But some prefer to invest rather than throw cash at any outstanding, low-interest debt.
Heres a simple way to decide if this route is right for you.
Weve talked about how tobalance investing with debt goalsbefore.
While its always smart to take advantage of an employer-matched 401k, beyond that, things get tricky.
And one option we mention is investing when you have a low-interest loan or debt.
once you nail sent the money to the bank, you cant get it back without a refinancing.
that would entail closing costs and a possible loss of your interest deduction.
Of course, the risk of going this route is that, well, theres risk.
Paying off your mortgage, on the other hand, is guaranteed.
Youll have a smaller mortgage.
Would you take out a $100,000 home equity loan and invest the proceeds in stock right now?
Of course, if youre buying and holding, your portfolio will almost certainly bounce back over time.
Still, paying off your mortgage means less debt; theres nothing uncertain about that.
In deciding which option is best for you, this question will help start you in the right direction.
