Quote:
Originally Posted by Road-Runner
After reading through hundred's of listings in the Villages over the last several years prior to buying, it seems like the bond is almost an afterthought compared to the listing price. Although "No Bond" is listed as a selling point I don't know that it registers with most buyers how much debt the average bond is on new homes until after they pick a home to buy.
With that in mind, would it be crazy to pay off the bond vs paying down the mortgage by an equivalent amount? We're still working and our house in Bradford will be a 2nd home for at least 2 more years. When we sell here we'll want to reduce our monthly costs to the minimum possible so planning on using all the proceeds from the sale to reduce our only remaining payment, the house.
Just curious if others have gone through the same decision process.
Thanks, Jim
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My two cents worth-for free
We do not know you or your finances. I would seek professional advice from someone
you are willing to share all your information with. Hopefully an accountant that you have been dealing with for years. Why pay either off? It is far easier to tie your money, cash, into a house than to take it out should you need or want to. What are you, can you earn on that cash if you invest it. Yes, it is far more risk than having it sit in a day of deposit day or withdrawal account. Interest on the bond, yours may be less or more is 4-5%.
Mortgage is should be less than 3%. Long term stock market returns are 7-8%-depending on who or what you believe. I've done far better than that over the past 15 years.
You can easily set up your own annuity with out paying the outrageous commissions.
You go to a brokerage, put that cash into a fund and tell them to send a check every month that will cover your mortgage payment.
Whatever you decide. I would not do anything now. Our economy, our tax system is certainly in transition-like it or not. Our real dollar value is also in transition-like it or not.
Like the old advice. With the death of a spouse, or a divorce delay two years before making any commitment. I would wait until you move in full time. It is far less costly to do nothing then to do the wrong thing. Plan as you might, your taxes and your expenses will change dramatically when you quit working.