When is too old to buy? (social security, friends, married, payments)

[marmac]

A person should never be making house payments or paying rent from his retirement income.

If he is living in the same house after retirement as before, it should be paid for by now.

If he is now renting,but used to own a house, the sale of that house should be covering his rent payments.

This country got in trouble when every Tom,Dick, and Harry fell for that old line--" cash in your equity"

Thus people are retiring and still have mortgage payments. ( not very bright thinking)

[Wicked Felina]

Originally Posted by marmac

A person should never be making house payments or paying rent from his retirement income.

Thus people are retiring and still have mortgage payments. ( not very bright thinking)

It may not be very bright thinking to you but as has been said, life interferes with the best laid of plans.

First my father, then my mother, became very ill right after I got divorced. Most of the money I had to purchase another house went directly into their care. Nearly one-third of my income was also spent on their care. This went on for several years. I do not regret it for a second that I chose to take care of my parents. Ever.

Of course I would love to own a house. But the only possibility of my doing that means relocating to a much smaller out-of-state town with lower COL and only if I got a 30-yr mortgage.

As Tesaje said, why should that be a problem if one can afford payments and upkeep on a home, condo, trailer, or whatever. There's not a particular cut-off date (age) when it becomes unfeasible, IMO.

[janetvj]

Originally Posted by marmac

A person should never be making house payments or paying rent from his retirement income.

If he is living in the same house after retirement as before, it should be paid for by now.

If he is now renting,but used to own a house, the sale of that house should be covering his rent payments.

This country got in trouble when every Tom,Dick, and Harry fell for that old line--" cash in your equity"

Thus people are retiring and still have mortgage payments. ( not very bright thinking)

Not "bright thinking"? What a ridiculous statement. If your retirement income is secure and is sufficient to cover the mortgage as well as other expenses, then it is no less of an issue to have a mortgage on a retirement income than it is on any other type of income.

IMO, what is not "bright thinking" is staying in a job past the point where you are productive and challenged, in effect making 50% of what you should be earning (after allowing for the pension that would be paid to you simply by waking up each day), and putting off all of the things you want to do and have earned the right to do after working your butt off for the last 30 or 40 years.

[marmac]

Originally Posted by janetvj

Not "bright thinking"? What a ridiculous statement. If your retirement income is secure and is sufficient to cover the mortgage as well as other expenses, then it is no less of an issue to have a mortgage on a retirement income than it is on any other type of income.

IMO, what is not "bright thinking" is staying in a job past the point where you are productive and challenged, in effect making 50% of what you should be earning (after allowing for the pension that would be paid to you simply by waking up each day), and putting off all of the things you want to do and have earned the right to do after working your butt off for the last 30 or 40 years.

--" and have earned the right to do "--

Nobody has a right to anything if they don't have the money earned to pay for it.


Your post reminds me of those tv ads to refinance your house to take a vacation/go on a cruise.

They also said--------" you deserve it "

You sure don't hear or see as many of those ads after the housing market crashed.

[janetvj]

Originally Posted by marmac

--" and have earned the right to do "--

Nobody has a right to anything if they don't have the money earned to pay for it.


Your post reminds me of those tv ads to refinance your house to take a vacation/go on a cruise.

They also said--------" you deserve it "

You sure don't hear or see as many of those ads after the housing market crashed.

I disagree. I worked well over 30 years at a government job and deferred a portion of my salary into the state pension system. It's my money, and therefore drawing that pension is my right. It's part of my compensation package that I agreed to when I signed up to work there.

And you missed my point - if you have the income and can afford the mortgage, then the source of the income is irrelevent.

[marmac]

-------" and you can afford the mortgage "---

I'll bet everyone who got their mortgage foreclosed on believed they could--" afford the mortgage"---when they bought their house and signed.

Once the " cash cow" ( refinance, home grows in value,refinance, home grows in value, refinance) became dry, things changed.

My point being--------unless your retirement income is the same or more as when you were working, what are you willing to give up to make those mortgage/rent payments.

And if a person earned so much money in their working years and stashed so much away that they can live better ( or the same ) as in retirement--------why the heck would there still be a mortgage at retirement age ?

