Paying off your mortgage before you retire has a multitude of benefits, but there may be a few instances during which you want to wait. In this video, Angela Wyckoff explains some situations where you may not want to pay off your mortgage early.
Paying off your mortgage before retirement could reduce your monthly expenditure and give you some much needed peace of mind. But, there are some situations where you may NOT want to pay off your mortgage early.
First, ensure you have enough cash reserves for living expenses. The cost of everything is going up and this should be your main priority.
Secondly – you should avoid liquidating your retirement savings to pay off your mortgage because of the taxes that will be taken out. Early withdrawals have heftier tax penalties.
And lastly – if you have higher interest debt, you should focus on paying that off before paying off your mortgage. If you do decide to pay off your mortgage early, you can refinance to a shorter term, which comes with lower interest and higher payments, or switch to biweekly payments. Check out this video to learn more about that.
As always, we are here to answer any questions that you have about your mortgage. Visit us at amerifund.com for more info.