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Old 10-13-2014, 03:40 PM   #21
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I cant imagine retiring myself without having retired my mortgage first. But then I cant imagine having a mortgage past age 45. The whole idea of long term 30 year mortgages and easy credit is just one way of throwing financial shackles on the populace if they are willing to drink the coolaide.


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Old 10-13-2014, 04:46 PM   #22
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I cant imagine retiring myself without having retired my mortgage first. But then I cant imagine having a mortgage past age 45. ...
Up to that point you were OK, IMO, because you just expressed how you feel about holding a mortgage. You're free do do as you see fit. But then...

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... The whole idea of long term 30 year mortgages and easy credit is just one way of throwing financial shackles on the populace if they are willing to drink the coolaide.
I'm not 'shackled' by my low interest loan. And I use that easy credit (assuming you meant credit cards here) every month as much as I can (and pay it off each month). That's EZ. If we 'fixed' this, responsible people who would prefer to hold a mortgage or use credit wisely would not be allowed to. I would not like that. That would be 'shackling' me to be the same as the lowest common denominator. Not the kind of world I want to live in, we already have too much of that.

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Old 10-13-2014, 08:19 PM   #23
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I cant imagine retiring myself without having retired my mortgage first. But then I cant imagine having a mortgage past age 45.
That's great if you are lucky (or unlucky) enough to stay in one location your entire working career. And also remain steadily employed. Many people, if they want to advance in their profession have to relocate, either voluntarily or by their employer. That makes the chances of having a paid off mortgage on any specific property really slim. It is better for many of us to consider a mortgage as a tax deductible form of rent and invest the money instead.
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Old 10-13-2014, 08:30 PM   #24
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Easily done in any of those situations really. You can easily advance any mortgage and wuicken the payoff as long as your not tempted to refinance a larger amount each time and reach beyond your means with each move.


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Old 10-14-2014, 07:39 AM   #25
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+1. I would think key metrics to look at for personal financial health in retirement would be common amounts and ratios like total net worth, monthly retirement income, income to debt etc.

Household A could have a $100K mortgage at 3%, offset by 100K in Treasury bonds at 4% and be worth $10M. Household B could have no mortgage and a total net worth of $100K. Which household is better prepared for retirement?
+1 here also - we plan to retire in 2 years, and just did a refi at 3.5% last year for 30 years.

First, as mentioned several times, this is an individual decision that needs some thought and planning depending on your own personal situation. I think it is crazy not to take 3.5% funds when I average more than that in low risk investments over the last 10 years, but that is my decision and I have to bear the risk. I could pay off the mortgage but most of my net worth is in IRA/401K accounts, so would have to pay taxes to use. I also have 2 army retirement checks (mine and DW) which more than pay the house note. So, I can afford the payments with low risk.

Second, I don't think it is very smart to generalize about an individual decision like this. If you don't have the smarts or desire to figure out for your self, then you may want to follow the general rule to pay off the house before you retire.

Third, seems that there may be a point to consider once we get past the discussion of is it ok to have a mortgage in retirement. There are many more people that are unprepared for retirement than in the past. There have been many reports about low levels of retirement accounts, people planning to work till they die, and other indicators that point to the fact that many are not prepared to fund their retirement. We as a people are not willing to let those that haven't saved eat cat food so we will be paying for the retirement they can't afford, at least some of it. That is a fact. We can discuss as a country how much we support them, if they should get free cell phones or not but we will be supporting them. I don't like it but to rail against facts is just crazy. Well it can be fun for a while, but it doesn't change facts.
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Old 10-14-2014, 08:25 AM   #26
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I was surprised when my over 70 neighbor told me they were refinancing their house, and I know they lease their luxury cars. Then it occurred to me that he was a VP and a lifer at a solid megacorp, and must have a great pension. I also know they've set up trusts for grand kids and it sounds like they will leave plenty behind. Unless pensions go away for people like this, I don't see a problem with a mortgage. Even without a pension it's still just a choice of whether you want to leverage your house to invest more. I prefer not to, but neither way is outright wrong.
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Old 10-14-2014, 08:34 AM   #27
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The payment on my mortgage is similar to a SFH rental payment in my part of the SF Bay Area. Unlike rent, the payment is fixed (and I am safe from eviction). Not all of us bought a house in our youth, to be able to pay off the mortgage before EARLY retirement. And some of us are at the "saving" side of the balance but far from the "scrimping" extreme that would have been required to pay off a ten-year mortgage.
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Old 10-14-2014, 08:58 AM   #28
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Some early retirees might want to take out a mortgage to increase after tax cash money pre65+ to qualify for ACA subsidies of $15K or whatever each year or maybe financial aid for college which could be worth up to $50K at an expensive school. Personally, we would always run the numbers with spreadsheets and do hours and hours of analysis to see which way we came out ahead. I have no emotional feelings towards a mortgage or not. We focus on maximizing our net worth, minimizing our taxes, maximizing tax credits and financial aid for the kids.

There are also asset protection laws to consider as well. In some states it might be more prudent to have a mortgage if there are no asset protection laws and in others personal residences are highly protected. There are many variables we would always consider and do a detailed spreadsheet analysis on before making any mortgage or not decision.
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