Mortgage Free...what's the point?
KarenSFalconer
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Newbie
Hi
I'm new to this forum and I joined because we have a conundrum...If everything goes according to plan, we should be able to pay off the mortgage next year, when it comes out of the fixed rate and I hit 60 (better late than never).
However, our only 'pension' is a couple of buy to let properties, which are getting slammed by governments hitting landlords. Having always been self employed and made sure everyone else was taken care of, we don't have a lot else...our meagre pension plans were cashed in to support us/the business/the kids during the pandemic.
...so not much of a long term plan!
At the same time, I am helping my aunt sell her home because she needs the funds to facilitate long term care (she is 94 and has dementia)...and in a few years I suspect I'll be doing the same for my mum, who is 86! All their savings, investments and hard earned money will end up paying for their long term care.
So, what if we end up in the same boat - having scrimped and saved to pay off the mortgage, we find ourselves having to sell the house one day to pay for care...and in the meantime, we've not had holidays or 'treats' and our kids still won't get any inheritance.
So, why do we want to pay off our mortgage? What if we sold the house, enjoyed the next 15-20 years without having to work and save...and then have nothing left for long term care, so the state would have to pay? Or what if we sell the house, give the money to the kids now then rent until we can no longer afford it...
It feels wrong to do that...but it also feels really unfair to work really hard all our lives and still end up with nothing to show for it at the end of the day. The whole system feels unfair really!
I just find myself questioning whether paying off the mortgage is the right thing to do? I can see there is a lot of wisdom on this forum, so I'd appreciate any guidance, advice, feedback please.
I'm new to this forum and I joined because we have a conundrum...If everything goes according to plan, we should be able to pay off the mortgage next year, when it comes out of the fixed rate and I hit 60 (better late than never).
However, our only 'pension' is a couple of buy to let properties, which are getting slammed by governments hitting landlords. Having always been self employed and made sure everyone else was taken care of, we don't have a lot else...our meagre pension plans were cashed in to support us/the business/the kids during the pandemic.
...so not much of a long term plan!
At the same time, I am helping my aunt sell her home because she needs the funds to facilitate long term care (she is 94 and has dementia)...and in a few years I suspect I'll be doing the same for my mum, who is 86! All their savings, investments and hard earned money will end up paying for their long term care.
So, what if we end up in the same boat - having scrimped and saved to pay off the mortgage, we find ourselves having to sell the house one day to pay for care...and in the meantime, we've not had holidays or 'treats' and our kids still won't get any inheritance.
So, why do we want to pay off our mortgage? What if we sold the house, enjoyed the next 15-20 years without having to work and save...and then have nothing left for long term care, so the state would have to pay? Or what if we sell the house, give the money to the kids now then rent until we can no longer afford it...
It feels wrong to do that...but it also feels really unfair to work really hard all our lives and still end up with nothing to show for it at the end of the day. The whole system feels unfair really!
I just find myself questioning whether paying off the mortgage is the right thing to do? I can see there is a lot of wisdom on this forum, so I'd appreciate any guidance, advice, feedback please.
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It's a great question - and I'm sure there will be people a lot wiser than I am who can offer their thoughts.
In the meantime, the only contribution from me is this: pretty much our whole lives are made up of conundrums and we rarely know for sure whether we've chosen the right path. For example: should our children/grandchildren go to university, accrue a lot of student debt and hope they get a well-paid job - or will they end up doing a job that doesn't need a degree, earning the same salary as someone who went straight from college, and yet still having that massive student loan to repay?
Another example might be: should people in their 20s/30s bother contributing towards their pension when they are still living at home and can't even afford a place of their own? To what value do they work out how to place one thing (the ability to live independently) over another (financial security 40 or 50 years down the road).
The bottom line is that, for most conundrums, there is no clear right or wrong answer. It is a degree of risk, or chance, which may or may not work out in your favour and you have to take advice if it's appropriate and then just jump in with your instincts.
Good luck!
Current MF date: Feb 2032. (Previously: Jan 2033)
Target MF date: May 2027
(Overpayments needed to achieve this: £1,750pm!)
Joint spend: £391.09 (Nov)
My parents didn't inherit anything of significant monetary value from their parents (lots of sentimental value on my dad's side like pictures and furniture, SFA on my mum's side) and made a good life for themselves. Likewise we don't expect to inherit anything either (we could be retired before that happens anyway!), but will be grateful if our parents' assets will pay for them to have a decent level of care should they need it. Two of my grandparents needed residential care, and were able to pay for places that were carefully chosen. Other relatives weren't so lucky, and the difference was significant.