re: What to do with $250K

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Does that include some heavy loan payments or something? Seems like a lot of expenses for a retired couple.

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The annual $67K breaks down to about $5,600/mo. I would be debt free if I paid off the house.

The biggest items are a 0% interest on a car note of $500, health related: insurance/medication/Drs/long term health ins $1,700, utilities $500 and groceries/eating out $1,000 and $400 in contributions. That’s $4,100 of it right there.

I never said I had a tight budget. What seems like a comfortable budget seems like it would have a lot of cushion if I freed up an extra $1,500 by paying off the house.

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Everything is paid off except a mortgage that is just under 4%. I owe $190K on the House and my monthly note is $1,498.

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The mortgage has 20 years remaining on it so it’s not like I’ll pay it off any time soon.

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I refinanced several years back and now have 25 years remaining on the mortgage. In other words, I’ll never pay it off.

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So do you have 20 years to remaining on the mortgage or 25 years?

Either way, with a < 4% rate, the mortgage payments should be well less than $1498.00 per month, at least $350.00 less per month.

So unless you're using your monthly escrow (e.g., PMI which can likely be dropped if you have it; homeowner's insurance which you'll have to pay anyways; and/or property taxes which you'll have to pay anyways), the figures don't add up.

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The biggest items are a 0% interest on a car note of $500, health related: insurance/medication/Drs/long term health ins $1,700, utilities $500 and groceries/eating out $1,000 and $400 in contributions. That’s $4,100 of it right there.

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That's a pretty high debt load for a retiree, in my opinion. I'm curious how much more time you have on that vehicle. That plus $400/mo on "contributions", is that for your pension and would go away at retirement?

I would consider paying off the mortgage in a 5-10 year time frame while keeping a larger portion of the property gains invested. You could throw $30-50k down at the time of sale to move further down the amortization schedule and pay extra every month or year to meet the 5-10 year schedule. This plan gives you a little time to get accustomed to your new retirement spending lifestyle. I also would probably work another year or two to pay off the vehicle and drive it until the wheels fall off. That $500/mo would piss me off.

I’m going to sound like a sales person, but so be it...
There are alternatives besides CDs, Annuities, and Bonds.
Mainly it is with alternative Asset Backed Lending strategies, Real Estate Funds that are secured by collateral or life settlements .
It can be used for cash flow/income or for growth or appreciation.
This is also very low risk. It’s not risk free, but it has less risk than Wall Street with passive investments.
I do this for a living so I won’t pitch you anymore. Hope you get good info.???

A paid-for house is worth it's weight in gold.

Having a roof over your head with only have to pay for utilities and taxes is serious peace of mind.

Just my opinion.

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They run a diversified debt fund that pays a fixed interest rate to people that lend money to them. It is a cash flow model.

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Be sure to ask for Mr Madoff when you call.

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$85k annual in COL expenses Agreed...that number seems very high for someone in retirement. It should be closer to half that for 2 people.

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Okay, I’ll lay out our high expenditure retirement budget that comes out to $85K annually with an income of $102

$1,498 mortgage (25 more years)
$825 Grocery Store
$600 Health Insurance
$489 Car note (0% interest paid off in 18 more months)
$350 Personal/Entertainment
$300 Utilities
$300 Resturants
$300 Gasolne
$300 Drs
$350 Prescriptions
$350 Donations
$250 Phone/Direct TV/Internet bundle
$200 Clothes
$277 Vehicle Insurance
$187 Lng term Health Insurance

I also have budgeted $600/month to go to savings for things like season tickets, small trips. There’s another $400 that goes for small things like yard, haircuts etc

So, I have $600 extra for savings now. By paying off the mortgage I would just have more for trips and unexpected expenses. Also, I’m looking at that cushion to slowly be consumed by cost of living increases.

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Agreed...that number seems very high for someone in retirement. It should be closer to half that for 2 people.

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How could two people retire and do anything on 45K a year even in a low cost of living area with a paid for house, might as well keep working there would be no point in retiring? I know tons of retired people in there 60s, 70s, 80s, and none of them are sitting home watching wheel of fortune, people are staying healthy longer and doing more.