Please let me know if I’m missing anything. When it comes to investing vs. paying off debt, ppl say paying off debt makes you sleep better at night. But if I get fired tomorrow, I would not have $ for my monthly bills if I have been focusing on paying off debt. It’s not like i can reborrow student loans? So.. Wouldn’t I sleep better if I invest, because at least I will have more liquidity and can dip into my investment if I get fired?

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You first should focus on an emergency fund so you won’t have to sell investments. The second thing is somethings multiple bad things happen at once. If you were to lose your job and the market was doing poorly then you might be taking money out at a bad time. If you pay down debt then if something bad we’re to happen you have less required payments to make and your saved up money can go farther.

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Why not split the difference and and invest some and apply some to loans?

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Emergency fund > pay off high interest debt > invest 401K up to match (if applicable) ....y'all know the rest You can load an emergency fund AND pay off debt at the same time. Then invest, pay off more debt, invest more.

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It really depends on your risk tolerance and personal goals. For some people paying off debt makes them feel more comfortable. For others, saving and investing does. Similar to what EY1 mentioned, I do some of all 3. Although I’ve recently moved a large chunk of my savings to pay off private student loan debt since that interest rate is much higher than my HYSA these days. But I’m still keeping a 9 month emergency fund as well as maxing 401k, IRA and HSA. You just have to find what mix works for you

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You need an emergency fund first as this will prevent you from sinking into more debt if something goes wrong. Start with saving $1k then get to at least three months of expenses. If you don’t know that number make a budget and track your expenses.

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No, if you keep the debt, you’re just leveraging your investments. If you have a low or negative net worth, you probably already have too much risk. Keep a few thousand in cash then pay off debt. If something happens before you pay it off, you may need to borrow again but this way you’re at least derisking first.

Pay bills, invest money, and spend the rest however you want. This plan works wonderfully.

Always do what you can to have a solid emergency fund first. Next, those loans have required minimum payments. So if you do lose your job, you still have to pay unless the debt is all government student loans. And even then, you're probably accruing interest so now you're adding even more lost money to the equation. For investments, you should look to do the employer 401k after your emergency fund because that is basically a 100% return, then pay extra to your loans. Most other investments aren't going to help you if you lose your job. Either you can't access them because they're retirement funds, or you need to pay short term gains taxes on them or there is a chance that the market tales a dip and you would have to withdraw at a loss. Still with relying on your emergency fund for emergency. Plan out some options now to help with costs. Could you get a roommate? Move to a cheaper apt? Move back home temporarily? Pick up a side or retail job? If you're making more than the average American, you have hundreds of options available to you to cut spending in a time and maybe even make some extra cash in an emergency as long as you've planned ahead.

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