🏡 How One Extra Mortgage Payment a Year Can Save You Thousands

When it comes to paying off your mortgage, you don’t need to overhaul your entire financial life to make a big impact. In fact, one of the simplest strategies — making just one extra mortgage payment per year — could save you tens of thousands in interest and shave years off your loan.

Let’s break it down.

💡 Why It Works

Mortgage interest is amortized, which means most of your early payments go toward interest, not principal. By making an extra payment that goes directly to your principal, you:

• Reduce the amount of interest charged in the future

• Pay off your loan faster

• Build equity more quickly

📊 Real Example

Let’s say you have:

• A $400,000 loan

• 30-year fixed rate at 6.5%

• Monthly payment of around $2,528 (excluding taxes and insurance)

If you make just one extra payment of $2,528 per year, you could:

• Pay off your loan roughly 4.5 years early

• Save over $80,000 in interest

And it gets even better if you start doing this early in the life of the loan.

💰 Simple Ways to Do It

Not sure where to find the money for that extra payment? Here are a few options:

• Use part of your tax refund

• Set aside $210 a month — that’s the extra payment broken into smaller pieces

• Apply work bonuses or side hustle income

• Make biweekly payments (you'll make 13 payments a year that way automatically)

⚠️ Pro Tips

1. Tell your lender the extra payment is for principal only — not toward your next monthly payment.

2. Confirm how your lender applies partial payments if you’re splitting them up.

3. Start early — the sooner you begin, the more you’ll save.

🚀 Bottom Line

One extra payment per year might not sound like much, but it adds up. Over time, it's a simple, effective strategy to save money, reduce interest, and gain financial freedom faster — without feeling like you’re sacrificing.

Want help running the numbers on your mortgage? Let’s connect — I’m happy to help you build a payoff plan that works for your budget and timeline.