QUESTION: Is it worth paying off a mortgage early or saving?

The dilemma of what is more profitable—paying off a mortgage early or directing free funds to savings and investments—worries many borrowers. There is no universal answer here, as the decision depends on the interest rate on your housing loan and the current economic situation. If your mortgage is issued at a low rate that is lower than current inflation or the yield on bank deposits, then rushing into early repayment is economically impractical.

In conditions of a low credit rate, it is much more profitable to build a reliable financial safety cushion and place free money in high-yield deposits. In this case, you earn on the difference between the deposit rate and the mortgage rate while maintaining capital liquidity. Money in a deposit can always be quickly withdrawn in case of an emergency, whereas funds prematurely deposited into the bank cannot be returned without selling the apartment.

Things are completely different when the mortgage interest rate is high. In such a situation, every ruble paid off early guarantees to save you from overpaying the bank at that same high rate. Therefore, with expensive loans, early repayment often becomes the most reliable and profitable investment solution, reducing the overall financial burden on the family budget in the long run.