assurance

I want to know if I should pay my first and second mortgages by selling stocks. One-third of my retirement funds go toward mortgages alone, and if I add up all the expenses, almost two-thirds are spent. I am now 70 and was thinking of starting to withdraw from my IRA at 73. Should I wait or touch it now?

Paying off both mortgages would put us in the 22% tax bracket and ultimately increase our Medicare premium.

See: I’m 71 and can’t decide whether to pay off my mortgage or get a cheaper joint annuity. What should I do ?

Do you have a question about your own retirement savings? Email us at HelpMeRetire@CNET.com

Dear reader,

You do not have to pay off your mortgage by selling your shares. There are several ways to do this.

One mortgage, let alone two, can be very anxiety-inducing for retirees, as many are on a fixed income and have a limited amount of money for the future. You don’t want to deplete your savings too quickly because you’ll need them for your entire life, but you also don’t want to have this huge debt hanging over your head.

Your IRA and stocks total $1.4 million. It’s fantastic. This can certainly be a source for you to pay off your mortgages, but before you do, ask yourself what the purpose of this money is. Your retirement income currently seems to cover necessities just fine, but at some point, do you plan to rely on that money for retirement, such as health care, long-term care, etc. ?

And even beyond that, will that money be more useful when one spouse dies, since some of your current retirement income (like Social Security benefits) will disappear.

Before you make a decision, do a financial “check-up” of your cash inflows and outflows, your expected retirement expenses now and in 5, 10, 15 or more years, and what that means for your nest egg. Make sure you have an emergency savings account outside of your IRA, stocks, and the account you use to pay your bills, perhaps worth a year or more of your annual expenses.

Back to mortgages. Two popular methods of debt management include the “snowball” and “avalanche” strategies. With the snowball strategy, the goal is to pay off small debts first, then move on to larger ones. In this case, it would mean tackling your primary mortgage completely, then your secondary mortgage. With the avalanche strategy, you would do the opposite: secondary first, followed by primary. In either case, you would pay the minimum payments for each, but then spend additional money on one or the other.

Some people would probably take the avalanche method in your case, because you have an 8% interest rate on your $160,000 mortgage, while others would be happier with the snowball approach, since this debt would be crushed more quickly. Be sure to tell your mortgage lenders that any extra payments you make should go directly toward principal, which will reduce the balance more quickly.

Also see: We have $3 million in real estate, which brings in $70,000 a year. Can I earn the same income investing in stocks and bonds?

Since you faire having extra money each month from Social Security and pensions is a viable option. It would take a little time, but it allows your retirement assets to continue to grow and avoid big tax bills.

If this plan is too slow for you, which is understandable, you can mix up your investments. A large withdrawal will absolutely put you in a higher tax bracket and potentially affect your Medicare, as you know, but you can try a smaller withdrawal that will just help you pay off the mortgages faster.

Consult a qualified and trustworthy certified financial planner or certified public accountant who can help you do the math. A professional can offer you some ideas to consider and determine the best tax-efficient and reasonable ways to pay off your mortgage while still living your life.

It’s essential to look at the big picture when considering withdrawing part of your retirement assets. If you can pay your mortgage and still have food on the table, lights and heat on in the house, and a little extra cushion to feel comfortable, having a mortgage in retirement doesn’t matter. isn’t the worst thing in the world.

But you have two, what if you could narrow it down to one and eliminate it completely sans If it hurts your future financial health, you’ll feel on top of the world.

Readers: Do you have any suggestions for this reader? Add them in the comments below.

Do you have a question about your own retirement savings? Send us an email at HelpMeRetire@Crumpe.com