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If you’re nearing retirement without having paid off your mortgage, you’re not alone. The number of homeowners aged 65 and over with housing debt doubled between 1989 and 2019, from 21% to 42%, according to the Joint Center for Housing Studies at Harvard University.

For many years, financial experts recommended that older Americans do their best to pay off their mortgages before entering retirement. And the logic was simple. Once you retire, you may see your income decline. So it’s best to shed all possible debts and expenses, including monthly mortgage payments, ahead of that period.

But while the old convention used to be to try to pay off a mortgage ahead of retirement, these days, that may not be advice you want to take. Here’s why.

It could pay to carry a mortgage if your rate is really low

In 2020 and 2021, mortgage lenders slashed rates in response to the economic crisis spurred by the pandemic. Not only did new home buyers get to lock in low rates at that time, but many existing homeowners refinanced their mortgages to take advantage of low-cost borrowing opportunities as well.

If you refinanced your mortgage a few years ago, you may now be paying under 3% for your mortgage, since rates like that were available at the time. And if so, it could pay to carry your mortgage into retirement, even though that means having another monthly bill to keep up with.

Right now, many high-yield savings accounts are paying upward of 4%. So if your mortgage is costing you 2.75%, it makes sense to keep more cash in the bank and keep paying that loan.

Even if savings account rates fall, if your mortgage payments are affordable to you, it could pay to continue carrying that loan in retirement. Once your career ends, it’s important to leave yourself with liquid cash in case of an emergency or an extended market downturn (a period when you’d want the option to leave your investment portfolio intact).

So let’s say you owe $80,000 on your mortgage. Rather than empty your savings account to pay off that balance, you might as well leave yourself with access to that cash if your home loan isn’t costing you a lot. And remember, any interest you continue to pay on your mortgage is tax-deductible if you itemize on your tax returns.

Advice that needs an update for some people

If you’re carrying a mortgage with a higher interest rate attached to it and have the ability to pay it off prior to retirement, then you may want to do so. But if you’re sitting on a rate of under 3%, then frankly, it could pay to just hold onto that loan and stick to your current repayment schedule.

That said, for some people, the idea of owing money on a mortgage in retirement can be stressful. So even if you have a low rate on your home loan, if keeping it will cause you to lose sleep and you’re able to pay it off, you may want to do so. Otherwise, know that you’re not necessarily blowing up your retirement finances by continuing to pay off your home.

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