Quote:
Originally Posted by roob1
Assuming you have current and continued solid financial solvency, and could own your residence outright with no financial impact on your lifestyle:
Given low mortgage rates 2.5%-3.5%, how would you feel about holding a mortgage on your residence in your retirement years?
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I'm a big fan of having no debt, but you can easily make 4+% in the market with relatively safe investments. There are no guarantees and the bottom could drop out. As long as you can live long enough for it to recover, it seems like a better route to maintain or build wealth. You do need to pay attention though. Dumping a big chunk into an equity fund or a money market fund and forgetting about it is not a good choice either.
That said, if you can afford a mortgage with your SS/pensions/etc. maybe just get the lowest possible payment and spend the rest? If you're not planning on bequeathing your assets, spend it. The house will still build wealth that someone will get when you check out.
I guess the bottom line is how risk averse you are and how liquid you are. If you have 500k in a checking account and are paying a mortgage, you're losing value due to inflation, do one or the other. Pay off the mortgage or open a vanguard account and start buying to your risk tolerance.