Lately my mind has been filled with thoughts of Christmas and retirement. I'm not sure of the connection, but perhaps both are luxuries that are no longer so affordable, or it's because we are now starting up a new mortgage loan following a refinance.
I've been toying with the idea of simulating living on retirement income. We have already done so for some years given our plan was to pay down the mortgage by retirement, but now I'm leaning towards putting the mortgage prepayments in our 401(k)s as extra.
The interest rate gap between the mortgage and those retirements accounts is now significant. There is furthermore little point in working your hardest on removing the tax deduction that the mortgage provides, especially when you can maximize both in one shot.
A feel for how the whole thing works helps. If we have a remainder on the mortgage loan at the time the first of us retires, can we afford stuff like Christmas? But that's exactly what we're testing ahead of time. The mortgage will provide some tax relief even then.
Displine is required at that time of course. I'd like to let especially social security mature until she retires. And have the mortgage paid by then. And afford Christmas. And use the credit cards all at the same time! So we'll see how it goes.
That thought is my Christmas present to myself. Didn't cost us anything.