# Senior Economic Theory



## imp (Jul 15, 2015)

The idea I've always heard promulgated was that as retirement was approached, one's financial obligations, mortgages, debts, should have been "paid down" such that upon retiring, no fixed payments would be required, other than normal ones such as rents, utilities, etc.

Have others labored under that belief, too?   imp


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## Warrigal (Jul 15, 2015)

We're in that happy position, having paid off our mortgage in 1985.
It helps that we  have been in this same home since 1966.


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## Ken N Tx (Jul 16, 2015)

All but our mortgage have been paid down...Life would be a little better with it gone!!!


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## ronaldj (Jul 16, 2015)

life is better with it gone......although without the dragon of debt ....what do we fight against....


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## Don M. (Jul 16, 2015)

imp said:


> The idea I've always heard promulgated was that as retirement was approached, one's financial obligations, mortgages, debts, should have been "paid down" such that upon retiring, no fixed payments would be required, other than normal ones such as rents, utilities, etc.
> 
> Have others labored under that belief, too?   imp



THAT is probably the BEST thing a person can do to prepare for their retirement.  Having debt, on a fixed income, is a sure recipe for a meager existence.  Home mortgages, credit card debt, car loans, etc., etc., should NOT be part of a persons issues when they retire.


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## SeaBreeze (Jul 16, 2015)

I agree that preferably everything would be paid down before retirement.  We paid off our mortgage before we retired and never accumulated credit card debt, if we couldn't afford to pay off the credit card in full when we got the bill, then we couldn't afford to make the purchase.  Worse thing to have to do after retirement is go back to work to keep up with debt, IMO.


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## Jackie22 (Jul 16, 2015)

When I bought my new car recently I financed $5000, only because the interest I pay on the $5000 was less that the taxes that I would have to pay on money taken out of retirement funds, that car payment is the only installment I pay.


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## Vivjen (Jul 16, 2015)

Quite right, Jackie; that is exactly what I did; until the interest rose on the car.....then I paid it off!


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## 911 (Jul 16, 2015)

I financed a car maybe 5 years ago at 0% interest thinking that it was better to do it that way and keep my money earning growth and dividends. It finally got to me after making about 7 or 8 payments and I had to go pay it off.


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## imp (Jul 16, 2015)

Seems most folks see that retirement is not, for most, the time to be encumbered with debt. I've always believed that quite  strongly; it was instilled by my folks: pay off a mortgage as soon as possible, they said. My uncle, dabbling in real estate in CA in the '50s and '60s, during intense growth periods there, admonished me when we discussed this topic: he believed one's equity in property was not "working for them" without a mortgage in place.

In our own case, we built our own house outside Phoenix, lived in it 10 years, then sold it, having had 100% equity in it. During the following 13 years we were mortgage-free, but alas, here we are back in AZ with a fairly large mortgage casting a shadow on our security.       imp


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## Lon (Jul 16, 2015)

imp said:


> The idea I've always heard promulgated was that as retirement was approached, one's financial obligations, mortgages, debts, should have been "paid down" such that upon retiring, no fixed payments would be required, other than normal ones such as rents, utilities, etc.
> 
> Have others labored under that belief, too?   imp



The day I officially retired in1991 I was with out debt of any kind and other than my current Visa Card nothing has changed.


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## Glinda (Jul 16, 2015)

I paid off my mortgage at age 53.  I have no debt whatsoever.  It's a wonderful feeling!


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## Capt Lightning (Jul 17, 2015)

We managed to clear all our debts by our early 50's and have maintained that since then.


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## imp (Jul 22, 2015)

My wife has pointed out that, should I croak suddenly, her monthly income would become garnisheed to the tune of 50% for the mortgage payment. Is life insurance an option? Probably not; cost prohibitive.    imp


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## 3horsefarm (Jul 22, 2015)

My little mortgage was the only payment left, other than utilities. At $230 a month for another 8 years, don't guess it will kill me.


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## Don M. (Jul 22, 2015)

Carrying debt in retirement....especially something as large as a mortgage....is a sure way to limit the possible enjoyment of retirement.  The interest paid on home loans doubles or triples the cost of the house, if carried for a full 30 years.  Banks love mortgages...that, by itself, should tell people what a raw deal debt is, for the homeowner.


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