Experts Urge 60-Year-Old Borrowers to Keep 3-5 Years of Cash Before Clearing Home Loans
Updated
Updated · Mint · Sep 27
Experts Urge 60-Year-Old Borrowers to Keep 3-5 Years of Cash Before Clearing Home Loans
2 articles · Updated · Mint · Sep 27
Summary
Borrowers nearing age 60 should not drain retirement savings to wipe out a home loan unless enough corpus remains for living costs, healthcare and emergencies, experts said.
The trade-off is close: home loans often cost 7%-9% interest while retirement savings may earn 7%-8%, making full repayment sensible only when post-retirement cash flow stays secure.
Experts said self-occupied homes may justify faster repayment to remove a large EMI, while investment properties can keep the loan if rent covers instalments and the area is appreciating.
Part-prepayment emerged as the middle path, with advisers urging retirees to review outstanding principal, tenure, loan rate and monthly needs and keep at least 3-5 years of expenses liquid.
The broader message is that peace of mind from becoming debt-free should not come at the cost of long-term financial stability, and borrowers should seek professional advice before deciding.