Seniors and the Mortgage

Should a senior citizen think about paying off the mortgage? With the recent financial crisis throwing the seniors' retirement plans all awry, most seniors are in shell shock and completely unsure of what to do.

The majority have almost nothing left of their monthly pensions because of budget slashes and rising prices. Home values are spiraling downward and any stock investments are probably worth nil. There is nothing to do to change the current picture except make wise investments with what is left.

Do you think of your mortgage as an investment? It is, in two ways. First, you are paying for an asset, your home. Second, the faster you pay off your mortgage, the more you can earn on the mortgage interest rates.

Don't forget the returns that you earn on when you pay. Interest payments on your investments allow you to deduct them come tax time, earning you a sure investment with every payment you make.

Mortgages are essentially considered "safe risks" so when the interest rates on other safe risks are lower on the returns of comparable investments like insured deposits and government securities, you are better off repaying your mortgage.

These risks are affected by many factors, not the least among them the age of the borrower. If higher risk investments are showing themselves to be more profitable at a steady rate, then it's time to call it quits with your mortgage.

It's best not to take too many risks when the senior in question is of an advanced age. While high-risk investments follow the normal ebb and flow of the stock market and average out after time, this is not a feasible option for any senior. It's best to invest in the safe stocks and instruments, going for the blue-chips more than looking for a quick buck.