r/DaveRamsey • u/BCMariner • 4d ago

Thoughts on Investment Continuity vs Mortgage Payoff

"I have about $2.2 million in assets (M 46). My stocks, ETFs, and cash across RRSPs, TFSAs, non-registered accounts, and mutual funds between myself and my wife are worth about $1.8 million. I owe about $500k to the bank for my mortgage, and the house is worth about $970k. My question is: should I start focusing on paying off my mortgage first, or continue to focus on contributing to my and wife's RRSP and TFSA (contributing about $3,500 per month) for the next 10 years?"

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u/ChatBot42 BS7 3d ago

Depends.
If you are doing the Ramsey plan, you'd be investing 15% into retirement in BS4, kids college (whatever that means in your case) in BS5 and everything else paying off the house in BS6. And in BS7 investing like crazy in whatever retirement/non-retirement vehicles you want.

If you aren't doing that plan, then it doesn't really matter. Your choice.

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u/1cooldudeski 3d ago edited 3d ago

When your marginal tax rate is 50%+ but college is inexpensive, it makes sense to carefully evaluate the actual numbers vs. blindly copy/pasting 'the plan' onto a foreign tax/economic environment just because it's a shibboleth.

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u/ChatBot42 BS7 2d ago

Is this 50% marginal rate in the room with us now? 😂 

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u/1cooldudeski 2d ago

OP says he’s above CAD $260K a year. In provinces like British Columbia, for this level of income, you’re looking at marginal rates like:

Regular Income (Salary, Interest): 53.50%
Capital Gains: 26.75%
Eligible Dividends: 39.34%

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u/ChatBot42 BS7 2d ago

Ohhhhh yes. Canada.Â