I went through something similar a while back, and yeah, I definitely factored in PMI. Ran spreadsheets comparing scenarios:
- Paying extra to ditch PMI early vs. investing the difference.
- Factored in average market returns (~7% historically).
- Included tax considerations and inflation.
Surprisingly, investing came out ahead by a decent margin. But honestly, seeing that PMI charge every month bugged me so much that I still couldn't resist paying it down a bit faster... logic doesn't always win out over psychology, I guess.
I felt the same way about PMI—it drove me nuts seeing it every month. Ran similar numbers myself, and yeah, logically I knew investing made sense. But when I finally hit that 20% equity mark and saw PMI vanish from my statement, the mental relief alone was worth it. Sometimes peace of mind beats a spreadsheet, you know? Plus, freeing up that cash flow each month felt pretty sweet...
"Sometimes peace of mind beats a spreadsheet, you know?"
Totally get this. When we bought our first place, PMI was just another line item I shrugged off at first—until I started noticing it month after month. Eventually, it became this nagging reminder that we weren't quite there yet. I remember the day we finally hit that magic 20% equity mark; it felt like a mini celebration. Sure, logically investing those extra payments might've netted us more in the long run, but there's something about seeing your monthly bill shrink that's hard to quantify on paper.
One thing I'd add—once PMI dropped off, we redirected that money straight into savings for home maintenance and upgrades. It wasn't glamorous, but having a cushion for unexpected repairs (like when our water heater decided to quit mid-winter...) was priceless. Sometimes practicality and peace of mind go hand-in-hand.
"Sometimes practicality and peace of mind go hand-in-hand."
Couldn't agree more. When we finally got rid of PMI, it felt like a weight lifted off our shoulders. Sure, I could've crunched numbers all day to justify keeping it longer and investing elsewhere, but honestly, seeing that monthly payment drop was such a relief. Plus, having extra cash freed up for those surprise home expenses—like when our AC decided summer was the perfect time to quit—was totally worth it.
Totally get the relief of ditching PMI, but sometimes refinancing just to drop it isn't always the best move. When we refinanced, closing costs and fees ate into our savings quite a bit. Sure, monthly payments dropped, but it took us almost two years to break even on those upfront costs. If someone's planning to move or refinance again soon, crunching numbers might actually be worth the headache...just saying.
