Originally Posted by daylatedollarshort
+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.