Maybe because of my limited experience, I am only familiar with the payroll income earned by work. At a few of the smaller companies that I happen to know about, the oldest employee is likely, say, 60 years old.
I am in an industry which highly favors young people by its nature - A decade ago, there was even a “rumor” that a certain company in this industry even only prefers somebody who is not married yet because they think those unmarried young people are more likely willing to devote more of their life to work - as long as they get free breakfast, lunch and potentially (not so good) dinner as well. Some of them could be burnt out by the age of 50 so 65 yo is indeed old for workers in this industry.
I know some people rely more on un-earned income, or income other than salary/wages… But I rarely have had a chance to meet these people so I do not know much about their world.
I mostly wonder how wage earners (with a modest income) who move every 6-8 years may handle their housing/mortgage when they are 50 or 60 years old. They may not be able work for another 15 years when they buy their last house in their life.
Still paying off at 52 (figure I have about 75% equity in my current house). I plan to sell later this year, and assume I WILL have a mortgage in my next place as well (likely condo purchase), but will pay it off within 5-7 years. Goal is to be mortgage free by retirement.
For us, our mortgage payment is less than it would cost to rent a smaller house. Plus, the lion’s share of the payment at this point is principal, so it goes into equity. This would be a good argument for someone who does not have cash or investments. For us, the present value of the remaining interest is less than the tax pain we would inflict upon ourselves for trying to pay off the mortgage.
One thing people sometimes forget is that property taxes and insurance do not go away with the mortgage payoff.
I’m deeply offended by the title of this thread, BTW! We are not “old,” we are just mature and wise.
MCAT…many folks who have purchased newer homes over the years have been fortunate to have equity from their previous homes to use towards their newer purchases.
And some folks relocate to much less expensive real estate markets.
For example…if you live in CA (I think you do), you could be able to sell there when the time comes, and purchase in a much less expensive real estate market…and have a very small mortgage…or maybe none…when you get to that ripe old age of 55.
I apologize for my use of the offending word “old” in this context. It was not my intention to offend “mature and wise” people here. The “nuisance” in a language is not easy for me to pick up!
People usually agree that, after the last payment to their child’s college expenses has been made, they should divert more of their newly free-up income to their retirement account (like 401K). Little do I know that they should also more aggressively pay off their mortgage simultaneously at this age. If they can not comfortably do both, which should take the priority?
H and I are in our mid-50s and still have a small mortgage. Our payment is less than $400/month, and it’s our only debt. I’m in no hurry to pay it off. Also - we’re not old!!
My mother bought a condo last year and had no trouble getting a 30-year mortgage. She was 82 at the time and hasn’t worked in quite a while.
@scout59, She will pay off her 30 year mortgage at 112 years old if she does not accelerate the mortgage payments.
Is $400/month payment only for the principal and interests? For my house, the portion of payment besides the principal and interests is likely higher than $400/month in my case.
mcat, I hope you are just kidding! No one has to pay off the mortgage before they die. They just have to make monthly payments. Mortgage is a secured debt - secured by the house. When the house is sold, debt holder gets first dibs on the proceeds.
A good reason to get a new mortgage at an old age is maybe to stretch out how long you’ll live. If a ninety year old gets a new 30 year mortgage, he’ll have to live to 120 because he’s got to make 360 monthly mortgage payments or else the bank will be dunning you at your grave!
I worked with a guy who bought a very high end home- he said ‘I never plan to pay it off’ and that was a concept that was foreign to me. He just planned on basically making rent payments then walking away from it when he wanted to. We paid ours off early and the college payments weren’t so painful. I do run into several people in their 70s and 80s who because of finances have either have moved in with their kids or their kids have moved in with them to pay for housing. I have yet found it an ideal situation. I have also seen several take reverse mortgages ( I don’t like the idea but maybe it works for some people).
@thimper1, I have already passed the age you mentioned. Also, we decided to keep the house we used to have in our old state (so we become a somewhat reluctant landlord there) and temporarily rent an apartment in the new state. We really like to move closer to our adult child when we move again (to the other coast.)
One of my colleagues has managed to keep almost everyone of his houses that he has lived - he ends up with 4 houses now. I do not know how he manages to a achieve that (esp. two of them are in expensive areas in California.) And he does this with one salary income in his whole life (and raised multiple children too - albeit in a slightly cheaper way - every kids at state schools and undergraduate only. Wedding for the offsprings? Mostly the kids rely on themselves to fund it.) Still, it is quite amazing to me that he has achieved that – it could be the case that ordered-out pizza is already expensive food to him though. He controls his budget with an iron fist.
That’s why refinancing never made sense to me: you get a new mortgage with lower interest rate, but longer term, so that overal debt gets higher. For the same reason, selling and re-buying a house does not make financial sense either, but sometimes there other reasons to do this such as relocation, downsizing, growing family etc. We were lucky enough to stay put for 15 years, so our first and only house (bought when I was 32 yrs old) is completely paid off.
52 with ten years of mortgage on our only home. DH is in the midst of taking a retirement planning class and the teacher specifically said that paying your mortgage early is a less-advantageous use of funds than putting it into investments. So if I ever come across any discretionary money we will know what to do with it Alas, I think we are many, many years from retirement and from any discretionary funds…
@Bromfield2, Thanks. It seems that word is also used in music performance, e.g., the way a particular violinist plays a particular passage of a piece of music. (I could be wrong here again though.)
@mycupoftea, We regret we have refinanced our house a little bit too many times. (We have also moved more times than we should have, e.g., moving into a better school district, job relocations, etc. If we kept paying our very first house which had a 15-year mortgage, we would have paid off that house more than 10 years ago!)
I had us prepay an extra $500+ on our $1500 mortgage payment each month so we would pay it off by the time H was ready to retire at 70. We could have easily kept paying it in retirement but didn’t know what our finances would be like and thought they’d be MUCH lower than they are.
If we find a property we like that our kids may want to live in, we may buy it and get a new mortgage. I’m pretty sure we’d have no trouble getting a mortgage, as H gets a significant defined benefit pension with COLA, plus we have other income and assets. We did get a $250k home equity line of credit at no cost, with no appraisal (which we have never drawn on).
Many people prefer to pay off debt as soon as they can, but it is personal choice. Many people don’t consider mortgage “bad debt.” Personally I love being wholly debt free!
My wife has a big heart for our child. She decides to keep paying down the interests portion of our child’s student loans instead of applying it toward our mortgage. She kind of has made a “promise” to our S that the total student loan amount for him to be responsible for will not exceed a certain amount (which is just about a half of the median of student loans of all graduates.) My S had better be very nice to her after I am gone (I expect my life span is shorter than hers.) Her priority may not always be the same as mine but I am easily convinced to follow her in this regards.
We are not “old,” we are just mature and wise. 