•   
  •   
  •   

Money Kevin O'Leary: This is the age when you should have your mortgage paid off

07:06  14 june  2018
07:06  14 june  2018 Source:   cnbc.com

Sharing your husband’s debt might be unwise

  Sharing your husband’s debt might be unwise Sharing your husband’s debt might be unwiseQ: My husband and I still owe $44,000 in student debt between the two of us. We each have our own credit card, and I pay mine off in full every month while he owes $16,000 on his. We own our home together and have maybe $85,000 in equity today. My husband wants to use that equity to pay off our student loans and his credit card debt. I’m not sure that’s a good idea.

Kevin O ' Leary : This is the age when you should have your mortgage paid off . If you 're one of those millions of people with a mortgage , your top priority should be paying it off before retirement, according to Kevin O ' Leary .

Kevin O ' Leary : Here's the age by which you should have your debt paid off . If you 're one of those millions of people with a mortgage , your top priority should be paying it off before retirement, according to Kevin O ' Leary .

Americans hold $8.88 trillion of mortgage debt, according to a February report from the Federal Reserve Bank of New York. It's the largest type of household debt in the country, and it increased "substantially" during the fourth quarter of 2017 — up $139 billion, according to the report.

If you're one of those millions of people with a mortgage, your top priority should be paying it off before retirement, according to Kevin O'Leary.

Why I'm in no rush to pay off my mortgage

  Why I'm in no rush to pay off my mortgage This man is more than comfortable with his home payments.Actually, no. As the title suggests, I’m in no rush to pay off the mortgage on my condo I bought in 2014. It has nothing to do with not having enough money to pay my condo off. Between my business and investments, I could — if I wanted to. However, I’m choosing to keep paying my mortgage and invest the rest.

Kevin O ' Leary : Here's the age by which you should have your debt paid off . If you 're one of those millions of people with a mortgage , your top priority should be paying it off before retirement, according to Kevin O ' Leary .

Kevin O ' Leary : Here's the age by which you should have your debt paid off . If you 're one of those millions of people with a mortgage , your top priority should be paying it off before retirement, according to Kevin O ' Leary .

"If you want to find financial freedom, you need to retire all debt — and yes that includes your mortgage," the personal finance author and co-host of ABC's "Shark Tank" tells CNBC Make It.

You should aim to have everything paid off, from student loans to credit card debt, by age 45, O'Leary says.

"The reason I say 45 is the turning point, or in your 40s, is because think about a career: Most careers start in early 20s and end in the mid-60s," O'Leary says. "So, when you're 45 years old, the game is more than half over, and you better be out of debt, because you're going to use the rest of the innings in that game to accrue capital."

Kevin O'Leary wearing a suit and tie © Provided by CNBC

Americans are increasingly likely to retire with debt, according to a 2018 study in the American Economic Association Papers and Proceedings. More than 70 percent of Americans between the age of 56 and 61 were in debt in 2010, according to the study. That number is up 64 percent from 1992.

Doug Ford's next challenge is to make sense of his many nonsensical promises: Robyn Urback

  Doug Ford's next challenge is to make sense of his many nonsensical promises: Robyn Urback Doug Ford will realize very quickly that making a bunch of conflicting, unrestrained promises is a lot more fun than actually running a government. And after the first few months of playing defence in the legislature, to the media and to critics from within the party, it might not feel so good.That should be obvious to anyone who has made a career out of public service — or even to anyone who regularly observes its inner workings. Ford, however, does not appear to be one of those people, at least when it comes to Queen's Park.

Kevin O ' Leary : Here's the age by which you should have your debt paid off . If you 're one of those millions of people with a mortgage , your top priority should be paying it off before retirement, according to Kevin O ' Leary .

Kevin O ' Leary : Here's the age when you should have your debt paid off . To do that, contribute an extra 20 percent to your monthly mortgage payment , even if it means sacrificing elsewhere in your budget.

But unlike other types of debt (like big credit card bills), taking out a mortgage on a home that appreciates in value can be a smart decision. In 2017, homeowners with a mortgage saw the equity in their home increase in value by an average of $15,000 according to CoreLogic.

"Mortgages are more of a gray area than credit card debt, because real estate can be an investment," O'Leary explains. Still, he advises you to think long and hard before taking on a mortgage at all.

