To pay off an outstanding loan or to invest? Resolve the dilemma and make the right choice

If you have an outstanding debt, should you prioritise paying that off or use the funds at hand to invest to secure your future? While the answer may seem simple, it is not so. You may be conditioned to first repay your debt, but there is merit in continuing your loan, and giving preference to investments. This article explores various factors to consider when faced with such a dilemma. It highlights aspects such as tax benefits of loans, credit score, as well as loan interest vs expected returns. Furthermore, it talks about which loans you should choose to repay and how to invest to make your money work for you. Read on and make an informed decision.

Should you pay off an outstanding loan or invest for the future? As Indians, most of us are conditioned to think that debt is bad. Often, many of us find ourselves in a dilemma due to a sense of obligation or even guilt. However, just as with everything else to do with finance, there is no one definitive answer. In this article, we shall examine what you should consider before taking a decision.  To pay off an outstanding loan or to invest? Debt represents money you have borrowed, and you will be paying interest on it. Investing, on the other hand, is a way to make money work by exploring options such as stocks, mutual funds, PPF, etc. that will grow in value over time. Naturally, if your debt is not handled properly, it can become a monster that drains you of both money and ene...

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