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Old 12-28-2015, 09:04 PM
 
Location: Austin
29,546 posts, read 16,475,253 times
Reputation: 8087

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Quote:
Originally Posted by Serious Conversation View Post
Did you pay off a mortgage early and find it helpful or that the money was better allocated elsewhere? Even if it was better allocated elsewhere, did you find the peace of mind of being debt free worth it?
I have a mortgage and enough money to pay it off. But the interest rate is 2.5%. Why would I take money out of the market to pay off a 2.5% loan? So no, it's not an issue.
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Old 12-28-2015, 09:08 PM
 
Location: Austin
29,546 posts, read 16,475,253 times
Reputation: 8087
Quote:
Originally Posted by GotHereQuickAsICould View Post
Of course, having a paid-for home is a terrific advantage not only for retirement but for life in general..
I'm not sure why. I have a 2.5% mortgage. Why should I pay it off rather than keep that money invested?
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Old 12-28-2015, 09:53 PM
 
Location: Tennessee
23,541 posts, read 17,535,380 times
Reputation: 27576
Quote:
Originally Posted by GotHereQuickAsICould View Post
Of course, having a paid-for home is a terrific advantage not only for retirement but for life in general.

I would advise against a condo. Too many variables you don't have control over including maintenance. Nothing like facing your reclining years in a shabby condo.

I would encourage you to purchase an affordable home with 20% down, and length of mortgage with a good rate and affordable payments.

Get a decent size home. You may not foresee any kids in your future, but who knows. Also, if you need to relocate, smaller homes can be more difficult to sell.

Your best bet for retirement is regular contributions to your retirement fund. Read up on compound interest.

Good luck.
This is what I also think to a degree. I like the lack of maintenance, but all I've mowed are hilly yards in Tennessee where I needed cleats for most of the yards and had to shift my rear end on the rider to keep it from toppling.

One of my grandparents had a flat yard and I could mow it in under an hour with the push mower. I think the lot is about a quarter acre. There was enough room for a decent sized garden in the back.

I'd want no more than half an acre on flat land. Here in Indiana, flat is a given, it's just the winter that kills me.
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Old 12-29-2015, 04:52 PM
 
Location: P.C.F
1,973 posts, read 1,641,100 times
Reputation: 1607
Shabby Condos are few and far between or you're living in the wrong place in the country..
We too as stated invested money that could have paid off the house.. Like many others here , we are borrowing for under 3% collecting close to 7% in very low to almost no risk investments .. We live in SWF.. Never snows never really gets cold.. when its too warm we run the A/C or swim in our pool our go out in the 7mile x 25 mile harbor .. Yard is small 80' x 120' much of that is filled by what works out to be a 2700 Under roof or 1800 under A/C subtract lots of landscaped areas and the yard / Grass is very minimal. 7PM 12/29/15 77 degrees
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Old 01-04-2016, 10:20 AM
 
21 posts, read 14,588 times
Reputation: 92
Quote:
Originally Posted by Serious Conversation View Post

Did you pay off a mortgage early and find it helpful ? Even if it was better allocated elsewhere, did you find the peace of mind of being debt free worth it?
Yes to both of these things. I paid off my mortgage some years ago, and the money I used to pay to the mortgage went to being invested instead.

I just retired yesterday and I could not have done so if I still have a mortgage payment.

Nothing better than not owing money to anyone!
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Old 01-17-2016, 08:32 PM
 
Location: New York Area
15,853 posts, read 6,242,907 times
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Quote:
Originally Posted by Chavak View Post
Yes to both of these things. I paid off my mortgage some years ago, and the money I used to pay to the mortgage went to being invested instead.

I just retired yesterday and I could not have done so if I still have a mortgage payment.

