I recently went to a financial planner who told me I should not pay off my mortgage. Instead, the financial planner said I should have her invest the $1,200 I’m overpaying on my mortgage.

I recently refinanced my loan of $198,000 at 4-3/8% on a $400,000 house. I plan to increase my overpayment each year as I get raises, so that I can pay off my loan in five years.

I’m almost 60 years old. What do you think? Do you think any financial planner could get a rate of return in five years on my investment that would cover my $991.00 house payment?

A: Shame on that financial planner for getting in the way of your financial dream of retiring debt-free!

There is no return a financial advisor can guarantee you that will equal the guaranteed return of paying off your mortgage. If you give the planner $1,200 per month, that’s just $14,400 per year, or $72,000 over the next five years.

If you gave the planner $72,000 today, the planner would have to earn a 14.4 percent return to double your investment in five years. And even if the planner managed to do that, you’d only have $144,000. To then pay you enough to make your $991 mortgage payment, your investment would have to earn about 12 percent per year, in order to cover the taxes you’ll pay on your earnings and the monthly payment.

Possible? Sure. Likely, I’d say not really.

Although your interest rate is low, and you might eventually be able to earn more on your investment than you’re paying for it, the goal of being debt free when you retire is more important. Once you are done paying for your home, you will no longer have to worry about whether you have enough cash coming in to pay the bills once you give up your job.

And that will give you a real sense of freedom.

Oct. 5, 2003.