For those who have retired, it can be difficult to work a mortgage payment into a monthly budget. That is because most retirees are on a fixed income, and even when their retirement plan is combined with their Social Security income, they may still not be able to afford a mortgage. There are a few things that retirees can do before they officially retire to help their budget, even if they still have a mortgage.
The first option is to sell their home and rent. Many find this a good option because it not only decreases their monthly payments but also reduces the amount of upkeep they have to do to their home. Apartments, especially gated apartment complexes, are also often safer for seniors.
Another option for retiring without any mortgage debt is to refinance the mortgage into a shorter loan before retirement. This does several things. First, while it makes the monthly payment a little higher, it means that the mortgage is paid off sooner. That also means the amount paid in interest is significantly reduced, saving a large amount of money.
Finally, for those who want to continue owning a home, it may be worth selling and then buying a smaller house, which could be paid for outright from the sale of the original property.
Let the free MoneyTips Retirement Planner help you calculate when you can retire without jeopardizing your lifestyle.