer annual expenses mean a smaller portfolio sustains your lifestyle
- The math is simple: eliminate the payment, eliminate the need to fund it forever
The bottom line: A paid-off home is one of the most powerful accelerators on the path to FI.
Payoff Strategy Comparison
Toggle strategies on and off to compare their impact side by side.
Based on a $300,000, 30-year mortgage at 6.5% interest.
Frequently Asked Questions
Your monthly payment is calculated using the loan amount, interest rate, and loan term. The formula accounts for amortization, ensuring each payment covers both interest and principal. Property taxes and insurance are separate costs not included in this calculation.
Even small extra payments make a big difference. Adding $200/month to a $300,000 mortgage at 6.5% saves over $65,000 in interest and pays off the loan 6 years early. The earlier you start making extra payments, the greater the impact.
A 15-year mortgage has higher monthly payments but a lower interest rate and dramatically less total interest paid. A 30-year mortgage offers flexibility — you can always make extra payments to pay it off faster while keeping the option of lower required payments if needed.
Consider refinancing when rates drop 0.75-1% below your current rate, you plan to stay in the home long enough to recoup closing costs (typically 2-4 years), and your credit score has improved. Calculate the break-even point before committing.
If your mortgage rate is below 4-5%, investing historically provides better returns. If your rate is above 6%, paying it off provides a guaranteed return. Many in the FI community split the difference or prioritize the psychological freedom of being debt-free.
Join ChooseFI free
Save your tools, picks, and progress.
Takes 30 seconds
Ready to go deeper?
Model pension, Social Security, Coast FI, and debt payoff — see how they affect your timeline. 100% free.
Explore More Calculators
Explore more tools to help you on your financial independence journey.
FI Number Calculator
Calculate how much you need to retire.
Savings Rate
See how your savings rate affects your timeline.
Retirement Projection
Project your portfolio growth over time.
Future Value
See compound interest grow your money.
Amortization
Visualize your loan payoff schedule.
Tax Brackets
Federal income tax rates and effective rate.
Join the Community
Connect with others on the same FI journey.