How Much Am I Losing By Not Carrying A Mortgage in Retirement
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Optimize Your Retirement - How Much Money Am I Losing By Not Carrying A Mortgage In Retirement
1$9,084$727
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2$18,895$1,512
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AssumptionsInputsExplanation3$29,491$2,359
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Current Equity In Home $ 500,000 4$40,934$3,275
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Current Home Value $ 500,000 5$53,293$4,263
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Cash-out Amount $ 400,000
Great! This amount is below the maximum of 80% of your home value.
6$66,640$5,331
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Refinance Rate4%Interest Rate7$81,055$6,484
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Refinance Term in Years30Loan Term8$96,624$7,730
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Expected Portfolio Return8%
Percentage return expected on your portfolio
9$113,438$9,075
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10$131,597$10,528
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CalculationsOutputs11$151,209$12,097
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Refinance Monthly Payment $ 1,910
Monthly new mortgage payment - principal and interest
0.011044993382.31349801512$172,389$13,791
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Refinance Annualized Payment $ 22,916
Annual new mortgage payment - principal and interest
13$195,265$15,621
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Annual Income If Invested $ 32,000
Assumes you invested the entire refinanced amount at the expected portfolio return
14$219,970$17,598
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Amount Lost Annually If Not Refinanced
$ 9,084
Assumes you pay the mortgage with investment income
15$246,652$19,732
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Amount Lost Over 30 Years $ 1,029,072
Assumes you keep investing the annual amount in cell B15 and earn the rate in cell B9
16$275,468$22,037
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17$306,589$24,527
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Resources18$340,200$27,216
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Personal CapitalThe first step in securing your financial future is to sign up with Personal Capital. It's a completely free tool that I recommend to everyone.19$376,501$30,120
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LendingTreeI believe that retirees SHOULD carry a mortgage in retirement to optimize their finances. Make banks compete for your business so that you can get the best rate. 20$415,705$33,256
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21$458,045$36,644
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22$503,773$40,302
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For more information, you can email me at matt@optimizeyourretirement.com or see the associated post: 23$553,159$44,253
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24$606,495$48,520
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http://optimizeyourretirement.com/carrying-a-mortgage-in-retirement
25$664,099$53,128
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26$726,311$58,105
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27$793,500$63,480
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28$866,064$69,285
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29$944,433$75,555
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30$1,029,072$82,326
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Mortgage Opportunity Cost