The recent recession has taught most Americans one thing: there is no such thing as a sure thing when it comes to financial security.

This has also opened up a new awareness of credit and debt. To avoid falling behind in the case of a job loss, it pays to not have any major payments to make every month. The less you have to pay to others, the more of a cushion you have in case things go wrong. But should that mean rushing to pay off your home?

Probably not.

It’s really a numbers game. If you have an extra $200 dollars a month to put towards debt, you should be concentrating on the debt with the highest interest rate. If you have a credit card charging you 15%, and a mortgage charging you 8%, pay off the credit card first. Work your way down to the lower interest rates when trying to pay off debt.

Don’t assume that you should tackle the big ticket purchases (your home) first. Once the items with the highest interest rates are taken care of, go for the smallest balances. These bills are usually the quickest to pay off, and getting them taken care of can provide a sense of accomplishment. They can also keep you motivated on paying off futher debts.

After that has been taken care of, start putting together a savings account, if you don’t already have one. Having a cushion to cover you in case of a sudden reduction in income, due to illness or job loss, will do more good than being ahead on your mortgage. Ideally, you want to aim for 3 months worth of expenses, at the very least.

Instead of paying off your mortgage at this time, start putting money into investments. Stocks and bonds give you more for your money than paying off your mortgage would.  If you can put $200 a month into an investment opportunity that gives out 8% interest, your money is working harder for you than if you were to pay off a mortgage with 7% interest. You should also be putting money into an IRA for retirement.

That being said, there is a pleasantly secure feeling knowing that you own your home outright, and even if a financial crisis happens down the road, there is no way to lose your home. If your going to pay off your loan, remember to check first for prepayment penalties, which can equal around $6,000 depending on your loan.