Q. I am retiring Aug. 30 and would like to pay my home off at this time. I have $107,000 in my account and the payoff for my home would be roughly $49,000. I plan to let the remaining balance stay there until 62 and receive monthly payments. My retirement is listed under FERS and, at 62, I will get Social Security (I have worked in the private sector for more than 30 years and expect my retirement pay to be nothing less than $1,000 a month, for a total income of at least $2,600 a month. Does this seem like a bad move if I pull out $49,000?
A. The question is how this move will fit into an overall planning and management scheme, and whether there are other options that are likely to produce better results, within the context of that scheme, than the withdrawal and payoff. The terms of your current mortgage are critical to framing the decision for analysis.