If you follow the advice of traditionalists, you are guaranteed to pay taxes and have mortgage payments for life.

Don’t believe me?

If you follow traditional advice, this is what you’ll get…

If you rely on 30-year mortgages to finance your home, and you make the minimum payment because it’s ‘cheap’ money and a mortgage is a good tax write-off, here’s what you get.

  • You get only one mortgage by the time you’re 35 years old IF you want to be mortgage free by 65.  Mortgages and expected retirement date go hand-in-hand.
  • If you move, refinance or chase interest rates and equity during your adult life, you’re virtually guaranteed to pass with a pending mortgage payment.
  • Tax advantage? For every $10 in interest paid, you’ll lose $7 to save $3…give or take depending on your tax bracket. Where’s the wisdom?
  • You will pay more in interest over your life time than you will invest or earn in your 401k.  The amount you borrow will outpace the amount you invest.
  • You can borrow and pay interest on $500,000 with the stroke of a pen. It takes a life time and consistent favorable returns to save $500,000 for retirement.

If you are ‘planning’ to be mortgage free in retirement, but you don’t have a strategy to execute that plan, then you won’t be mortgage free.
A plan without a strategy is just a dream of being mortgage free. Visit My Calendar to schedule a conversation. You can tell me your plans and I can show you the strategy.

If a 401k is your sole vehicle for retirement, here’s what your future looks like…

  • A vague, unknown idea of what you will have when you ‘plan’ to retire.
  • A speculative investment, with no floor, no net, and you take 100% of the risk.  Sounds like Vegas to me.
  • You get to pay taxes on your money, which is expected since you haven’t yet paid tax on that money.  The question is, what will your tax rate be 25–40 years from now?
  • You get to pay taxes on all gains.  Interest earned is taxed.
  • AND you get to pay taxes on your employer’s match.  That’s right. They got a tax write-off, you get to pay the tax.
  • If you don’t out live your 401k, you will pay taxes until the day you die.
  • If you out live your 401k, there’s a good chance you will still have a mortgage payment. Now what?

Please correct me if I’m wrong on any of this!  Ask your trusted mortgage broker, banker and financial advisor if any of this is reality.  If they dispute any of it, you might consider finding a new ‘expert’ to advise you. Or get them on the phone with me and we’ll duke it out. You would enjoy that I pormise.

Oh yea, got kids? Will you be helping them with college?  Is that in the plan?  Will you be buying them cars? How many cars will you have to purchase for yourself during retirement? EV or gas?  The average monthly pament for a used car in 2023 is $538.  What might that be in 2043?  Do you have a plan and a strategy for any of this real life stuff while you’re funding retirement AND paying off your mortgage AND live comfortably before and during retirement?

At retirement, you should only be responsible for property taxes, homeowners insurance, basic needs and fun. Is this what your plan looks like, or does your plan look as bad as a traditionalist?