Don't you think it's easier to pay off that $100,000 that you owe rather than to have to save $400,000 just to generate the income needed to pay that amount off every month for 10 more years? Your mortgage, after all, was only $200,000 to begin with. Yet there are plenty of financial advisers and accountants who will say to you, "Oh, please … the money is cheap and you get a great tax write-off. Just keep doing it and don't worry about it."
The problem is, for a woman, well you're going to, actuarially speaking, end up alone. And then let's say you lose your job or you lose the ability to work, and you also lose that second Social Security check that had been coming in because your husband has died. How are you going to pay that mortgage? You still have to come up with that $1,200 a month and, for most people, that is an awful lot of money. And you could easily not be able to come up with that amount and then be forced to sell your home.
Would you advocate that women and couples seriously consider a 15-year mortgage in lieu of the traditional 30-year mortgage?
Absolutely. If you know you're going to be staying in a home -- and I would only do a 15-year mortgage if you know you're going to stay in that home -- a 15-year mortgage is usually a half-percentage point cheaper in interest rate to begin with than a 30-year mortgage. Why would you get a 30-year mortgage at a higher interest rate if you know you're going to pay it off in 15 years?
If there was one thing, one message you'd most want to emphasize on the subject of women and retirement, what would that be?
Please don't wait until something happens, until you suffer some emotional loss, to get involved with your money. Women, you have more talent in your little finger than you know. It's probably more than most men have in both their hands.
We women do it all, we honestly do. Can't we please turn that talent on ourselves? Can't we give to ourselves as much as we give of ourselves? Can we understand that the true gift, the true legacy to pass down to our daughters, is one that we can also give to ourselves? It's not being selfish, it's not wrong, it's not disrespectful. It's what is needed so that you can become a woman who owns the power to control her own destiny. You've got to do it and you've got to do it now.