Updated almost 7 years ago on . Most recent reply
Pay off Bad Debt or Start Investing?!
Hello BP! I need some advice!
I recently sold my primary home to start my investing career. Before I do I was hoping to get some feedback on what to do first.
Do I pay off my bad debt first and recoup my capital by cash flow stacking? (Which will take approx 3.5 years). By paying off my bad debt I will tie up half of my capital.
Or do I utilize my capital I have now to invest and use the profits to pay off the bad debt?
I know Rich Dad would probably want me to get rid of bad debt before investing but just wanted to see what experienced investors had to say.
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Tom S.
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Tom S.#3 Real Estate Agent Contributor
#3 Real Estate Agent Contributor
- Real Estate Investor
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@Richard Xiong If you mean by bad debt - credit cards -I would definitely pay them off first. Otherwise even if you qualify for a mortgage, you'll probably be paying a higher interest rate than needed. Even 1% higher over the course of many years = a lot of extra interest expense.