I Earn $130,000 but Am Terrified of Layoffs. Should I Stop Funding My 401(k) to Pay off My Mortgage?

Timothy McGrath Featured in Money.com: Should You Pause Retirement Savings to Pay Off Your Mortgage?

Riverpoint Wealth Management's Timothy McGrath, CFP®, was recently quoted in Money.com, weighing in on a question many workers are asking amid layoff fears: should you cut back on 401(k) contributions to pay down your mortgage faster?

The article centers on a Reddit post from a 28-year-old earning $130,000 who worried that AI and offshoring could put his job at risk, and wondered whether he should divert retirement savings toward paying off his $342,000 mortgage.

Tim's advice: focus on liquidity, not payoff. Extra mortgage payments reduce your principal and loan term — but they don't lower your required monthly payment, so they don't actually provide a safety net if you lose your job. Instead, Tim recommended building a larger emergency fund, since this reader's specific risk of unemployment (a highly specialized role that could face steep pay cuts elsewhere) warranted saving more than the standard three to six months of expenses. He suggested aiming for closer to nine months to a year of living expenses in liquid savings, while continuing to invest for retirement and keeping fixed costs lean.

Read the full article on Money.com.