Oct 18, 2011, Alberta boomers most likely to expect a mortgage-free retirement

Alberta boomers are the most likely in the country to expect a mortgage-free retirement, according to the 2011 TD Canada Trust Boomer Buyers Report released Wednesday.

The poll said 79 per cent of Alberta boomers expect to be mortgage-free in time for retirement and 62 per cent plan to stay in their current home.

When Alberta boomers do move, they’re most likely to say it is part of their retirement strategy (37 per cent). When they don’t move it is often because of their adult children.

The report also said 19 per cent of Albertans who are planning to downsize, but are delaying the move, say it is to accommodate their adult children. Thirteen per cent aren’t moving at all because they may have adult children living with them during retirement.

At the national level, 65 per cent of Canadians said they expect to retire mortgage-free.

“If you’re approaching retirement and still have a mortgage, it’s important to examine your options to make sure you can pay it down,” said Jessy Bilodeau, Mobile Mortgage Specialists, TD Canada Trust, in a statement. “There are repayment strategies that can help you pay down your mortgage faster such as increasing payment amounts or frequency and supplementing regular payments with lump-sum amounts — and, if you have adult children living at home, consider asking them to help with the mortgage payments. If they are living with you to save money, their contribution to your household finances would probably still be less than they would pay in rent elsewhere.”

According to the Canadian Real Estate Association, the average MLS sale price is forecast to increase by 1.5 per cent this year in Alberta to $357,500 and by another 1.8 per cent in 2012 to $364,000.

The TD poll also found: 37 per cent of Alberta boomers who plan to move say the move is part of their retirement strategy; they are the least likely in the country to be taking out a mortgage (48 per cent versus 59 per cent nationally) on their new home; they’re most likely to put down the largest down payment they can afford (82 per cent versus 68 per cent nationally); 47 per cent will try to save on interest by choosing a higher frequency of payments and 18 per cent will try to save on interest with a shorter amortization period.

BY MARIO TONEGUZZI, CALGARY HERALD