You may look forward to your retirement, but most retirees face less than perfect lives what with their mortgages still hounding them. In 2016, 60-year-olds and older Americans borrowed as much as $2.84 trillion for their homes, and many of them continue to pay their loans well into retirement.
Some authorities may argue that housing debt in retirement can be a good thing, but it will remain as the single biggest expense you have. You can have a debt-free retirement, however, by following one of three ways.
Pay Down the Loan
Now, you probably already know one way how to retire without a mortgage: you simply have to pay off your loan before you retire.
No matter what age you are, no matter what mortgage rates you have in your Ogden mortgage, you can pay off your home loan quicker if you add in extra payments every month, semi-annually, or annually. Alternately, you can also pay any cash bonuses you receive towards your loan.
Downsize the House
The second way to retire without a mortgage involves downsizing. Downsizing can work perfectly for couples whose children are already grown-ups. You can sell your current home for a much smaller one you can happily live in, and the profits can go towards your home loan.
You can also downsize even if you still have children at home.
Refinance the Mortgage Terms
Thirdly and finally, you can refinance. Refinancing makes sense if your credit score went up or current interest rates became more favorable. When you refinance, however, choose a 15-year mortgage that you can pay off by the time you retire.
You also end up with more savings in the long run, and you can even combine this with the first suggested method: refinance then pay down the loan.
You can easily retire debt-free with any of the three methods above, and they will work best if you start on them early enough. Come retirement, you can relax and give no thought to your housing loan expense.