Give both paths the same resources
Start with your mortgage balance today, its current rate, and the remaining amortization. Add the extra money available each month and, optionally, a lump sum available today.
Prepay, then invest uses the lump sum to reduce principal immediately and puts the monthly budget toward the mortgage until it is paid off. Any cash left in the final payment month is invested, followed by the whole monthly budget in later months.
Invest from the start invests the lump sum today, makes the regular mortgage payment, and invests the extra monthly cash. Both paths run until the end of the original remaining amortization. At that point, both mortgages are paid off, so the difference in investment balances shows which path finishes ahead under your assumptions.
The chart combines principal repaid with investments. It excludes the property’s value and appreciation, which are the same in both paths. The annual table separates investments from outstanding debt. All amounts are nominal future dollars; they are not adjusted for inflation.
Rates, renewal, and payment timing
The Canada option models a fixed mortgage rate compounded semiannually; the US option uses a nominal annual rate divided into monthly periods. Actual loan conventions can differ. Investment returns are effective annual returns converted to monthly growth, with contributions at month end.
At the first rate change, the calculator recalculates the regular payment using the baseline balance and remaining amortization. Both paths then use that regular payment plus your extra cash as their monthly budget. The prepayment path keeps this budget even if a lender might allow a lower payment after renewal. The new rate stays constant thereafter. For a mortgage fixed to its payoff date, set the first rate change equal to the remaining amortization.
Check the assumptions that change the decision
The return sensitivity table compares your assumption with returns two percentage points above and below it, within the supported range. It illustrates a range of outcomes; it does not model market volatility or the probability of achieving them. Try a lower return and a higher renewal rate as separate checks.
Enter investment returns after taxes and fees. Account-specific deductions, matching contributions, withdrawal taxes, and mortgage-interest deductions are excluded. The results also exclude lender fees and prepayment charges. The Financial Consumer Agency of Canada explains prepayment privileges and penalties; the US Consumer Financial Protection Bureau recommends checking your loan’s prepayment terms.
A higher projected balance is one consideration. Keeping accessible savings, handling unexpected costs, and being comfortable with investment risk also matter. This is an educational comparison, not a mortgage quote or investment forecast.
Keep the comparison with your plan
Save a shareable link or keep this comparison locally beside your cinder.fi plan. Your complete inputs travel with it, so you can reopen and adjust the assumptions. It does not modify an existing loan or create a retirement scenario. For household tax and retirement effects, use your actual accounts in the full plan.