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Old 11-05-2011, 02:19 PM   #21
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Spencer, everybody has to have their own comfort zone and obviously having a mortgage in retirement is not for everybody. Good Luck to you.
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Old 11-05-2011, 03:16 PM   #22
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Ripper and ERD50,

My comment was not to criticize someones personal decision, do not misunderstand. If it is by design as part of a careful strategy that is OK.
That really does not reconcile with what you actually said (bold mine):

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Anyone who _plans_ to have a mortgage hanging around while retired is a bit foolish, in my opinion...


M
What is to misunderstand? You said that you think a number of us are a bit foolish for having a mortgage in retirement. How is that not criticizing someones personal decision?

-ERD50
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Old 11-05-2011, 04:17 PM   #23
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That really does not reconcile with what you actually said (bold mine):

What is to misunderstand? You said that you think a number of us are a bit foolish for having a mortgage in retirement. How is that not criticizing someones personal decision?

-ERD50
I would love to have my mortgage paid off, but it didnt work out that way. The payment is only about 18% of my monthly net income. With no debt, I can handle the payment in retirement with no problem. But, if the criteria was "paid off mortgage" before I could retire, that would have delayed retirement another 10 years for know apparent reason other than to have it paid off. It will get paid off in time, but not a real concern.
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Old 11-05-2011, 04:57 PM   #24
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Congrats Dave. Reducing the housing expense is always a good thing.
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Old 11-05-2011, 05:10 PM   #25
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I view mortgage and college funding just expense lines. If one is retired, do they have the income to support the budgeted expense. Sure some prefer not to worry about that monthly bill, automated or not.

I'm not ER'd yet, but have my mortgage paid off. In the event it makes sense to refi and get a 1st mortgage or HELOC, it will be a consideration (meaning lowest cost of capital with everything considered).

As for college for my kids, I'll have a nice chunk (100% of projected tuition/housing) before ER, but will probably have an expense line for monthly contributions when I ER. I personally view that as an emergency cushion and flexible. I'm accounting for 500 a month in ER, but that's just me.

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True, college and retirement savings should be fully funded along the way. However, I question anyone who criticizes paying off your primary residence as part of that plan - sounds like an excuse for lack of financial discipline.

Anyone who _plans_ to have a mortgage hanging around while retired is a bit foolish, in my opinion...


M
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Old 11-05-2011, 06:45 PM   #26
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T

Anyone who _plans_ to have a mortgage hanging around while retired is a bit foolish, in my opinion...

M
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Old 11-05-2011, 08:53 PM   #27
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I'm embarrassed to say I had to google Heloc but I totally understand the feeling you get when you get rid of the house note. I wrote my last check to Chase Manhattan in 2001 and it still feels good.
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Old 11-05-2011, 09:40 PM   #28
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IMHO this discussion is really about what you do with investment returns, double down or used them to pay down debt. In the market run up from 2008 to 2011 I took my gains and decided to pay off debt....ie the mortgage. With interest rates so low there are good arguments for keeping a mortgage, but the recent volatility of the market makes me glad that I took profits when they were available and used them to become mortgage free.
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Old 11-05-2011, 10:00 PM   #29
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IMHO this discussion is really about what you do with investment returns, double down or used them to pay down debt.
Those may have been the two options you visioned, but there are many more considerations beyond either using investment returns to double down or to pay down debt.
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Old 11-05-2011, 10:23 PM   #30
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Those may have been the two options you visioned, but there are many more considerations beyond either using investment returns to double down or to pay down debt.
You could by a BMW I suppose
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Old 11-05-2011, 10:46 PM   #31
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Anyone who _plans_ to have a mortgage hanging around while retired is a bit foolish, in my opinion...
Call me a bit foolish. Seems like a good bet to me. I'll have a mortgage at a fixed, historically very low interest rate. It's cheap money, invested prudently. This is among the most conservative options available to allow a retiree to hedge (a little) against increases in inflation.
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Old 11-05-2011, 11:31 PM   #32
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Call me a bit foolish. Seems like a good bet to me. I'll have a mortgage at a fixed, historically very low interest rate. It's cheap money, invested prudently. This is among the most conservative options available to allow a retiree to hedge (a little) against increases in inflation.
+1.....Well said. To me the bank is in trouble. I have their money.
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Old 11-05-2011, 11:59 PM   #33
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I know I am going to get beat up for this one. Everybody's situation is different. I busted my butt to pay off our last house and never really had any extra money. Ended up taking out a HELOC to pay for kids education. So ended up paying interest on the money I used to pay off the house. In my new house I just put down 20% and kept the rest for investments and cash. I rather have access to my cash than be tied up in the walls of the house. Like I said everybody is different. My pension easily handles the mortgage. Your house is only a place to live and not an investment.
Hey, I'm on the "keep the mortgage" team too.
Covering a mortgage without losing your ass(ets).
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