One of the most common financial questions I have heard over the years, is whether it is better to pay down your mortgage or save for your retirement?

Recent behaviour indicates that many people have chosen to focus on paying down their mortgage vs saving for retirement.

 In my opinion this is a reflection of the time tested adage that money is about more than math. The emotional decision to seek out security over more financially profitable alternatives often takes precedence.

When you do take a look at the numbers; (particularly expected rates on return on your RRSP compared to the prevailing cost of mortgage debt) the decision definitely favours adding to your retirement savings.

Here is an excellent article that takes a look at the math, as well as the emotion.


 Coach Mark

How saving for retirement beats paying down your mortgage

​Saving for retirement beats paying down your mortgage. There – a long-standing debate in Canadian personal finance is settled. To build wealth in today’s low interest rate world, divert money you were going to use to pay down your mortgage balance to your registered retirement savings plan or tax-free savings account. This is the conclusion of a report to be issued Thursday called “Mortgages or Margaritas: Is Paying Down Debt Putting Your Retirement at Risk?”. Read on to see the proof.
Read more here

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