Frequently Asked Questions
When does paying off debt win mathematically?
When your debt interest rate exceeds your expected investment return. Paying off a 9 percent credit card is a guaranteed 9 percent return, while stocks are uncertain, so debt payoff wins in most market-risk-adjusted comparisons at that rate.
Why might I invest even when debt rates are high?
Employer 401k matching is an instant 50 to 100 percent return on contributions up to the match limit, which beats almost any debt rate. Most advisors recommend capturing the full match before extra debt payoff.
What counts as extra payment?
Enter the amount above your minimum required payment that you can dedicate each month. The calculator applies this to debt or investments depending on which strategy you are testing.
Why does the 5-year and 10-year net worth sometimes show negative?
If the debt balance is large relative to the payment, the debt may still be outstanding at the end of the period, so net worth is portfolio value minus remaining debt and can be negative in early years.
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Estimates only. Not financial advice.
Financial Disclaimer: Estimates only. Not financial advice.
This calculator provides estimates for informational purposes only. Actual financial outcomes depend on market conditions, personal circumstances, and decisions. Not financial advice. Consult a certified financial planner before making financial decisions affecting your future.