Thank you all for the comments, they echo my exact concerns. To add briefly, my partner and I are going our separate ways. We did not have kids. I purchased the house when the rates went over 5% a few years back, mostly out of fear.
It's a 2200 SF home, 500k mortgage with 3% down, so equity is negligible - monthly payment is around 4k/mo., with about $1100 in property tax/insurance/PMI. To rent an equivalent home, it would cost around 3k/mo. in the neighborhood. Apartments would cost 2k+ range.
Selling the house wouldn't be difficult, as it's in a desirable neighborhood with a good school district/hospitals/amenities. But once the house is sold, along with the retirement, it would be hard to get back in is my fear.
Thank you Watty, for sharing your previous post. This was very encouraging. My rationale was exactly as stated - that I'm trading the pension for the house, is this reasonable?
It appeared to me, that this is a nearly zero risk trade with a slight advantage in my favor due to the fixed rate mortgage against the COLA based pension.
I agree with the concerns that 2.5k monthly remainder may be a bit tight to cover the remaining basic necessities, such as the monthly utilities, auto expenses including insurance and food.
I had earmarked the 750k as discretionary and Social Security to help offset the longevity risk for the basic necessities.
My SS PIA is about 3100/mo. in today's dollars with zero earnings set beginning in 2025, and opensocialsecurity recommends taking the benefits at 65, which is unusual as my full retirement age is 67.
65 would be about the halfway mark for the mortgage. My life expectancy is statistically less than 30 years. My mortgage has a better chance to outlive me. I guess I'd better be sure to really like this house.
It's a 2200 SF home, 500k mortgage with 3% down, so equity is negligible - monthly payment is around 4k/mo., with about $1100 in property tax/insurance/PMI. To rent an equivalent home, it would cost around 3k/mo. in the neighborhood. Apartments would cost 2k+ range.
Selling the house wouldn't be difficult, as it's in a desirable neighborhood with a good school district/hospitals/amenities. But once the house is sold, along with the retirement, it would be hard to get back in is my fear.
Thank you Watty, for sharing your previous post. This was very encouraging. My rationale was exactly as stated - that I'm trading the pension for the house, is this reasonable?
It appeared to me, that this is a nearly zero risk trade with a slight advantage in my favor due to the fixed rate mortgage against the COLA based pension.
I agree with the concerns that 2.5k monthly remainder may be a bit tight to cover the remaining basic necessities, such as the monthly utilities, auto expenses including insurance and food.
I had earmarked the 750k as discretionary and Social Security to help offset the longevity risk for the basic necessities.
My SS PIA is about 3100/mo. in today's dollars with zero earnings set beginning in 2025, and opensocialsecurity recommends taking the benefits at 65, which is unusual as my full retirement age is 67.
65 would be about the halfway mark for the mortgage. My life expectancy is statistically less than 30 years. My mortgage has a better chance to outlive me. I guess I'd better be sure to really like this house.
Statistics: Posted by lzq — Wed Feb 28, 2024 3:04 am — Replies 10 — Views 1437