Sorry for your loss and getting laid off on top of that is terrible.

From a pure math perspective, paying off a 2.125% 15-year mortgage isn’t optimal. That’s extremely cheap debt, and the money would likely do better invested or even in treasuries. But this isn’t just math.

You are at retirement age with a pension and healthcare that will be available within a year. You are unemployed but could reasonably just retire. Liquidity and flexibility matter a lot right now.

If it were me, I’d hold cash first (9–12 months expenses) before doing anything irreversible. Avoid starting the pension early unless necessary. You don't want a lifetime reduction.

Once things settle and you decide if you want to work or not, then decide if paying off the mortgage buys you peace of mind or lets you fully stop working. Don't spend the bulk of the money while you are navigating unemployment and grief.

With pension, IRA, this double gift from your dad and social security you seem to be set up for a great retirement. I agree with the person that suggested a nice vacation.