Couldn't you do both?I've got a scenario on which I'd appreciate some PF blogger input:
I posted this question to another forum but then realized that this might be an even better place to get a response!
I've currently about $72,000 in debt, roughly $20,000 in student loans and $52,000 mortgage debt. Interest rates are low and debt is being paid down aggressively. I've also got total assets of roughly $300k, and a small business that I've been playing around with for several years just sold (literally closed today!) with net proceeds of $90k.
I'd like to hear opinions on whether I should use this cash to eliminate debt or invest it. I'm not saying that I'm going to listen, but I'd still like to hear your thoughts!
Liquidate invested assets of $72K to pay off student loan + mortgage.
Borrow $72K against your total assets of $228K ($300K - $72K).
Reinvest in the same $72K of assets. Now the interest on the 'new' $72k debt is tax deductable and you still have $300K worth of assets and no student loan and no mortgage?