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December 12th, 2017, 00:36
Originally Posted by NewDArt View Post
Also, I'm not that smart.

For instance - let's say I have $10K in debt and $10K cash to invest.

If I pay that debt, how would I go about investing? Then I would have to save up money over a long period of time - which while it might be "cheaper" from that perspective, it doesn't leave a lot of potential for a return on investment for a long time.

Is the idea that I would instead invest minor amounts of money over time instead, or?

I thought the general notion was that, the more money you have for investments - the more you can expect to get in return through smart investments. Which should mean that I'd be able to pay off the debt eventually without missing a beat in terms of investments.

As for a "fun" account - I think that sounds good
It depends on the type of debt.
If you have a mortgage at 3% interest rate, then it does not make any sense to pay it off as your expected returns from investments should be higher than that (in addition to the house value hopefully going up).

If your debt is credit card debt at 40% interest rate per year then you should do everything you can to pay it off quickly, because otherwise it doesn't matter how much you invest, it is unlikely to generate more than 15% a year (unless you're a very lucky SOB).
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