Paying Off Debt In Retirement

Paying off debt in retirement is feasible with the right plan of action. Here at Miramontes Capital, we are fielding a frequently asked question from our clients—how do you pay off debt during retirement?

Paying Off Debt In Retirement

Q: What if my spouse and I do not retire at the same time? My wife has a pension and I have a variety of investments and an IRA. We would both like to retire soon, but we have some debt: about $20,000. Do you think it is a good idea for one of us to work a little longer to get the debt down before we retire, or should we use our retirement income to pay off the debt as we go?

A: While there may be certain benefits to retiring at around the same time as your spouse, perhaps only two in ten couples, maybe fewer, are able to enjoy this. There are simply too many factors that influence when a person decides to retire, and very seldom do these factors match up perfectly for two partners. Perhaps with a great deal of planning in advance, matched with a consistently comfortable amount of income, you and your spouse can start your retirement together. But don’t feel bad if this is not on the table for you.

Now onto your debt: while it is not a significantly large amount, it should not be taken lightly. Once you retire it can be easy to view your savings as a reward for all the hard work you have done over your life. In a way, it is. But it is also a finite amount, so you want to do everything you can in your working days to secure a steady income after retiring—that’s priority number one. You should seriously consider continuing to work until that debt is completely minimized. Getting a retirement income from one source and a working salary from another can be very effective in doing that. Even one year of work and disciplined repayment can greatly reduce the likelihood of dealing with that nagging debt for much of your retirement.

You Have Options For Paying Off Debt In Retirement

Another option for paying off debt in retirement, if continuing to work is not in the cards, is using retirement dollars to eliminate the debt. Say that $20,000 of debt is from one or more credit cards. If you will be paying $700 per month toward the debt, that presents a serious obstacle to your monthly cash flow. Eliminating that debt up front will save a lot in interest charges, and give you more peace of mind. A financial professional at Miramontes Capital can guide your decision-making more specifically by looking closely at your situation, so you may want to consider enlisting one. 

If you are still wondering about paying off debt in retirement, you should consider contacting a professional at Miramontes Capital to assist you in the process.

Sid Miramontes and Miramontes Capital have helped more than 1,000 people achieve their retirement goals—and Sid’s new book catalogs that dedication to every single client in the retirement planning process. You can request your copy of the book “Retirement: Your New Beginning” by clicking here.

Schedule an in-office or over the phone consultation to discuss how Miramontes Capital can help you with your new beginning through retirement planning.


Miramontes Capital is a Registered Investment Adviser. Advisory services are only offered to clients or prospective clients where Miramontes Capital and its representatives are properly licensed or exempt from licensure. This website is solely for informational purposes. Past performance is no guarantee of future returns. Investing involves risk and possible loss of principal capital. No advice may be rendered by Miramontes Capital unless a client service agreement is in place.