[Rzepecki]

Originally Posted by Brwne

We decided to carry a mortgage at these low rates because investment returns are generally higher. The caveat - the cash you would have used to pay off the mortgage (and the Bond?) must be invested and not spent.

We did the same for the same reason.

[Stu from NYC]

Originally Posted by b0bd0herty

I started to refi with Citizens First last year to take advantage of the lower rates. they wanted closing costs of $17,000 to refi $300,000. To me, it was just legalized usury and we canceled the loan. Then they said they would lower the closing costs by $7,000 which kind of supported my opinion.

Plan to stay here another (fingers crossed) 25 years and with no one to leave my estate to, will just go with a Reverse Mortgage.

Wow 17 grand in fees. Lennie the loan shark would give a better deal.

[PoolBrews]

Originally Posted by toeser

Did exactly the same thing. Now my wife gets considerably more SS than me, which is great because statistically I will be gone first and she will be better protected.

Why did your wife have to start at 65 and then stop? She is entitled to 50% of your SS regardless, so she could just wait until 70 and file.

Trying to understand what I'm missing here.

[Joe C.]

I don’t like having a mortgage ..... especially in this economic downturn, so I paid off my mortgage this month. This way, if my wife’s pension (from a state up north) goes bad, at least we will have a place that the bank can’t foreclose on. Same for my annuities .... if they go bad, we still will be ok.
Better safe than sorry.

[biker1]

Fortunately the 029 punch machines have been gone for a bit (40 years). However, I do miss the 029 punch cards because they are good for taking notes and they fit perfectly in a button down shirt pocket. Fortran has morphed into a modern language with support for recursion, dynamic memory allocation, pointers, data structures, interface blocks, modules, and more. It is still doing the heavy lifting for most things scientific.

Originally Posted by dewilson58

Fortran & IBM cards.................oh yes.

[CoachKandSportsguy]

Originally Posted by Joe C.

I don’t like having a mortgage ..... especially in this economic downturn, so I paid off my mortgage this month. This way, if my wife’s pension (from a state up north) goes bad, at least we will have a place that the bank can’t foreclose on. Same for my annuities .... if they go bad, we still will be ok.
Better safe than sorry.

This attitude is one of retirement is for the protection of wealth, not the maximization of wealth, is very healthy. The probability for state pension bankruptcies and other bankruptcies is not zero, and not a fixed probability. That's why there are re-insurance companies, to insure insurance companies. That is also the basis of the behavioral bias "recency bias"

Most if not all accidents or mistakes come from the assumption that all possible outcomes are assumed to be taken into account. Then after the accident the harmed usually says something to the effect that "I didn't see that coming". Same can be said for personal financial outcomes. Free and clear eliminates any risk of being called away for reasons beyond your control, or loss of assets/income backing the payment.
Ask pete carroll with the play which lost the superbowl to the patriots. Not one play has a probability of 100% guaranteed outcome, not even a kneel down.

Our 25 year mortgage, taken in 2014, will be paid off this year (2021), after 6-7 years, for this reason.

So Joe picked blue as well. . .

[Stu from NYC]

Originally Posted by lrvalley

Why did your wife have to start at 65 and then stop? She is entitled to 50% of your SS regardless, so she could just wait until 70 and file.

Trying to understand what I'm missing here.

If she did not file she would not get anything from SS.

By filing and than stopping she gets 50% of her husband's SS until she goes ahead and completes application. By waiting till 70 she maxes out her SS.

[CoachKandSportsguy]

my wife's book, not mine. . . .

[tvbound]

Originally Posted by Brwne

We decided to carry a mortgage at these low rates because investment returns are generally higher. The caveat - the cash you would have used to pay off the mortgage (and the Bond?) must be invested and not spent.

We plan on doing the same thing, for these reasons and one other. If I give in to the current requests for consulting piling up, the mortgage will help write-off the additional income. Primary residence interest rates remain at historic lows, so the difference between even what conservative investments can make (albeit, I've been leery of the inflated market on equities before the pandemic and only seeing it get worse, once the full ramifications are recognized by Wall Street) and the interest paid on a small mortgage, makes sense for us.

[Tom M]

As much as people want to be analytical about money, the truth is that money evokes emotional responses. That's the key.

Do you feel happy with your financial decision of keeping a mortgage and investing that money instead in something that can earn more (after tax) than the mortgage costs - so you can leave more for your heirs? Great, go for it.

Do you feel happy with the security of having debts paid of and no need to try to find investments that have a risk of falling in value? Great, pay off your mortgage.

Trying to convince a person who loves investing and the market return potential that paying off a mortgage at such a low rate is the wrong thing to do is just as bad as trying to convince a fixed return asset preservationist that paying off debt is bad.

The good news is that most people are great at rationalization and will end up being happy with the choice they made.

[biker1]

Anyone over the age of 60 who developed software should find the following very funny:

Real Programmers Don't Use Pascal

Originally Posted by CoachKandSportsguy

my wife's book, not mine. . . .

[CoachKandSportsguy]

Originally Posted by Tom M

As much as people want to be analytical about money, the truth is that money evokes emotional responses. That's the key.

The good news is that most people are great at rationalization and will end up being happy with the choice they made.

The definition of behavioral finance. However, by exposing the hidden biases, with financial education, one can potentially see the benefit of different options on their lifestyle.

But not always. CFP had constantly recommended to my dad to gift money from this estate prior to his death for estate tax, usefullness and control reasons. My dad could not do it, did not see or understand the benefit, as he was a depression era engineer with physics approach. his response was largely a depression generational response and partly a personality type bias. Concepts and abstract future were incomprehensible to him. ie, I put up his mailbox without taking measurements, and he did not like that at all. . . measurements assured him of his process were correct.

So totally agree with Tom M, which is why when posting on an open global forum, one has to accept the debaters, the lawyers, and the common knowledge statements. Good read:
Amazon.com

[manaboutown]

///

[manaboutown]

Originally Posted by Tom M

As much as people want to be analytical about money, the truth is that money evokes emotional responses. That's the key.

Do you feel happy with your financial decision of keeping a mortgage and investing that money instead in something that can earn more (after tax) than the mortgage costs - so you can leave more for your heirs? Great, go for it.

Do you feel happy with the security of having debts paid of and no need to try to find investments that have a risk of falling in value? Great, pay off your mortgage.

Trying to convince a person who loves investing and the market return potential that paying off a mortgage at such a low rate is the wrong thing to do is just as bad as trying to convince a fixed return asset preservationist that paying off debt is bad.

The good news is that most people are great at rationalization and will end up being happy with the choice they made.

I use what I call my 'sleep at night' test. I pretend I have done a financial thing and then see how I can sleep with that decision.

[manaboutown]

Originally Posted by b0bd0herty

I started to refi with Citizens First last year to take advantage of the lower rates. they wanted closing costs of $17,000 to refi $300,000. To me, it was just legalized usury and we canceled the loan. Then they said they would lower the closing costs by $7,000 which kind of supported my opinion.

Plan to stay here another (fingers crossed) 25 years and with no one to leave my estate to, will just go with a Reverse Mortgage.

Whoa! The fees on a reverse mortgage would be even higher than $17K!