ST. CROIX INSIGHTS

Don’t Retire with a Mortgage.

BY BRETT ANDERSON/ST.CROIX ADVISORS, LLC

retire with a mortgage

This lesson is a short one, but that’s because it’s simple: don’t retire with a mortgage.

Other financial advisors might disagree with me on this. They might tell you about the great interest rates, they might highlight the tax deduction benefits, yada, yada . . . but they’d be wrong.

As far as I’m concerned, the question of whether or not to retire until your home is paid off boils down to one simple fact: debt sucks! Why deal with the burden of a major monthly payment when you’re on a limited income?

Don’t retire with a mortgage!

I don’t care about the interest rate, the tax deduction, or any of the other “benefits” you’ll hear about; it’s just noise. Take my advice and don’t retire with a mortgage—period. Your future self will thank me for it.

Investopedia has some sound information on the matter as well: Part of the rosy picture associated with retirement is the thrill of kissing that monthly mortgage payment good-bye—on the presumption you’ll have paid it off by then. Lately, there has been a shift in thinking that has seen many financial planners suggest that retirees continue to carry a mortgage into and throughout retirement. Reinvest the money from your home equity, and suddenly you’ll have a stream of new income, making your golden years a little more golden.

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Ask yourself- can my portfolio support my lifestyle in my retirement? 

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