ST Alpha - "If the interest rate you're paying on the debt is higher than that which you can reasonably expect to receive by saving, then paying down debt is the" (Reading a Post)

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If the interest rate you're paying on the debt is higher than that which you can reasonably expect to receive by saving, then paying down debt is the

Posted by Subversive Jul 1 '09, 19:37

logical choice.

Show me an investment that will guarantee you the same rate of return as paying off a credit card. It doesn't exist, so it makes more sense to pay off debt than it does to save, especially if the debt is re-extendable in the case of an emergency (say, a line of credit or a credit card). You are effectively building a safety net, albeit a less than ideal one. If you can get the debt paid off, then start to build a proper one.

I can't believe there was an argument about this.

Responses:

I just got back from poker. Are we still talking about my situation? :\ -- nm - nubby Jul 1, 20:14
you're totally right. however, JD and I were saying that is not the *same* as putting money in savings. -- nm - loosilu Jul 1, 19:41
Subversive is correct. -- nm - ty97 Jul 1, 19:40 2
- So are you like...close now? - oblique Jul 1, 19:41 1
  - ...now? When weren't we?! -- nm - Subversive Jul 1, 19:43

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If the interest rate you're paying on the debt is higher than that which you can reasonably expect to receive by saving, then paying down debt is the

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