For years, retirement was the milestone where you pay off or plan to pay off your mortgage debt. However, an increasing number of Americans are either reaching the retirement or retiring with a mortgage debt. According to a recently released report, more and more Baby Boomers are retiring with a mortgage debt more than ever. Not only that, they are upsizing with newer mortgages and also planning remodeling projects during the retirement too.
Should you pay off your mortgage debt before retiring? There is no one answer. Many want to pay off their mortgage debt before retirement because their income going to be less during the retirement. Many others are not in a hurry to pay their mortgage debt because it carry a lower interest rate compared to other loans and give a tax advantage. One rule of thumb is to pay off the mortgage debt before the retirement provided that it is not going to prevent you from contributing to your retirement at the maximum. Financial advisors do not recommend taking funds from your retirement account to pay off your mortgage debt. Some recommend retirees with a mortgage to pay it every two weeks to cut down on the interest.