Is it better to invest or pay off student loans?

Question

At the moment, I received a moderate inheritance and also have several debts with very different interest rates. At the moment, some are high cost credit cards, while others are a mortgage, student loan, or car loan with manageable payments. For context, the decision could affect roughly $45,000 in my situation, so I want to compare the tradeoffs instead of using a rule of thumb.

Soradin · Accepted Answer

Compare the loan terms and expected flexibility rather than assuming investment returns will be guaranteed. When the options are compared, whether to pay debt or invest depends on interest rates, tax treatment, cash reserves, risk tolerance, and the purpose of the money. The account or product should not be evaluated separately from the rest of the household finances, rather than focusing on the account or product in isolation.

Is it better to invest or pay off student loans?

Soradin

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