• Question
  • What to do with retirement money.

    Asked by someone from Los Angeles, CA on 1/28/2013

    I just retired at 66 years old.I am getting $2300 from SSS.my husband is getting $1600 from SSS .we still have $200000 mortgage,$1260 monthlypayment.my retirement savings from work $512,229.69.$356125 in 401k and 156064 in403b.no credit card debt and no car payment we are both in good health and we like to travel.Should we pay off our mortgage and where do you suggest to put my retirement savings,I probably need $2000 /month to live comfortably.

  • Categories: Your Life in Retirement, Retirement Planning, Budgeting, Mortgage Refinancing, Housing


  • Get a FREE 1-on-1 phone
    consultation with this advisor
  • This is a great question and one of the reasons I cover mortgages in retirement, in my Boomer Retirement Planning Class.

    If a person has the opportunity to pay off their mortgage before or shortly into retirement, then it is a good idea. If paying off a mortgage involves cashing in a significant amount pre-tax money, then I usually advise against it.

    In the case where it is not possible to pay off a mortgage prior to or shortly into retirement, or without cashing in a large amount of pre-tax money, then I advise my clients to consider looking into refinancing their mortgage. This can lower their payment and lock in today's very low interest rates.

    A lower mortgage payment means less money that has to be drawn out of their pre-tax retirement accounts. The other opportunity is to look at hybrid annuities that offer a living benefit -- an annuity that provides an income guarantee over two lives. Investing enough into the annuity to provide a level income to cover the mortgage for life, can make a lot of sense. That way the couple never has to worry about where the money is coming from to make their mortgage payment.

    With the rest of the money, depending on the risk, a couple should look at other annuities or investing in the market for their long term needs.

  • Login to rate this answer:   Answered on 1/28/2013
**All above answers are provided as general information only. No warranty is made regarding the fitness or accuracy of the information provided in this answer. You should seek advice from a licensed CPA, attorney or CERTIFIED FINANCIAL PLANNER™ as to your unique financial situation.