First off, we would like to buy a different, slightly larger house in the next year or two, so we are trying to save for that and make some upgrades to our current home. In the meantime, I'm wondering if we should be paying down any of our debt.
Including the company match, about 19% of both DH's and my salary goes into our respective 401(k)s. (I work PT, though, so it's not a huge amount in my case). So I think we are set there.
We owe just over 100K on our mortgage at 5.25%.
DH has one student loan with a balance of nearly 19K at 3.875%.
Would it be more important to pay down this debt - or are we OK with saving for a different house?
And if we were to pay down one or the other, which one should it be? Obviously we are paying more interest on the mortgage, but we're taking deductions on the interest paid for our tax returns.