As you approach the date of your retirement, you may start to feel a little bit worried about all the changes you are going to experience in your life. Some people worry about their financial situation upon retirement, especially if they have a mortgage that they will need to pay during their retirement. If you are retiring with a mortgage, there are a few things you should do to make sure that you are still financially secure.
Downsize Your Home
If you know that you are going to have a mortgage in retirement, one of the best things you can do is to actually downsize the home you will live in. This can help you to decrease your mortgage payments and reduce the upkeep you need to do for your home. As you think about downsizing, you should consider the stairs in the home you purchase, and the ease of navigating the space. These details may become more important as you age and your accessibility needs change over time.
Find Extra Income
The mortgage you have may require you to earn more income than your retirement fund can provide. In these cases, it can help to have a little bit of work on the side that can offset the costs of your mortgage. You can earn extra income in a variety of ways that can help you to feel fulfilled and have extra money that can go towards your income. You should not find work that is overly taxing or feels as stressful as your normal job (since that defeats the purpose of retirement). Owning rental properties can be a great way for you to earn extra income without too much additional work. Additionally, long-term tenants help reduce vacancy rates.
Pay Off Your Mortgage as Quickly as Possible
If you want to make the most of your retirement, it helps to get rid of your mortgage payment as soon as you can. By making extra payments on your principal balance each month, you can shorten the term of your mortgage and decrease the amount you pay in total. This can help you to have a more fulfilling retirement, and to have less to worry about finances as you get further into your retirement. It is essential that you indicate that your extra payments are going towards the principal rather than interest.
Having a mortgage in retirement can present you with some major challenges, but that doesn’t mean you can’t overcome them. Everyone’s situation is different, and it is okay to find your own path through retirement. As you work on moving forward, you can make decisions that will make your retirement truly amazing.
Check out this article on big decisions you need to make before retiring!