Should my priority be paying off my mortgage principal as fast as possible to minimize the interest?
I'm in my early 20s and just took out a mortgage (about 400k) on a 30-year fixed. Besides this mortgage, I am debt free of any kind. I'm trying to plan out how should I allocate my income for the next 10-20 years. I do max out my company's 401k matching, invest lightly in the stock market, and save some for emergency funds. But should I pour the rest of my capital into paying off the principal? What if I get some bonuses?
First off, great job on starting to plan at your age, many of your peers are not thinking that far ahead. As for what to do, depends on your goals. If you goal is to be debt free then yes, pay off the mortgage with your extra dollars. You are saving in your 401K (wasn’t sure if you were putting in the match max or the plan maximum closer to $18,000 in 2016), have an emergency fund and building up some additional assets, then the next place to go is your mortgage.
If your goal is to not be debt free but to just find a home for the dollars. Look to maybe add an outside of work IRA or Roth IRA account as well as building up your outside investments a little more before attacking the debt. But personally I love debt free status.