Fill out this form to email this article to a friend
Paying off condo is a sound idea
By HELEN HUNTLEY
Published April 25, 2006
My 76-year-old mother is very unhappy with - and tired of - paying $2,500 a year in mortgage interest, which she considers lost money. She wants to use her savings to pay the $40,000 remaining on her condo mortgage and says she could live well on Social Security and pension and would pay the monthly mortgage payment back into her savings. What is your view on the matter? I think she's got a great idea. As a general principle, I am in favor of retirees paying off their mortgages, especially because they often aren't able to deduct the interest because they don't have enough other deductions to be able to itemize. As far as I am concerned, there's only one potential drawback in her situation. Will paying this $40,000 wipe out or nearly wipe out all her cash reserves? As long as she still has enough reserves to feel comfortable, I don't see a problem. She also could take out a home equity line of credit after her mortgage is paid off, but not use it. That way she would have borrowing power available to her in case of emergency. Helen Huntley writes about personal finance issues for the Times; this answer to a reader's e-mailed question appeared on Huntley's Web log, or blog, at www.sptimes.com/blogs/.
[Last modified April 25, 2006, 07:52:54]
Share your thoughts on this story
|
News
Fifty years ago, they were screwed-up kids sent to the Florida School for Boys to be straightened out. But now they are screwed-up men, scarred by the whippings they endured. Read the story and see a video and portrait gallery.
Print
Email story
Comment
Email editor
