This is a question that everyone finds themselves asking eventually. While most people will advise against retiring with a mortgage, there is a lot to consider on an individual level. You should do what is right for your financial situation.
Reasons to Pay off Your Home
Your mortgage is a major financial responsibility. Paying it off as soon as possible is very beneficial. First of all, the sooner you pay it off the less you’ll have to pay in interest. This in and of itself will save you money. Paying off your house also frees up your finances. You can begin working toward other financial goals like saving up for retirement. Not to mention, if your house is already paid off, you’ll get to use your retirement money on yourself. It can ease your mind and allow you to enjoy retirement. Plus, paying off your house gets you even closer to being debt free which will also ease your burden in retirement.
Source: https://www.fool.com/millionacres/real-estate-financing/mortgages/4-reasons-pay-your-mortgage-early/
Making a Mortgage Work in Retirement
In some cases, you may need to carry your mortgage with you into retirement. Fortunately, there are ways to make this work. One option is to pay off large chunks of your principal. This helps to lessen the amount of interest you’ll need to eventually pay, and it can shorten the amount of time you’ll need to pay off your mortgage. Another option is to refinance your home. When you refinance you have the chance to renegotiate your mortgage. This includes the rate as well as the duration. Before you refinance, you should find a good mortgage lender to help you out. Reviews can help you decide on the best mortgage lender for a refinance.
Source: https://www.podium.com/article/mortgage-broker-reviews/
Review Your Situation
Not everyone is in the same situation. For most, it’s recommended to pay off your mortgage before retiring, but this isn’t a reality for everyone. For some people, paying it off beforehand can actually be more financially straining and prevent you from saving any money for retirement. Many people are also buying houses later in life, so it is becoming more typical for people to still be working on a mortgage after retirement. While there is plenty of advice out there about what’s normal, you should take time to evaluate your own situation and see what is right for you.
Source: https://blog.massmutual.com/post/retire-mortgage
A mortgage is a large financial burden and when to pay it off can be a major question. There are benefits to doing it before retirement, but it really depends on your situation. Review your finances and make a plan that best suits your needs.
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