Retire Without a Mortgage

Will Your Home be Paid Off When You Retire?

Time to RetirePlanning for retirement is obviously important, and many times even a vital goal is plagued by procrastination. Some people plan to have their home paid for by that magical date so they won’t have payments after they retire. It makes sense to eliminate a large recurring expense before they quit working.

Do You Have a Plan?

One strategy is to make regular principal contributions in addition to your required mortgage payment, so the debt will be paid in full by your target retirement date.


Let’s say that a homeowner refinanced their 4%, $200,000 mortgage last year with the first payment due on May 1, 2012. Under normal amortization, the home would be paid for at the end of the term; 30 years in this example.

Additional principal contributions with each payment would accelerate the payoff on the home.

  • An extra $250.00 a month would pay off the mortgage in 20 years.
  • $524.55 extra with each payment would pay off the loan in 15 years
  • $796.23 would pay off the loan in 12 years.

Benefits to You

Having a home paid for at retirement has the obvious benefit of no house payment. It is also a substantial asset that could be borrowed against or sold if unanticipated events should occur.

Another strategy might involve purchasing a smaller home now to use as a rental that you intend to live when you retire; see Do You Own Your Retirement Home?

Use Our Live Calculator to See Your Numbers

To make some projections to pay off your own mortgage, use this Equity Accelerator. Please let us know if we can assist with anything.

time to retire graphic

Leave a Comment