Re: Reason for holding a mortgage...or not
That risk adjustment is a piece I think a lot of people miss. And it can go either way...you can move to an 80/20 and take the risk because you arent tapping the portfolio as hard...or you could go to a 35/65 or 25/75 and be really conservative, and trade high terminal portfolio size for low current volatility...because you dont need to tap the portfolio as hard.
In fact, according to firecalc, a retiree with no mortgage and a 75/25 portfolio mix can retire earlier and with less money than someone with a mortgage and accordingly larger portfolio with a 50/50 portfolio.
The decision fits nicely in a fishbowl, but you're really shortchanging yourself if you dont take all the implications into account.
Be fearful when others are greedy, and greedy when others are fearful. Just another form of "buy low, sell high" for those who have trouble with things. This rule is not universal. Do not buy a 1973 Pinto because everyone else is afraid of it.