We get this question a lot here at the office, so let us give you our most common, quick analysis of the question of whether or not you should pay off your mortgage.
While every client’s situation is unique and is considered separately, the answer is probably yes, you should pay off the mortgage. Especially if you have the privilege of asking the question!
Now we aren’t talking about folks in their 20s buckling down to make quadruple payments on a low-interest loan.
One of two scenarios is usually at play when we walk clients through this:
- A family or individual getting ready to retire or downsize their career.
- Someone who has the cash to pay off the mortgage but is debating whether to pay it off or to invest.
While there is a mathematical argument for keeping a low-interest mortgage, that strategy is typically only appropriate for folks who have the money to pay it off anyway—often many times over.
In the case of an average family, most often the analysis favors having one less bill to worry about.
Many clients seek the sense of freedom that comes from owning their homes outright.
As an important footnote, we have noticed over years of experience that clients with more financially successful retirements—no matter how modest the means—retire or plan to retire without a mortgage.
There are so many considerations as you prepare for retirement, and we provide an experienced listening ear. If you would like to make an appointment to discuss your situation, we would love to visit with you.
Please visit our website for more articles in the FAQ Series: www.cornerpostfinancial.com.
Content in this material is for general information only and not intended to provide specific advice or recommendations for any individual. All investing involves risk including loss of principal. No strategy assures success or protects against loss.
Securities offered through LPL Financial, Member FINRA/SIPC. Investment advice offered through ICA Group Wealth Management LLC, a registered investment advisor. Corner Post Financial Planning and ICA Group Wealth Management LLC are separate entities from LPL Financial. LPL Financial does not provide tax or legal advice.