Nothing better than not owing money to anyone!
As I write I am toying with the idea of paying off our mortgage. I can afford it but a financial advisor advised that I'd hurt my credit by doing so. My banker advised that if I kept "trade credit" or regular credit cards open and paid regularly my credit would not be injured. Any thoughts?
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Old 01-19-2016, 06:04 AM
 
Location: Central Massachusetts
4,800 posts, read 4,843,254 times
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Quote:
Originally Posted by jbgusa View Post
As I write I am toying with the idea of paying off our mortgage. I can afford it but a financial advisor advised that I'd hurt my credit by doing so. My banker advised that if I kept "trade credit" or regular credit cards open and paid regularly my credit would not be injured. Any thoughts?

Your financial advisor is wrong and the banker is right on the credit score. Two schools of thoughts on the mortgage and both are right in their way. If you have a high income and low savings mortgage is the way to go. If you have a lower income and higher savings than no mortgage is the way.

I am not talking about today's income I mean your retirement income. If you are going to have a pension or two and SS and your spouce has SS as well. And if that income is near to what you have now a mortgage can offset some of your income.

Even still I agree in either case I would prefer to not have a mortgage. I dislike paying people for the use of their money. Hence we have no car payments and pay off credit cards when due and not just paying the minimum.
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Old 09-19-2018, 11:25 PM
 
95 posts, read 26,431 times
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I am all for paying off the mortgage asap. The question is what do you do next. You could splurge the excess, buy a more prestigious home and or move to a better area. We decided that our home was great for children and families but was too hilly to retire in. We also hated gardening so our ideal was to retire to a beach area. We found a beautiful apartment on the beach and leased it for 15 years. The rent covered most of the mortgage. It's Price has escalated so much that we could not afford it at today's prices. We sold our old house and the proceeds covered the mortgage and some renovations. What I am really saying is that having a long term plan can really pay off.
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Old 09-20-2018, 01:10 AM
 
71,468 posts, read 71,652,652 times
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we had the reverse happen , we had a paid off home but having so much tied up in a slower growing asset sitting there prevented us from really taking part in lucrative deals .

so we sold it , have been renting and tripled the money in 15 years . we have the option of buying multiple homes today if we wanted to even after subtracting rent and taxes out .
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Old 09-20-2018, 05:07 AM
 
Location: RVA
2,164 posts, read 1,264,598 times
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I’ve never not had a mortgage. This is my 6th mortgaged home. When I bought the first 3 homes, there was no extra money to pay them off, and the market was hot. Appreciation was the investment. I never thought any home would be a “final” one, until the last one. I always expected to make money on every home, and have done reasonably well.

The fourth home I rounded up the mortgage payments to the next hundred or hundreds after that as it was before the ‘08 crash and refied maybe twice in 5 years. Until then refinancing was not the easy & common procedure is today. Sold that house months before the crash, double what I paid, and bought the fifth in a location less affected.

Lived in the fifth the longest to date, over 11 years and refinanced it many times from a 30, to a 20 to a final 15 at 3%. The idea was and is, always to minimize the interest rate, and keep the mortgage as long as investments are beating it. I always bought more house than I had to, but always could afford a large enough down payment to easily avoid PMI. All except this last one, were to some extent, fixer uppers or worth enhancing in their location. There was risk involved.

A LOT of my appreciation was sweat equity renovations. That has been a very successful strategy for me. But I have made 3 times more investing, than the appreciation of that fifth house, during the same time period, which to pay it off, would have taken all extra cash after taking the company match in savings.

There is no doubt at all in my case that paying off the house instead of investing was a poorer end game, BY FAR. And that is with full acknowledgement that luck of timing was a key player in maximizing profit in the last 2 sales. The 6th, brand new, and hopefully final one actually has the largest mortgage and square footage of all ( but about the same as # 4) and is 30 year.

I don’t ever see paying it off. I doubt rates will be much better than today for a long time. Inflation will likely only go up, so future me will see the mortgage as much smaller than it appears today. Affording the mortgage in retirement will be easy now, and if I actually wanted to, thanks to investing, I could easily pay it off, and still have high 6 figures left. I just don’t see the point. Even with a mortgage, my down payment (30%) & future equity in the new house is large enough that it could easily be a tappable income source.

Last edited by Perryinva; 09-20-2018 at 05:30 AM..
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