Help I want to retire but still have a mortgate

Women with CentsBlog, Mortgage

“I’ve only got 12 years left of work before retirement, and I still owe $180,000 on my mortgage. I work as a nurse and for health reasons I’ve just had to cut back my hours from 76 to 46 a fortnight. I only have $50,000 in super as I was only working full time for 7 years. I feel my future is looking grim on a single aged pension and no house paid off. Do you have any suggestions?” – ANON

OK. I know things are looking tough at the moment, but the good news is you still have time on your side, and interest rates are at historical lows. So first of all, I’d start by doing some calculations. Work out what your repayments need to be for you to be able to pay your mortgage off by the time you retire. Take a look at the Women with Cents Extra Repayment Calculator and How long to Repay calculator – they will help you get started.

Then, once you know what you are aiming for, you need a plan to get there. Here’s some options to help you pay that loan off faster than the 30 years the bank gives you!

Increase your earnings

A lot can happen in 12 years. Is there an opportunity for you to earn more in the coming years so you can add more to your mortgage? There are lots of ways to up your income – selling household items like furniture or clothes, or working a few extra hours each week if you can earn some overtime.

If the reduction in your hours is for health reasons, you can also investigate whether you have any insurance that can cover you for loss of income. For example, workers compensation can help if you were injured at work, or income protection insurance (which you may have in super), covers you for a reduction of income.

Consider renting out a room to help you bring in some extra cash towards the mortgage, and also (since nursing is a taxing job on your body) see whether you can move to a more administrative role.

Decrease your spending

If you can’t earn more, then see if you can save more. Small changes can really make a big difference. Read this blog for some extra ideas.

As an example, ditching the daily coffee could free up $1820 a year, or shopping at Aldi and saving $30 on your weekly shop could save you $1560 a year. That’s $3,380 more toward your mortgage each year – that’s a pretty good dent! Put those savings into our Extra Repayment Calculator and see how many years it will shave off your mortgage.

Work a little longer

Is working longer than 12 years a possibility? If you only had to work one or two extra years would you be ok with that if it meant getting rid of the mortgage? A lot of people today tend to semi-retire too, so rather than retiring from the workforce altogether, you could continue working beyond the 12 year mark, but reduce your hours to part time. That way you’re still earning an income and you’re able to enjoy the perks of retirement too.

Consider downsizing

Think about where you want to retire. Is it your current home or somewhere smaller, somewhere quieter, somewhere closer to your friends and family? Depending on how much equity you have in your home, if you were to downsize or move to a location where the housing is more affordable, you may be able to sell your home and buy another one, debt free.

Access free support services

If you feel you can’t afford a financial adviser, try having a chat to a financial counsellor. It is a free service, and they can also offer support and guidance to help you manage your budget and get back on track. The Financial Counselling of Australia website has more information on their services and how you can get in touch.

Centrelink also offers the Financial Information Service which runs free seminars and offers support officers to help you understand your entitlements and how to plan for retirement

Use your super

As you approach retirement there are strategies available to you that help reduce your tax and increase your super balance. Commonly called a TTR strategy (Transition to Retirement), a financial adviser can tell you whether its an appropriate strategy for you and help you get it up and running. They can also let you know if you are able to withdraw a lump sum from your super and use the money to pay off your mortgage.

If you are not sure where to start when it comes to finding the right adviser then stay tuned – in the coming months we’ll be releasing a list of passionate and affordable financial advisers to help you with exactly these types of things.

Get informed and take control!

Very soon I will be opening the doors to our Making Cents of Money program where you can learn more about taking control of your money in practical terms (including how to manage your super and your debts more effectively) – so keep your eyes peeled for that announcement!

And last but not least, remember to join our private  facebook group where our community of women is there to share their advice and experiences to help you along the way.

Submit a Question!

Have a finance question you’d like answered? Why not drop me a line! Each week I would love to answer a question from the community. Click below to get in touch.


The information provided by Women with Cents is general in nature. It doesn’t take into account your objectives, personal financial situation or needs. Think of it as educational material in which to help you make more-informed decisions. We recommend you obtain financial, tax and credit advice specific to your situation before making any investments or financial decisions.

Sova Financial Pty Ltd Trading as Women with Cents. ABN 71 163 435 836 | Sova Financial is an authorised Credit Representative Number 443432 of Finsure Finance & Insurance Pty Ltd, ACL 384704, ABN 72 068 153 926| Sova Financial is a corporate authorised representative no 468977 of Shartru Wealth Management, AFSL 422409, ABN 46 158 536 871