Be debt free or invest? - What would you do with 160K?

[K F.]

Hello All,

I know this is a very common question, but I'm curious what people will say. We recently sold a duplex that was no longer a good investment and made about 160K off of it. I still have about 50K in student debt and 15K in a car loan. Sometimes I want to just pay off those debts and and invest the rest, and other times I think it's better to just invest all of it and make more money with that money. So I'm wondering, what would you do? We are realtors just starting out and would like to invest in short term and long term rentals. Deals are pretty hard to come by these days, but we're hoping that will change soon before the value of our money decreases with inflation. Thanks for your feedback in advance! 

[Chris John]

@K F.

I guess I'll be the contrarion. I'd love to borrow 65k at 2%. It's difficult to believe that you can't find an investment that will pay you more than 2%. For instance, buy a SFR in Montgomery, AL. for 65k that rents for $700/mo. After paying for management, taxes, insurance, etc. you should have enough left over to make the payments on those debts. So, in essence, you'd still have your debt paid off, but instead of a zero balance it'd be getting paid off by an appreciating asset. (Having said all of this, I think there are better uses for that money, but it's the first thing that popped into my mind that runs around 65k).

Just a though as I know it's an emotional decision and I always lose this argument!  haha.

Best wishes with whatever you choose.