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I'm not much into the whole planning thing yet, but aren't there circumstances like that? Circumstances in which you would be a lot better off having kept a paid off house instead of having the cash or other liquid asset from either selling the house or paying the mortgage as slowly as possible?

The usual reason it would make sense to pay off the house entirely is to need less monthly cash flow. That means you can retire on a smaller asset base, and live in your house. Note that this implicitly assumes that your own retirement income is a bigger concern than what you leave in your estate.

That won't be a compelling argument for all circumstances. In particular, it is not a compelling argument for the circumstance of having plenty of assets, which is what people arguing for keeping the mortgage seem to typically assume. But if it's a case of living on just Social Security is *almost* practical, it might become practical with no mortgage.

YMMV. I paid off my mortgage years and many life changes ago, and I don't see that it makes any sense for me to borrow against my house when I have good enough liquidity already. Instead of paying a mortgage where the interest is only useful for federal tax deductions, I'd rather be dumping that cash flow into my 401(k) to reduce my current state and federal taxes. I anticipate of having a lower marginal federal tax rate in retirement, and the first $20K of retirement account distributions are tax-free on the NY side once I'm over 59 and a half years old.

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