Mortgages & retirement - what should you think about?

We always talk about tailoring your mortgage to fit your current and future needs. But people often don't really understand what that means until they hit a major life change. One of the big ones is retirement. There are many things to consider when you are nearing this life stage and now more than ever many people are retiring with mortgages, especially in the GTA where homes are higher in price.

Here are some questions I would ask you when we are looking at your mortgage BEFORE you retire....

- do you plan to stay in the home? Can you grow old in it? or will you want to downsize in the future? If so, we might want to consider a large line of credit to allow you to do this more flexibly when you find the right place while it is still easy for your to qualify on your income

- Will you need to buy a car? Often financing for seniors can be difficult for a vehicle so you may want to pull the necessary funds you will need for this purchase out of your equity

- DO you know what your cash flow will look like in retirement? If you are unsure what exactly you will be earning from pension income then we might want to consider stretching your amortization to make your minimum payments lower until you get adjusted to your new retirement cash flow.

These are questions that you don't need to think about when you are not expecting a huge change in income & lifestyle but they are important to consider as you near retirement. If you have questions or would like to chat through them please give us a call.