Don't let Housing Haunt your Retirement
Business Week Online, September 27th, 2006
Nowadays the old American dream of owning your own home outright can seem like just that: a dream. For reasons good and bad, Americans are increasingly carrying mortgage debt later in life. Retirees or soon-to-be retirees who haven't factored these mortgage payments into their retirement plans could need to come up with some extra income.
Meanwhile, the cooling housing market may be leaving many Americans with less home equity. Prices of existing houses fell in August for the first time in 11 years, the National Association of Realtors said on Sept. 25. Homebuilders like Beazer Homes, KB Home, and Lennar are also feeling the hurt.
About a quarter of US census respondents aged 70 and older reported having a mortgage in 2000, up from 19.9% in 1980. The number of census respondents in their 60s with a mortgage rose to 44.6% from 34% two decades earlier. This mounting debt load "may suggest that the traditional rules of thumb for determining appropriate levels of retirement income are outdated," according to a recent report by the Financial Planning Assn.
Read more of this article. Learn more about Reverse Mortgages. Learn more about Mortgage Refinancing. Learn more about Working in Retirement.