[ChunkyMunky]

...IRA? I am a year into my 30 year fixed 4.5% 160k mortgage and I am currently making about 225 dollars a month extra payment towards principal. I owe about 153k right now. I know it's good to build equity and also own 20% to get rid of my 90 dollar monthly payment for pmi. My question is, should I start an IRA instead? I have a regular 401k(pretax) and would like to start a Roth IRA . I could bump the payment up to the amount allowed per year for the IRA if necessary. No goal in mind right now, I just want to make sure I'm taken care of in the future. I hear about compound interest and it's importance and how you have to save much more if you start later to meet your goal. The markets are crazy right now and investing might not be a great idea. I am 30 years old and single but looking for that other person. Thanks to everyone for their help.Thanks for the quick responses, I know I can always count on the help here. For my 401k I am at 8% contribution to get the 4% max contribution by my job, 50 cents to the dollar.Thanks again, I currently have the 6+ month just in case money. I also have 4k in school loans as my only other debt. Only other thing I can think of is that I need a roof for my house in the next year or so, about 8k.

[Jim McCoy]

I think, pay as much into the 401K as you can and pay the mortgage down. If you still want to do the IRA, just because you open the account, does not mean that you have to make deposits each month/year.

[Mind Over Reality]

1. Does your company have a matching contribution to your 401K ? If so, set your contribution to that match ceiling.2. PMI is a complete throwaway of money, pay down your mortgage to break the PMI threshold, then increase your investment amount by 1/2 of the amount you are no longer paying in PMI.

[fatcat]

It's a hard question to answer. There are other options to considero you have 6 months worth of expenses put away? If not, I would begin there. Don't expose it to too much risk, ladder it in cd's so that it would be available to you in the event that you need it. Once that is funded then save for your next car so that you don't have interest payments sucking up your money. Once that is funded then split your extra cash 3 ways. 1/3 principle paydown on your home, 1/3 IRA and 1/3 into other investments to be determined later ... it could be dividend paying stocks, preferred stock, hard assets like silver or gold.

[fredrulz]

Personally I would pay everything off first. If you have no debt at all and all you have is your mortgage congrads! If you are at that point then you should focus on both. Building an ira while paying your mortgage down asap. Then when everything is paid for you can focus on investing full time.