What are your retirement goals? Do you want to be debt free with more wealth; travel more; enjoy your golden years stress-free in your fully paid-off home? To live comfortably in retirement, you can no longer rely solely on Social Security to survive and thrive. And company pension plans that pay a fixed income for life are virtually extinct. That’s why, no matter your current age, it’s critical to plan and start building a solid nest egg right now.
Find out where you stand and if you’re on a solid path to financial security in retirement. Do you have IRAs, 401(k)s or other assets to liquidate in retirement? If not, start now with skillful planning and investing. Your remaining years on the job are your last shot at socking away money in tax-advantaged retirement accounts and creating an emergency fund for unexpected expenses.
Many borrowers worry about their income dropping when they retire while their mortgage payment stays the same. But what if you had no mortgage payment at all? One of the best options just might be to pay off your home loan early, before you retire, then start saving the money that used to go to the mortgage. If you have enough years before retirement, you can do that by making biweekly mortgage payments.
Instead of sticking with the traditional monthly premium, making biweekly mortgage payments can pay off with increased savings and financial security in retirement. The biweekly mortgage plan also works well for other types of large debts, such as auto loans or large credit-card debts.
Here’s how it works: You make half of your monthly mortgage payment every other week. This means you make 13 payments each year instead of 12 (52 weeks divided by two equals 26 periods), but you’re paying just a little bit more with each biweekly payment. Withdrawals from your account every other week fit conveniently with paychecks and your monthly budget, while an extra half payment twice a year toward principal reduces interest over the life of the loan — visit our website for all the details.
If you have a 30-year mortgage for $272,000 at 4.5%, this one strategy alone can save you more than $37,000 over the course of the loan. Plus, you’ll retire your debt 53 months earlier using a biweekly mortgage payoff plan.
Use the AutoPayPlus loan calculator as a blueprint for determining how much extra money you need to apply to your debts with biweekly payments for the faster loan payoff you’re looking for. Experiment with various scenarios to see how biweekly mortgage payments can help you eliminate debt quicker, build wealth and achieve your goal of a golden, financially secure retirement.
Use biweekly mortgage payments to pay off your home loan sooner and save more for the retirement you’ve been dreaming of.