In 2020 according to Zillow, 37% of Americans own their homes free and clear. The number went up by 5.5% after the great recession. In 2017 41% of baby boomers owned their homes free and clear. For seventy-year-olds, an estimated 68% are mortgage-free, in 2022 that number grew to 70%.
I have read tons of advice over the years that suggests paying off a mortgage isn’t a good idea. It makes sense that if paying off a mortgage means using up savings and retirement accounts it probably isn’t a good idea. Other debts should be paid off first, especially credit card debt.
Owning a home free and clear means lower housing costs during retirement. Those property taxes are killer but still lower than renting or paying taxes and making mortgage payments.
It might even be possible to retire without having saved up a million dollars by owning a modest home that is paid for and no debt.
There are some psychological benefits of not having to make house payments. It can be liberating. Something to consider when planning for retirement.
