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the problem was decades ago there really were no effective means for the public to save money.
we had no 401k's to force that money into savings for us each week.. yeah if we were disciplined we could sock away a bit in a ira but it was relatively small.
mom and pop were rarely invested in markets and very few families even had stock ownership.
basically you had no way of increasing income so your recourse was to cut expenses.
remember retirement is all about cash flow which is earning more or spending less .
buying a home before taxes and maintaince went out of sight was the traditional way of doing it.
well today with the ability to increase income through investing you can get to the point the income exceeds the rent increases and you are actually ahead of the game. you are increasing income with investments vs decreasing expenses with a house.
we just have more options today so i think the fact is less retirees own , want to own or have a paid off mortgage because the need is not as great or as important as it once was .
Well, to return finally to the subject matter of the original post (above), the traditional pattern of life was that people made mortgage payments during their working years and by the time they retired the mortgage was paid off. However, that pattern was interrupted or derailed for many because of the economic crash of 2007/2008 and resultant job losses. Other people derailed the pattern by themselves by using their homes as ATM's to fund lavish spending for big-ticket items and travel and then found themselves outside in the snow, so to speak.
Still other people have simply given no thought to retirement at all and have been life-long wasters of money. Those are basically the ones who are now stuck on Social Security alone, which is a tough row to hoe.
If we have enough cash flow it really doesn't matter if we own free and clear, own with a mortgage, or rent. The phrasing of the second sentence in the OP seems to assume that people "on Social Security" do not have other savings, investments, or assets; therefore they must be in trouble if they are paying rent or a mortgage. And of course some are in trouble. But many others - in fact the majority of current retirees - are doing just fine.
Bottom line: We as a nation have paid a heavy price for abandoning the traditional idea of living within our means. That's what this whole discussion comes down to. If we have lived within our means and planned for retirement (even if imperfectly) then we are O.K. (in the vast majority of cases) whether we rent or own with a mortgage or own outright.
Glad you put in the caveat of the economic crash and job loss. Everyone that is not in the best of financial shape today did not necessarily live beyond their means or say fiddle de dee to planning for the future. Job loss, health issues etc can devastate the most careful preparation. If crisis hits at a time that other factors are at their worst, an erosion of assets is a pretty rapid result. I always figure that the ability to survive some worse case scenarios is a testament to tenacity as well as evidence of some pretty substantial earlier preparation .
One size does not fit all when it comes to an individuals retirement and financial situation. I will have a mortgage once I retire in the pricey bay area. When you take into account, historical low mortgage rates, tax write offs, its a much better alternative than renting here and a helluva better quality place to enjoy. I am single and my retirement income cash flow will be more than sufficient to cover all living expenses including the mortgage. Currently and have for a number of years I've been working on building my reserves through saving/investments for the most part by living frugally although I do indulge at times. I will be the first to admit, that this may not have been possible and or certainly more complex if it werent for the fact that I'm single.
Though I've always left the door open for starting a family, for that to happen I would probably need to lose my mind and relocate to a lower cost of living area, which are many such locales compared to the pricey bay area, or finding a rich babe.
we still will have mortgage (not overwhelming), but refinanced last year so our monthly payment can be minimal if necessary. Will have 2 moderate pensions, both taking SS early
Well, to return finally to the subject matter of the original post (above), the traditional pattern of life was that people made mortgage payments during their working years and by the time they retired the mortgage was paid off. However, that pattern was interrupted or derailed for many because of the economic crash of 2007/2008 and resultant job losses. Other people derailed the pattern by themselves by using their homes as ATM's to fund lavish spending for big-ticket items and travel and then found themselves outside in the snow, so to speak.
Still other people have simply given no thought to retirement at all and have been life-long wasters of money. Those are basically the ones who are now stuck on Social Security alone, which is a tough row to hoe.
If we have enough cash flow it really doesn't matter if we own free and clear, own with a mortgage, or rent. The phrasing of the second sentence in the OP seems to assume that people "on Social Security" do not have other savings, investments, or assets; therefore they must be in trouble if they are paying rent or a mortgage. And of course some are in trouble. But many others - in fact the majority of current retirees - are doing just fine.
Bottom line: We as a nation have paid a heavy price for abandoning the traditional idea of living within our means. That's what this whole discussion comes down to. If we have lived within our means and planned for retirement (even if imperfectly) then we are O.K. (in the vast majority of cases) whether we rent or own with a mortgage or own outright.
I think your comment in the next to last paragraph is really the key, many folks I know who receive SS also have other income, some of it pretty substantial.
Unlike many of the posters who have commented on this thread, I see the issue as no different than when you work. If you have some debt, including mortgage debt, but can reasonably afford it based on your monthly income, I see no need to pay off the mortgage. Having a mortgage means using other money, and doing so can provide an "enhanced lifestyle" that you can still comfortably afford.
I have to say I think all this " living within our means" crap is just that, crap ! With a dwindling middle class, and the discrepancy between the rich and the poor gets wider everyday, especially when now many former "just holding on" lower middle class is now become lower class, most to remain there for the few years left in retirement. many are now working until 70 or 75 cutting even shorter that gap from cradle to grave.
Then we have had so so many loose there shirts these last 5 years in the markets, mostly behond their control, while the brokers and the investment banks get even richer by the day. I was one of those ( my fault however, I played commodities before they were cool ) many. That can sure take a bite out of your retirement savings plans. As a result, there are a lot of seniors that has second and even third mortgages on their once paid for home....So, Its no wonder so many are so cash poor, just at the time when they should not be, they should be able to make choices, maybe for the first time in their lives, sadly many now have no choice, whats left of the equity in their home has been spent long before the day they get that fake gold watch, they throw in a drawer, never to be seen again, yes, a lot of unhappy folks out there, more than we think I am afraid !
One size does not fit all when it comes to an individuals retirement and financial situation. I will have a mortgage once I retire in the pricey bay area. When you take into account, historical low mortgage rates, tax write offs, its a much better alternative than renting here and a helluva better quality place to enjoy. I am single and my retirement income cash flow will be more than sufficient to cover all living expenses including the mortgage. Currently and have for a number of years I've been working on building my reserves through saving/investments for the most part by living frugally although I do indulge at times. I will be the first to admit, that this may not have been possible and or certainly more complex if it werent for the fact that I'm single.
Though I've always left the door open for starting a family, for that to happen I would probably need to lose my mind and relocate to a lower cost of living area, which are many such locales compared to the pricey bay area, or finding a rich babe.
The question comes maybe sooner than you think, or maybe you will live behond your years, ether way the time DOES get shorter when you become a Senior. If you are like me, all the family has passed on, all thats left are those I seldom see if ever......So, whats left when you die, hopefully nothing, I earned it.!... I guess finding a rich babe at the end of the rainbow would change .now, Today and tomorrow, but in the end, no . I still wish the last dime to drop the day I tip over.
it goes both ways, i think if you remember the poll here the majority of folks said they are right on track .
Thats because the vast majority are here for a purpose, they do take life seriously , otherwise they would not be wasting their time following boring threads on City Data. The numbers are skewed i am afraid, the silent crowd are the ones we never hear from, more today, but still that sense of pride and resulting embarrassment keeps them in the shadows.
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