"It's not always a good investment, and in my opinion, most people in their 20s, or even 30s, have no reason to be taking on that kind of debt," he says. "Homes don't always gain as much value as you expect — at least not anymore, and at least not quickly."

Indeed, with interest rates on the rise, borrowing money is becoming more expensive. For the week of June 7, the 30-year mortgage rate was 4.54 percent, according to Freddie Mac.

If you do decide to take on debt to buy a home, O'Leary's advice is simple: Get it paid off as soon as you can. If you already hold a mortgage on your home, O'Leary argues paying it off should take a higher financial priority than using extra cash to invest in things like stocks or bonds.

Kevin O'Leary turns bullish on Canada but dodges questions about another political bid to sink Trudeau

  Kevin O'Leary turns bullish on Canada but dodges questions about another political bid to sink Trudeau The O'Shares chairman says he's making a two-pronged bet on Canada's future prosperity on what he sees as a conservative groundswell."I'm waving the Canadian flag. I'm going long the [Canadian] dollar and I'm going long 60 large-cap Canadian companies," said O'Leary, who was born in Montreal in Canada's Quebec province.

Kevin O ' Leary : Here's the age by which you should have your debt paid off . If you 're one of those millions of people with a mortgage , your top priority should be paying it off before retirement, according to Kevin O ' Leary .

"Shark Tank" star Kevin O ' Leary explains the age at which you should have your mortgage paid off and why.

"There's never an incentive to stay in debt," O'Leary says. "Life is unpredictable. What happens if you're laid off or incur unexpected expenses elsewhere? Your once-manageable mortgage is suddenly going to seem not-so-manageable."

Personal finance expert Suze Orman agrees. If you plan to stay in your home through your golden years, you should get your mortgage paid off before you retire.

"You should be grabbing every opportunity you can to eliminate the known risks in your retirement plan," Orman writes in Money. "If you know you want to stay in your home, paying off the mortgage is a great way to build security."

Self-made millionaire and wealth management expert David Bach even says paying off your mortgage as quickly as possible is a step toward retiring early.

"I can tell you, having been a financial advisor at Morgan Stanley, my clients who retired at 50 years old, the secret was: They had paid their mortgage off early," Bach tells CNBC Make It. With a 30-year mortgage, make a plan to pay it off in 20, or preferably 15 years, he says. To do that, contribute an extra 20 percent to your monthly mortgage pay by scrimping and saving elsewhere.

Mortgage borrowing among Canada's millennials sees major pullback

  Mortgage borrowing among Canada's millennials sees major pullback Mortgage borrowing among Canada's millennials sees major pullbackThere's been a steep drop-off in the volume of mortgages that Canada's millennials are taking out, a sign that the country's faltering housing market could see more weakness ahead.

Kevin O ' Leary : Here's the age when you should have your debt paid off . To do that, contribute an extra 20 percent to your monthly mortgage payment , even if it means sacrificing elsewhere in your budget.

When should you aim to have it all paid off ? Age 45, O ' Leary says. "The reason I say 45 is the turning point, or in your 40s, is because think about a career: Most careers start in early 20s and end in the mid-60s," O ' Leary says.

But, other experts see the issue differently. There are drawbacks to prioritizing mortgage payments over potentially lucrative investments in things like stocks or bonds. Also, there are varying tax implications.

So before you decide to pay off your mortgage early, consider a few questions to pinpoint your financial goals: Where will your money earn the greatest return? What level of risk are you willing to take? How much access to your money do you need? Then, make the best decision for you.

If you ask O'Leary, the decision simple: "Debt is evil."

Don't miss: Kevin O'Leary: Unless you can pass this two-question test, don't buy a home

Like this story? Subscribe to CNBC Make It on YouTube!

Kevin O'Leary: 'Never' rely on a joint bank account — even if you're married .
"Shark Tank" investor and personal finance author Kevin O'Leary says that even married couples shouldn't only have joint checking accounts and credit cards. Here's why you need your own financial identity.That's according to a star of ABC's "Shark Tank" and personal finance author Kevin O'Leary, who tells CNBC Make It that something as simple as a joint checking account with a romantic partner — even a husband or wife — can have long term consequences.

—   Share news in the SOC. Networks

Topical videos:

This is interesting!