Should I Invest or Pay Down Debt?
I’ve come into some money. Should I invest it or pay down debt?
A: This is a great question in this market environment. Interest rates are the lowest we’ve seen, which can make holding debt more attractive. The stock market has fallen, making it a good time to be investing. You can buy great companies with attractive dividends right now that may be double the amount you are paying in interest on your loan. However, the correct course of action isn’t so black and white. Now is the time to revisit your financial plan. What is your required rate of return and what are you trying to achieve with your strategy? Is the loan interest tax deductible? Call me to explore these options further.
Tanya Wilson, BBA, CFP, FCSI, CIM
Portfolio Manager & Certified Financial Advisor
Raymond James Ltd., member – Canadian Investor Protection Fund.