Most people say their mortgage payment means they can't save

This is especially true of the next generation to retire

Most people say their mortgage payment means they can't save

When Generation X homeowners are thinking about savings, their retirement is likely to be on their mind.

But this generation is the one most challenged by their monthly mortgage payments (82%) according to new research from Bankrate.com. Parents with young children (81%) and millennials (78%) are also challenged.

Overall, 77% of respondents said their mortgage payment means they have nothing to save.

The survey shows that 39% of respondents say the equity in their home is greater than the balance of their retirement savings accounts while 28% said the opposite. Among those that own their home without a mortgage, 38% have more equity in their home than their 401K or IRA.

“One-in-five homeowners don’t know whether their retirement account balance is more or less than what they have in home equity, a possible disconnect to their own finances,” said Bankrate.com’s chief financial analyst, Greg McBride, CFA.

Refinance rather than pay-down
McBride added that homeowners should consider refinancing at a lower interest rate to cut their monthly mortgage payments are unlock cash for retirement savings.

“Don’t neglect retirement savings in a hurry to pay down or pay off a low rate mortgage. Money in a retirement account will pay the bills, home equity will not,” he concluded.