With retirement around the corner, your ideal situation is to finish work without a mortgage. That way you don’t have to worry about the extra payments, and can sit back and enjoy without any financial woes. But not everyone has the funds to pay off their mortgage in time for retirement. Get ahead of the game with these tips and strategies to pay it off before you retire.
Refinance your Mortgage
You can try to refinance your mortgage to get a better interest rate and new amortization schedule that will allow you to pay down your mortgage faster. If you can afford to take on a shorter term and higher payments, this might be the right option for you.
Turn Your Home into an Investment Property
Turn one of your empty rooms into a space you can rent out to make some extra money. An attic, garage, or basement is a perfect area to transform into a rental unit. If you have the option to pay lump sums into your mortgage, directly deposit the tenant’s rent cheques and watch the debt as it goes down.
Invest Part of Your Income
Taking 10% of your income each pay cheque and placing it into a savings account or mutual fund can help you acquire money faster. Plus, the amount is so small you won’t even notice it’s gone.
Drive One Car
Sacrifice for a few years and sell one of your vehicles. It may take some planning skills but carpooling, riding public transit, and/or walking to get around can help you save up much faster to get that mortgage paid down sooner.
Delay that trip until you pay it off
Instead of travelling for your next vacation, try a staycation instead. Vacationing at home can save you loads of money that you would otherwise spend on hotels, airfare, rental cars and food.
Take on a Part-Time Job
A part-time job can keep you busy and also help you save to pay down your mortgage. Whether it’s consulting on the side, selling goods at local craft fairs, or getting paid to timekeep at the local hockey rink, every little bit of extra income can help.
Having a mortgage after retirement can be a burden that can threaten your financial security and cause unnecessary stress. Don’t get stuck with a mortgage after you retire. With some careful planning and small sacrifices you can get your mortgage under control and paid off just in time. Contact us at 605-265-0246 and let’s talk about your mortgage options!