My husband and I are retired and have approximately $1.4 million in IRA/retirement funds. Our home has value of $500,000 and we hold a 15 year mortgage for $89 K at 3% interest, due in about 8 years. Should we consider paying off the mortgage?
I see no reason to pay off that mortgage at such a low rate — unless it is really driving you crazy. Remember, you’ll have to take out almost twice as much as you owe, in order to have money to pay taxes on the withdrawals. By now, you are probably taking Minimum Required Withdrawals anyway. So if you have “extra” money from those withdrawals, you can always make a once-a-year additional payment on your mortgage and ask the lender to credit it against principal due.