Should I pay off my house before retiring?

Question

As things stand, I am getting close enough to retirement that the decision no longer feels theoretical. As things stand, I have savings, Social Security, and possibly other income, but I do not know whether the total can support my actual spending for several decades. My spouse or another relative has a stake in the outcome too, so liquidity, taxes, and flexibility matter more than they would if I were deciding only for myself.

Soradin · Accepted Answer

Lower debt can reduce required spending, but using too much cash may reduce liquidity and tax flexibility. For this planning decision, retirement readiness depends on expected spending, income sources, savings, taxes, health costs, inflation, and longevity. A written financial plan should lay out cash needs, timing, taxes, liquidity, and the risk of a bad outcome before money is committed.

Should I pay off my house before retiring?

Soradin

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