Many pre-retirees focus on being mortgage-free by retirement, aiming to reduce expenses. However, carrying a mortgage can provide certain benefits, such as tax deductions on interest payments and financial advantages if rates are low. With about 4 million Americans retiring this year, it’s crucial for individuals to assess their overall financial position, including their mortgage. A low interest rate mortgage may allow them to utilize funds more effectively, potentially earning money while maintaining the loan.
If you're able to enter retirement mortgage-free, you'll have one less major expense to worry about at a time when you're transitioning into a new financial situation.
Consider your total financial picture and mortgage interest rate when making your decision.
You can deduct your interest. The mortgage interest deduction is available to people who itemize on their tax returns.
If you're paying a very low interest rate on your mortgage, then keeping it in retirement could actually enable you to earn money.
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