Paying off your mortgage before helping your kids buy a house sounds wonderfully tidy. The parents enter retirement debt-free, the children get a financial head start, and everyone celebrates with a housewarming dinner that nobody has to finance.
Real family finances rarely cooperate with such a neat arrangement. A parent might have $200,000 left on a mortgage and enough investments to eliminate it. Meanwhile, an adult child has a steady job, decent credit, and a down payment that falls frustratingly short. Helping with that down payment could make homeownership possible sooner. Paying off the mortgage could reduce the parents’ monthly expenses for decades.
