Patton Financial Advising: Don’t Forget About Credit When Planning for Retirement

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Published February 25, 2024 5:21 am
Patton Financial Advising: Don’t Forget About Credit When Planning for Retirement

CLARION, Pa. (EYT) – Patton Financial Advising submitted the following article: Don’t Forget About Credit When Planning for Retirement.

As you plan for retirement, you might not give credit a second thought, especially if your plan includes paying off your mortgage and other debts, and relying more on cash than credit. But retirement could last many years, and your need for credit doesn’t necessarily disappear on your last day of work. At some point you may want to buy a second home, move to a retirement community, take out a home equity loan, or buy a vehicle; it’s also possible you will face an unexpected expense. Keeping your credit healthy may help you qualify for a lower interest rate or better terms on a loan or credit card, or if a credit check is involved, even help you land a part-time job or obtain a better deal on auto insurance.

When it comes to getting credit, it’s not growing older that matters — lenders can’t deny a credit application based solely on age. The factors that affect your ability to get credit are the same as for younger people and include your debt-to-income ratio (DTI) and your credit score.

Lenders use your DTI to measure your ability to repay money you borrow. This ratio is calculated by totaling your monthly debt payments then dividing that figure by your gross monthly income. For example, if your retirement income totals $6,000 and your debt payments total $2,000, your DTI is 33%. What’s considered a good DTI will vary, depending on lender requirements and loan type, but lenders generally look for a DTI of 43% or less.

Read The Full Article Here: Don’t Forget About Credit When Planning for Retirement

Patton Financial Advising
51 N. 4th Avenue
Clarion, PA 16214
814-226-9400
Toll-free 1-877-547-2751

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Visit website: www.pattonadvising.com

Securities offered through Cetera Financial Specialists LLC, member FINRA/SIPC. Advisory services offered through Cetera Investment Advisers LLC. Cetera entities are under separate ownership fhttps://www.exploreclarion.com/?p=353744rom any other entity.

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