This is a simple script to compare two strategies for mortgage payments:
- 30 year plan
- lower monthly payments
- more total paid toward mortgage
- Strategy: invest money that is not being spent on higher payments for entire 30 years
- 20 year plan
- higher monthly payments
- less total paid toward mortgage
- Strategy: invest money that is not being spent on mortgage for last 10 years
The conclusion is that spending less monthly on a mortgage means losing less money overall due to 30 year investments being significantly more lucrative.
Total spend:
- 30 years: $455760
- 20 years: $399600
Additional spent with 30 year mortgage: -56160
Total spend after mortgage and investments:
- 30 years: $-121745.34
- 20 years: $-198962.49