Q: My wife and I save quite a bit. We both contribute the maximum allowable on our 401(k) accounts, contribute to Roth IRA’s, purchase stocks through dividend reinvestment and optional cash payments, and have paid off all of our debt except the mortgage. We also have some emergency savings in a money market account. We hope to retire in about 6 years and want to reduce our risk a little and put some money into income-producing investments.

Should we pay off our 6.5 percent mortgage or invest our extra money with a financial planner? We’ve been prepaying our mortgage, and have already reduced the term from 30 years to about 17. Our financial planner has helped us earn about 8.15 percent before taxes.

A: Congratulations on your excellent savings and investing strategy. It sounds like you’ll have a very secure financial future.

Generally, you’ll do better over the long run (10 to 30 years) by investing your cash outside of your mortgage. Since you’re already prepaying your home loan, I suggest you either keep your remaining tax breaks and invest the cash in the stock market, or put a little more toward prepaying your home.

It would be nice to be mortgage-free when you retire. Consider stepping up your prepayments so your mortgage is all paid off in 6 to 7 years. Once that’s done, your available cash should be put back into long-term investments, either a rental property (which will generate cash flow) or the stock market.

If you decide to invest in the stock market, you’ll have to do research to determine which type of investment (stocks or bonds) will fit in with your portfolio. Index funds are designed to meet the market return at a very low cost. For other mutual fund information, check out www.morningstar.com.

Feb. 28, 2001.