Q. I have a 20-year, fixed-rate mortgage at 5.8% with a balance of about $130,000 payable over the next 17 years. I'm considering using money I have in my 401(k) to make accelerated payments to pay down the principal. Should I do this? And what are the advantages of large, lump payments versus smaller ones? Is there a break-even point that would offer an economic or tax advantage, or both? I'm not planning to retire for another eight years.

A. We like the idea of paying down your mortgage. It reduces what you pay in interest and your mortgage will be paid off faster. But we almost never advise homeowners to use their 401(k) savings to make such payments, especially so close to retirement.

Those funds should be left to make money so that you'll have that 80% or so of your income you'll need when you do retire. And if you are not 59 1/2, you should definitely not use this money, because of the penalties you'll be charged for making early withdrawals.

There is a simple formula for deciding whether you'd be better off keeping the money in your retirement accounts or paying extra on your mortgage.

Just multiply your mortgage rate by 1 minus your tax rate. If, for example, your mortgage rate is 5.8% and your tax rate is 25%, the math is 5.8 times the difference of 1 minus 0.25 (or 5.8 times 0.75). The result is 4.35%. Compare that return to what you're earning on your retirement funds and choose the higher one. You have such a great mortgage rate, we suspect you'll be better off keeping that money in your retirement accounts.

If you decide to pay down your loan, our mortgage calculator can help. Plug in your numbers and then go to the "extra payment" boxes at the bottom. When you fill those in, hit "show amortization table" and scroll down to see how various extra payments will affect the interest you pay.

Making a large, lump-sum payment will lower the balance, and therefore the interest charged on your loan, right away. But in your situation, there's little difference between paying an extra $100 a month or making an annual lump-sum payment of $1,200. Your low interest rate, 17-year term and small principal eliminate big gain possibilities. The calculator also can show you exactly how much you'd save making various lump-sum payments.