Home News 5 ways to avoid retirement debt

5 ways to avoid retirement debt

Font size :
A debt-free retirement ensures that you have enough funds to live on after employment. Whilst this is something most people are working towards, analysis from the Australian Centre for Financial Studies reveals that some retirees allocate up to 40 per cent of their retirement pay to their mortgage. Some 15 per cent of retirees are still renting property, while around eight per cent are still paying their home loans.
Follow these tips to ensure you are on your way to enjoying a debt-free retirement:
  1. Do the math.
Calculate your mortgage payment and add a little extra – as much as you can afford. Even if it’s only $20 extra per week, if you can stand by this, your home loan will be paid off well before retirement.  Also, pay off your debts with the highest interest rate as a priority.
  1. Bargain for the best deal.
Make a point to renegotiate your interest rates regularly; you never know what discount you can get just by asking. Now is also a good time to pay extra to offset the capital of your home loan with today’s lower interest rates.
  1. Pay the principal, too.
Your home loan can be must more quickly paid off when you also pay the principal along with the interest repayments on your mortgage. Be strategic about it, however – for instance, do not use cash advances from credit cards, which carry higher rates, just to pay off your home loans.
  1. Consider a smaller home.
Downsizing your house can considerably lower your home loan and help you achieve a debt-free retirement. It will also take longer to pay off debt when you refinance, so try to avoid taking on additional debt.
  1. Work a little longer.
While the idea of retirement is very appealing, extending your working years beyond the retirement age also means you’ll have additional income to pay off the mortgage, and also add to your savings.

With interest rates at their lowest for more than 50 years, there are some great rates available. The best thing to do is to compare rates from all the lenders. Let us help take the leg work out of doing this - Compare Home Loans now

Mortgage News and Articles

New social housing aims to transform Ivanhoe Estate New social housing aims to transform Ivanhoe Estate

The sprawling redevelopment aims to boost the supply of affordable housing in Sydney Read more

A new suburb will be built in west Melbourne A new suburb will be built in west Melbourne Mount Atkinson will become home to more than 22,000 people over the next 15 years ... Read more

Surging house prices threaten liveability in Melbourne Surging house prices threaten liveability in Melbourne Analysts warn the city could become just as unaffordable as Sydney, if property trends continue ... Read more

More Aussies would benefit from regional hubs linked to cities More Aussies would benefit from regional hubs linked to cities Shorter commutes could spur higher home sales in regional towns, analysts say ... Read more

More mortgage news and articles

Sponsored Links

Friday, Aug 18, 2017
Top Featured Rates
Top Bank Rates

Get help choosing the right home loan

Let us help you find the right home loan for your needs.

Tell us a bit about your circumstances:
  • Purpose of mortgage
  • Household Income
    $
  • How much do you want to borrow?
    $
  • How much deposit do you have?
    $
  • How much is your house worth?
    $
  • How much do you still owe on your mortgage?
    $
  • What type of mortgage do you have?


  • How much is your new home?
    $
  • How much do you want to borrow?
    $
  • How soon do you want a mortgage?
Next
  • First name
  • Last name
  • Where do you live?
  • Phone number

Special Offers

Related Keywords