Be Smart About Your Investment in Real Estate

If you have always dreamed of a retired life full of beach side lazing, carefree holidays, and comfortable living, it is time to wake up. Retired people are finding that many of their post retirement plans will never see the light of day, unless they can miraculously raise enough money overnight to pay off huge liabilities like mortgages.

According to analysts, the high house prices that were seen before the sub prime crisis have increased the number of near retirees still saddled with debt. The Employee Benefit Research Institute reports that in 2007, almost half the breadwinners aged 55 or more were still paying off home mortgages. In 1992, the number was 25% lower.

Mortgages can be a big drain on your financial resources unless you take some concrete action right now when you are still getting your monthly paycheck. If your retirement age is nearing and you still have a lot of payments to make before you can finally shut the door on your home mortgage lender, then it is time to give some serious thought to planning your future.

Your home is probably your single largest investment. The majority of your savings get locked up in this investment and it eats into a significant chunk of your income month after month in the form of mortgage payments. It makes sense to pay off your mortgage before you retire so that you have fewer liabilities and more cash when you want to spend it.

However, the decision to prepay your mortgage must be tempered with a realistic analysis of immediate needs. There is no point in turning your children’s college fund into cash to pay off home loans because their education will still have to be financed. If your existing investments have some important goals like these or if your mortgage is giving you significant tax savings then prepayment may not be right for you.

In this case, refinancing your mortgage can help you out. Especially in the current financial climate when rates are at rock bottom levels. This may be the time for you to get guaranteed savings year on year with each mortgage payment by converting your 7% home loan to a 5% one.

Other options like lines of credit and home equity loans are also attractive in the present economy. In the worst case, you can always resort to reverse mortgages to draw on the investment made in the house.

Speak Your Mind

Home Bottom #1 Widget

This is a widgeted area which is called Home Bottom #1. It is using the Genesis - Featured Post widget to display what you see on the Enterprise child theme demo site. To get started, log into your WordPress dashboard, and then go to the Appearance > Widgets screen. There you can drag the Genesis - Featured Post widget into the Home Bottom #1 widget area on the right hand side. To get the image to display, simply upload an image through the media uploader on the edit post screen and publish your post. The Featured Post widget will know to display the post image as long as you select that option in the widget interface.

Home Bottom #2 Widget

This is a widgeted area which is called Home Bottom #2. It is using the Genesis - User Profile widget to display what you see on the Enterprise child theme demo site. To get started, log into your WordPress dashboard, and then go to the Appearance > Widgets screen. There you can drag the Genesis - User Profile widget into the Home Bottom #2 widget area on the right hand side.

Home Bottom #3 Widget

This is a widgeted area which is called Home Bottom #3. It is using a text widget to display what you see on the Enterprise child theme demo site. To get started, log into your WordPress dashboard, and then go to the Appearance > Widgets screen. There you can drag a text into the Home Bottom #3 widget area on the right hand side.