[janetvj]

Originally Posted by marmac

-------" and you can afford the mortgage "---

I'll bet everyone who got their mortgage foreclosed on believed they could--" afford the mortgage"---when they bought their house and signed.

Once the " cash cow" ( refinance, home grows in value,refinance, home grows in value, refinance) became dry, things changed.

My point being--------unless your retirement income is the same or more as when you were working, what are you willing to give up to make those mortgage/rent payments.

And if a person earned so much money in their working years and stashed so much away that they can live better ( or the same ) as in retirement--------why the heck would there still be a mortgage at retirement age ?

Actually I looked at what my income was in 1994 when I bought my house and compared it to what my current pension is. Even adjusting for inflation my current retirement income is about the same as my salary was when I qualified for the house. In addition, my expenses are less (kids are grown, no FICA or other adjustments coming out of my check, cars paid for, etc.) So if I could afford it then, I can afford it now.

And I was not one of those people who pulled all the equity out of my house. I originally had a 30 year mortgage. In 2006, I refinanced to a 15 year mortgage for a better interest rate and a shorter term. I made a decent income, but not enough to pay the house off any sooner. My payment went up a few dollars due to the shorter term, but not much due to the lower rate.

My point is that if I could afford the house on my salary (and clearly I could), then I can afford the house on my pension.

Sure, it would be nice to have it paid off. But the fact that it isn't certainly doesn't make my decision to retire not "bright thinking".

[Tesaje]

Originally Posted by marmac

-------" and you can afford the mortgage "---

I'll bet everyone who got their mortgage foreclosed on believed they could--" afford the mortgage"---when they bought their house and signed.

Once the " cash cow" ( refinance, home grows in value,refinance, home grows in value, refinance) became dry, things changed.

My point being--------unless your retirement income is the same or more as when you were working, what are you willing to give up to make those mortgage/rent payments.

And if a person earned so much money in their working years and stashed so much away that they can live better ( or the same ) as in retirement--------why the heck would there still be a mortgage at retirement age ?

It is absolutist thinking like this that gets people into trouble. As in all life plans, the answer is: It depends.

As Jane cited, it can make perfect sense to keep the mortgage. She was not foolish, she lived within her means, she worked hard, and she made her choices with her long term security in mind. She retired having made the calculation that she can still afford the mortgage and do so. It is not foolish - it is a planned choice that is working out very well.

I made the choice to pay off my mortgage and was able to do so by applying extra payments for many years plus a re-fi 6 years ago to greatly reduce interest payments. I will retire mortgage free and that was my long term plan to do so.

My brother bought a house about 3 years before he retired and planned to carry the mortgage into retirement, having calculated out that he could do so safely. He was able to pay it off many years early on his retirement income. He makes less in retirement than he did while working, by the way. This was also a wise choice. Yet another plan that works well.

While there is a huge problem with failing and foreclosed houses and people who have mortgages much higher than the current value of the house, the reality is that the vast majority of people who have mortgages, while working or retired, are perfectly able to pay them, are not under water, and the loan is not going to go out of control with an ARM.

Unfortunately, it only takes a small percentage of people in trouble or fraud to get the economy in trouble. Handled sensibly, a mortgage is a sound method of buying a property and the only way for most people to be able to do so. If your finances can handle it, there is no reason not to have one in retirement.

There is not a single wise choice for everyone to plan how they will live in retirement. There are some very unwise choices but what is unwise for one situation might work out very well in another situation.

[Fat Freddy]

Before we retired, we paid rent every month.
Then we had our retirement house built.
Now we pay a mortgage payment every month.

Before we retired, the Landlord owned the house we lived in.
Now the Bank owns the house we live in.

The only difference is that now our house is exactly like we want it, and if it's not, we can change it.

[forest beekeeper]

I also believe that to retire a person should no longer be paying rent or a mortgage.

I have renters who are on pension. So I do understand that it happens. But I do not feel that such a retirement was very well planned.

For young adults, couples and families; the expense of housing is commonly the largest expense of their monthly budget. Once you removed that expense everything else gets much easier.

I would not have retired, if I still had such an expense to be paying.