Episode 3 of 6
The Mortgage Payoff vs. Invest Verdict
Will runs the full 20-year model. Paying off the $142k mortgage at 6.1% saves $98k in interest. Investing $142k at a historical 9.5% average yields $480k after tax. But the Monte Carlo shows a 22% chance the investment path underperforms the guaranteed payoff.
Key Insight
The expected value of investing is $238k higher than paying off the mortgage, but there is a 22% probability of underperformance. Will splits the difference: $100k toward the mortgage, $80k invested — reducing his monthly payment by $620 and still capturing most of the upside.
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