Terry, we have less than five years of payments left on our mortgage and we will be retiring in about eighteen months or so. (Balance approximately 24,000) at this point, does it make sense to make an additional 100.00 extra payment towards the principal until we pay it off with savings from a money market account upon retirement time? We have no other outstanding debt.
Terry Says: I am 100 percent in favor of paying off a mortgage BEFORE you retire. Paying extra is good. But I’m going to ask you to reassess your retirement plans to see if you can keep working until you can pay off the mortgage from current earnings — and not dip into savings. You may need more money in retirement that you are estimating. In fact, without knowing your ages and health situation, or your total assets, I’m going to say that you really need to consult a financial planner to get an independent overview. Go to www.FeeOnly.org — to find a financial planner that will sit down with you for an hour or two at a flat rate to at least give you the big picture.