In 2015, 10% of retirees owed over $100,000 in retirement, 60% had no debts or debts under $5,000.
With the increasing number of individuals over age 65, we can expect to see increases in the cost of some services purchased in retirement. For example, we’re already seeing a rising cost for elderly extended care due to government cutbacks and increased demand for available seniors' accommodation. To protect against this, we need to continue building assets as a reserve for such events. Carrying debt seriously reduces our ability to do this.
Living beyond your current income, serviced by debt, is a serious impediment in retirement. Eliminating and avoiding debt in retirement is a safe and worthy objective. It’s hard to use the family home to fund your nursing home fees if it’s already mortgaged to the hilt.