I have been asked this question a lot lately as I help my clients plan for their retirement. Here are a few questions I ask to determine if you should pay off your mortgage before retiring.

Do you still get a tax deduction for the interest you are paying?
If you can still deduct interest, I think that is a good thing. Any deductions that help reduce your Federal Income Tax works in your favor.

What is your interest rate?
If you have a mortgage with a 3 or 4% rate, in my book that is a cheap loan, why rush to pay it off when you can potentially earn more through investments.

Will paying off your mortgage cut into your emergency fund?
Having good cash reserves, especially in retirement, are important. If paying off your mortgage will leave you cash poor, rethink that decision.

One tip to pay down your mortgage faster is to make bi-monthly payments. You can potentially cut ten years off the life of the mortgage.

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