Should I pay off my car loan?

Submitted by booyakuhhsha t3_z85h2o in personalfinance

I have a car loan at 3.69% and I could pay it off by liquidating some stock market assets. I generally think that I could make a larger return in the market than the car loan interest rate. What would you do?

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nolesrule t1_iy9u4ub wrote

What would be the tax cost for liquidating the stock?

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booyakuhhsha OP t1_iyac8r3 wrote

Long term positions, there would be some capital gains there

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justhereforpics1776 t1_iy9vggr wrote

No. That’s is considered a fairly low rate. Your investments should do better than that

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Opening-Friend-3963 t1_iyagwwg wrote

No way, I would never sell stocks to pay off something with such a low interest rate. Pay more monthly instead

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booyakuhhsha OP t1_iyazi9k wrote

Would you rather invest the extra money or pay off the loan at a faster rate?

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RapDangerous t1_iydynrh wrote

If there is someplace you can invest it, then I would do that. If it were me, I would just float this loan and invest the extra monies as long as its like tax saving accounts etc to use. If those are all filled up then I would maybe pay off the loan faster.

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binjammin123 t1_iyaii0x wrote

If you think you can beat that interest rate by being in the market why would you pay it off?

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