Should I payoff my mortgage?

Need more info. Age? Desired retirement age? Retirement assets? Kids? Kids ages? Etc.

Would likely be best to see a fee only financial adviser as well

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I know you can make more money off of investing it instead of paying off your low interest mortgage but there’s a certain priceless component of having a paid off house.

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That's where I'm at. If I was at an 8% rate, I would, but it currently is so low. I don't know if it would hurt me in the long-term with the IRS deduction by paying it off @ a sub-4% interest.

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My wife’s parent’s paid cash for their house back in the 1970s and never had a house note.

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but rates were also 8-10%

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Married; both in late 30s; 1 kid (8y/o); Sep account; 401k

Desired retirement age - tough to say, I don't really have many plans to retire till 70, I would like to "slow down" at 60. Wife would most like to retire now , but that won't happen. Let's say mid to late 50s for her

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first poster nailed it in his last sentence.
Invest some of that money by paying a professional a flat fee. That way you can lay out all your money/assets/long term goals for a more tailored advice.

You keep mentioning the deduction, but based on the information you've provided us, I don't really think you're getting the deduction you think you are. Maybe up until last year you did, but I'm thinking it's not very likely you're getting this anymore as your standard deduction is 24k. To take the mortgage interest deduction, quick math tells me you're maxing at $8,400 for that, you'd need a helluva lot of other deductions to make it better than your standard deduction... That said, it's possible.

Here's a calculator you can use Mortgage deduction calculator

And an article on the topic Itemizing after tax reform

But the easy way to check is to just look at your tax return for 2018 and see if you're itemizing or taking the standard deduction.

If this is a hold-up, it may be a non-issue.

eta. and if you are, you can do an apples to apples comparison at this point to see how much $$$ it is different

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Wife would most like to retire now , but that won't happen.

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So let's slow down a minute: is this your wife's inheritance, or did her parents leave it to the both of you? If so, you need to recognize that the $400K you are counting belongs to her, at least in Louisiana. Inheritance is separate property, even between married people. Your conversations with her about this money MUST acknowledge this, and you should be paying attention to what she wants to do with this cash.

Perhaps creating a large college fund for a kid is more important to her than not having a house note. Perhaps she would prefer to invest it all, and work fewer hours a week knowing that her investment portfolio is working on her behalf.

Repeat after me: it's not my money. it's not my money. (Apologies if you indeed were specifically named in the will and it is half yours.)

I saved more money in my 50’s than at any time in my life due to having paid off my mortgage early. Best move I ever made.

When you cut to the chase....

Can you get better than 3.5% from the market/other investments?

I surely think you can.

Stop overthinking this and pay off your mortgage. being debt free before 40s will lead to a stress free life that will create wealth. Just pay it off.