Should You Pay Off Debt Or Invest?
With the stock market at the lowest point in years, many people are wondering whether they should pay off debt or invest that money in the stock market and wait for it to go back up. There’s no single right answer to this question, but there are a couple of things you need to consider. First, how much interest are you paying on your debt? If it’s on credit cards, you could be paying 18% or more in interest on any outstanding balances. Can you make a guaranteed 18% in the stock market? That’s essentially what you’re doing when you pay off debt. And second, how long are you willing to wait? Chances are the stock market will rebound, but it could take several years. In the meantime, your money could be locked up unless you’re willing to lose even more when you take it out, if the market has gone down even further.