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My vote in the poll was "keep the same lifestyle" because that's what I have done. But actually things are better than that. Although my gross income is not any greater in retirement, my cash flow is greater because I paid off my mortgage about the same time I retired. Yes, there are still expenses as a homeowner (insurance, maintenance, etc.) but the mortgage is normally a more than negligilble amount and the mortgage would be on top of those other expenses anyway. Therefore, not having a mortgage is a total gain to cash flow in the medium term, even if it may not be a gain to net worth in the long term. (One could invest the amount of equity in the house and probably do better than the interest paid on the mortgage).
Personally, I prefer not having a mortgage. And before some of you jump down my throat, I admit that's an emotional decision as much as it is a rational and objective decision. But it's a decision I made with full knowledge of its nature and its probable consequences. For one thing, I have no heirs to whom I wish to leave any legacy. I have two nieces, but they are almost strangers to me.
My vote in the poll was "keep the same lifestyle" because that's what I have done. But actually things are better than that. Although my gross income is not any greater in retirement, my cash flow is greater because I paid off my mortgage about the same time I retired. Yes, there are still expenses as a homeowner (insurance, maintenance, etc.) but the mortgage is normally a more than negligilble amount and the mortgage would be on top of those other expenses anyway. Therefore, not having a mortgage is a total gain to cash flow in the medium term, even if it may not be a gain to net worth in the long term. (One could invest the amount of equity in the house and probably do better than the interest paid on the mortgage).
Personally, I prefer not having a mortgage. And before some of you jump down my throat, I admit that's an emotional decision as much as it is a rational and objective decision. But it's a decision I made with full knowledge of its nature and its probable consequences. For one thing, I have no heirs to whom I wish to leave any legacy. I have two nieces, but they are almost strangers to me.
We have a small mortgage around 90K from when we purchased this house in July 2106. Would really prefer to be mortgage free and could be but the comfort level dictated that we keep the liquid money available for emergency and for what this old 3 story house might need.
Such as a month ago $6500 a month for a new boiler.
Mortgage is for 20 years at an even 3% plus we are paying extra each month. Should be done in about 12 years.
As the Finns and the rest of the Scandis say here --- Life is good in da UP !
My vote in the poll was "keep the same lifestyle" because that's what I have done. But actually things are better than that. Although my gross income is not any greater in retirement, my cash flow is greater because I paid off my mortgage about the same time I retired. Yes, there are still expenses as a homeowner (insurance, maintenance, etc.) but the mortgage is normally a more than negligilble amount and the mortgage would be on top of those other expenses anyway. Therefore, not having a mortgage is a total gain to cash flow in the medium term, even if it may not be a gain to net worth in the long term. (One could invest the amount of equity in the house and probably do better than the interest paid on the mortgage).
Personally, I prefer not having a mortgage. And before some of you jump down my throat, I admit that's an emotional decision as much as it is a rational and objective decision. But it's a decision I made with full knowledge of its nature and its probable consequences. For one thing, I have no heirs to whom I wish to leave any legacy. I have two nieces, but they are almost strangers to me.
Don't know why there are so many that disagree with your statement, but there are- which shows how different we all are. I agree with you. DW and I are taking the proceeds of the current house sale to build another house in a lower cost area to be free and clear. Yes, that would have been a good chunk of cash to invest, but at this age, I don't like the stress of market fluctuations. Like you, our retirement GROSS income will be much MUCH smaller than what I now make, but after considering the lack of a mortgage payment, our net income will be about the same. That is GOOD ENOUGH for us. The one thing I am hoping for that we will learn to sleep at night instead of the 5:00 am wakeup, 6:00am drive-through-snowstorms to work ritual that I currently have. I have NEVER been a morning person, and this routine is driving me absolutely crazy.
Edit:
JIMANDTHOM - congrats on the move. The UP is just amazing. It's Good to have a new boiler! We just had to dump a ton of money into a new heating system also, but you'll love the investment when the white stuff flies!
Last edited by MichiganGreg; 04-25-2017 at 05:39 AM..
Reason: forgot to say sumpin.
I think I voted for the wrong answer. My correct answer would have been the last one ...varied with circumstances. But that's because we started retirement at answer #4 "reduced spending, a little worried" our first year. The second year and during our big move we were more like answer #3, "same lifestyle". After settling into our house and getting things done we sort of arrived at #2 "relaxed". Finally we have done all the necessities and we are starting in on the "wants", like remodeling our new home, taking a big vacation, stuff that for my whole life has been considered living it up. For others, these things might just be everyday or "needs", but I grew up really poor, so by comparison I am living the good life now and can see even better in my future.
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