6 Debt Types Even Dave Ramsey Doesn't Think Seniors Should Pay Off

Many retirees may aim to pay off every single bill, but that blanket approach isn't always the wisest. As you head toward or enter retirement, keeping certain debts may be strategically better than rushing to eliminate them. Some loans offer low rates, protective benefits, or don't cost much to maintain. This could mean that if you crush your debt too early, you may harm your cash flow or nest egg.

Let's explore six debt types Dave Ramsey and other advisors say seniors can consider keeping.

When your mortgage rate is below inflation and payments fit your budget, Ramsey acknowledges that investing extra cash is critical to your financial future while simultaneously paying off your mortgage.

You'll still make a financial return if you have investments that average higher returns than the interest you owe on a low-rate mortgage. But if eliminating debt means dipping into retirement savings or losing liquidity, it may be smarter to leave the mortgage untouched and let time work in your favor.

Seniors with low income or on a fixed budget may qualify for low or $0 monthly payments through income-driven repayment (IDR) plans, and any balance remaining after 20–25 years may possibly be forgiven.

Ramsey generally discourages IDR plans for dragging out debt since they may prevent you from reaching your financial goals and hinder your progress. However, in retirement, this option can ease cash flow without hurting credit and may let loan forgiveness do the work for you.

With many states setting timelines of three to 20 years before debt becomes uncollectible, Ramsey notes that creditors cannot reliably sue after the statute expires.

These debts may drop off credit reports and lose legal force, making repayment optional. Monitor the clock carefully, though accidental acknowledgment could reset the timer.

Approved for adults 62 and older, reverse mortgages let you access home equity with no payments due until you pass away or sell the house. Ramsey says to take caution with reverse mortgages, noting that the loan balance will grow over time due to interest.

However, paying the loan off early can erase built-in flexibility and defeat the purpose, so seniors can often leave them in place and maintain cash flow during their golden years.

Certain unsecured, low-balance debts like minor credit card bills may carry limited risk, especially when wage garnishment or asset seizure isn't an option in your state.

Ramsey highlights that specific laws, such as the Fair Debt Collection Practices Act (FDCPA), may limit what collectors can do and help protect you as a consumer. The downside of waiting often outweighs the immediate payoff.

Ramsey says that 0% APR retail or auto financing deals can be risky. However, as long as you pay on schedule, the interest stays zero.

Instead of overpaying or accelerating without benefit, maintain payments and invest spare cash elsewhere. The real danger comes only if payments are missed, so discipline is key.

Even under Ramsey's rigorous debt-free system, some debts may be best kept after 60, especially when paying them off would reduce liquidity or raise the risk of tapping retirement savings. Low-rate loans, managed debts, and protective financing tools can support a comfortable, resilient retirement income.

Maintaining moderate, well-managed debt in the right circumstances doesn't derail financial security; instead, it can empower cash flow and flexibility in retirement. Consider Ramsey's tips to move beyond living paycheck-to-paycheck and decide which debts deserve your attention.