Key Points
I recently watched a YouTube video featuring a young woman who looked like she’d just arrived home after a hard day at middle school. Gotta give it to the young lady, though; she spoke with confidence. According to her, most retirees own their homes free and clear. She went on to say how much further Social Security checks stretch without a mortgage, to which I internally responded, “No duh.”
I spent years dreaming of the day my husband and I would pay off a mortgage, but after 24 moves that led to buying and selling more houses than I can immediately recall, it’s not in the cards. We’ve known for a few years now that our mortgage will follow us into retirement. Here’s why I’m no longer worried about something that used to keep me awake at night.
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1. It’s our only debt
Taking a mortgage into retirement may not be ideal, but it is our only debt. The moment we realized the mortgage would still be around, we doubled down on paying off all other debt. While that may not seem as comforting as being mortgage-free, it does make budgeting for retirement — including fun stuff, like healthcare costs — a bit easier.
The mortgage rate we’re currently paying is about one-third of the average return on our investments over the past few years. Rather than throw everything we have a mortgage with a relatively low rate, we continue to use that money to grow our portfolio.
2. Only my husband plans to retire
I’ve never had an ounce of desire to retire — not full-time anyway. However, my husband has every intention of hanging up his hat one day. Let’s say he retired in three years. As long as artificial intelligence hasn’t totally taken over my job, my income will cover our mortgage. In fact, if I’m still working when it’s my time to claim Social Security, those funds can help cover the mortgage.
3. Being mortgage-free doesn’t mean being payment-free
Nearly half of our monthly mortgage payment goes toward property taxes and homeowners insurance. So even if we paid off our mortgage, we’d only knock out half the payment.
4. The math associated with moving doesn’t work
You may be curious as to why we don’t downsize (and you’d be right to wonder). Our home is conveniently located between our sons and their families. One family is three hours to our south, and the other is two and a half hours to the north. After decades of living thousands of miles away from loved ones, the current distance feels a lot like living around the corner from them.
We all live in relatively expensive areas, with purchase and rental prices nearly as high as our current mortgage. It makes very little sense to sell this home, put down a large chunk of money on a new place, and still have a monthly mortgage. We know we could relocate to a less-expensive part of the country (or world), but that would mean losing proximity to our family.
I know there are those who can’t imagine paying a mortgage in retirement, and I don’t blame them. The less debt you carry, the better. However, when I think of the amazing places we’ve lived and cultures we’ve had the chance to experience, I feel better about the number of moves we’ve made. Those experiences have been rich enough to help me accept the fact that a monthly mortgage payment will be part of our lives for the foreseeable future.
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