This is the part that had me scratching my head a little. My wife and I have most of our spare money in 401Ks and Stocks. We have a few small short-term CDs.
Interests rates on mortgages are amazingly low, why are Americans paying down their mortgages, when the mortgage is one of our best tax breaks?
I feel like I might be missing something.
Jim 
We don’t have a mortgage anymore because we don’t get the tax deduction - we are part of the AMT/capped deduction crowd. So no reason to keep it. For me, it was a cash flow issue - I’d rather have $1500 to invest/spend each month than put $1500 on the mortgage…so got rid if it. Its one less obligation each month. Yeah, I MIGHT have made more in the market, but I might not have (short term), I had an adjustable rate mortgage at 6 1/8 - not low enough to compete with other no risk investments.
Debt free, own my home, car 2 years old and paid for, money in the bank and I’m retired.
All I need is a good woman to help me spend my dosh or I may have to leave it to the Ferret Herders and Goat Felchers Society of Great Britain plc
What is an AMT/capped deduction? I never heard of this before.
In our case, I got our 30 year all the way down to 5.25%, so even the CDs are paying almost as well. The 401k and stocks are all running between 10-20%. I did not panic with 9/11 and kept putting money into stocks in the 401k while the value was temporarily lower. So even in a down time, I made out better than 5.25%. We only keep the CDs for the flexibility of emergencies. We have one large chunk of stock set aside to help pay college and we have the dividends automatically reinvested. I suspect this will not be enough by itself, but it will pay for at least one child and then we can hope for some scholarships between the two. I guess one wedding will be another large expense I am forgetting about.
So far we always buy our inexpensive cars in cash and run them into the ground. I think this is the largest savings we have over other couples with similar incomes and number of kids. I pull into school functions in my little Focus wagon and park amid all the large luxury SUVs. 
My wife has a minivan we got all the way down to $20k. Her commute is negligible so it might last forever.
Least Original User Name Ever: Good luck, I will give you a piece of advice that work for me years ago. I spent two weeks doing a study using want ads from 6 papers and library resources for local certificate schools.
I decided to stop going for engineering at the time and jump into programming. I found that C++ and Visual Basic and other trendy languages all required 4 year degrees in Computer Science, but RPG/Cobol employers were looking for a pulse. Having found the in demand / low requirement entry field, I then found 3 schools that taught either RPG or COBOL. I checked their placements records and how many government agencies they were accredited with. I then had one two left. One required a degree or 4 years business experience to guarantee placement and only taught COBOL, the other taught RPG & COBOL and had lower requirements. I chose that one and 7 months later, I went from being an HVAC mechanic working on roof mounted exhaust fans on roofs to a Junior Programmer/Analyst.
Now, I strongly do not recommend computers at this point, but medical is the fastest growing fields in the USA. You might want to do the research and find a quick entry into the medical field. Without a lot of knowledge, I am guessing that Labtechs, LPNs, X-Ray Techs and Dental Assistants are among the entry levels that would let you build to a good career. Do the research, make the research your next internship and find out what the opportunities are. Look into programs to help pay for the additional training.
Good luck,
Jim
Haven’t had debt in years. (My credit card limit is USD22,500. That is insane.)
About a third of a million in the bank. Fifteen years to retirement. Oddly, I own no real estate anywhere at all. Given the worldwide situation, I doubt I will bother.
AMT is alternative minimum tax. If you get options (both Brainiac4 and I have options - he gets far more than I do) you often hit AMT. You can hit AMT for other reasons, too - it basically is supposed to make sure that the rich aren’t taxed merely at the 15% capital gains rate - although nowadays its hitting the middle class more and more.
Capped deductions hit us though even without AMT - once you get to a certain point in income, your deductions are proportionally reduced. We hit the cap on our deductions with state income tax - so the mortgage does us no good for tax purposes.
Computer science isn’t exactly my cup of tea. When I was leaving school, I was thinking that I’d want to know some kinds of computer language. Last day of classes, someone was getting rid of a bunch of computer textbooks, so I snatched them up. I was reading through the HTML book (sitting by the toilet, don’tchaknow) but was absorbing virtually none of it. I got about halfway through the book before I realized that it was futile.
I thought about employment a few years ago. Two professions came into mind: mortician (medical) and politician. I’m 25 now and feel that I’d almost be wasting my time going back to school. If I went for law or medicine, it’d be at least 4 or 6 years before I saw ANY return on investment. I’m already poor enough and I’d have to be VERY sure of what I’d want to do if I were to sink my life until I’m 30 and gobs of cash into it. The other route is “politician”. I like solving problems and I like working with others to form compromises. I just got out of the the internship for tax support. I’m not trained in computers or taxes, but I excelled at the job because I liked solving problems.
If I knew that, with a 4 year English degree, I’d be essentially useless to an employer, I’d have worked towards a different major.
I’ll stop hijacking the thread now.
I’m sure some accountants will concur with me, but you’re spot on. I saw some people get hit with AMT even at 55-60,000 dollars worth of income. In the next few hears, this will be a very popular fiscal problem with the people.
I think I should focus on moving out of the house first before buying one. Although, that would be an interesting way of getting my independence, buying my parent’s house. That’s a fun mental image 