via The Globe and Mail | September 4, 2015
Should this couple dig away at mortgage debt or grow their RRSPs?
Since their June wedding, Jen and Jay have been consolidating their finances with a view to paying off their mortgage as quickly as possible and retiring in a few years. She is 57, and he will be 60 this fall.
Both have senior positions, Jay in management, Jen in education. Together they bring in $260,240 year. They have three grown children.
Jay lives in a rented apartment in a city in Ontario, where he works. Together, they own a house in a nearby town, where Jen lives and works.
“Is it better to pay down the mortgage as fast as possible, or continue to contribute to RRSPs and make extra mortgage payments as we can?” Jay asks in an e-mail. They have a $246,200 mortgage at 2.09 per cent on their $500,000 home. They plan to travel after they have quit working and have a retirement income goal of $80,000 a year after tax.
“Will we be able to retire in two or three years?” Jay asks.
We asked Matthew Ardrey, vice-president of T.E. Wealth in Toronto, to look at Jay and Jen’s situation. T.E. is a fee-only financial planning firm.