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If I have a low intrest home improvement loan, should I make extra payments or invest extra money instead?

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  1. GET OUT OF DEBT...THIS GIVES YOU OPTIONS
  2. It depends on how low the interest rate is and what type of a loan you have. Compare the after tax interest on the loan with an after tax interest you can earn on a guaranteed investment, like a CD. If it's a home equity loan that you used to make improvements, the interest should be tax deductible. That means you could compare your loan's rate with the rate on the investment directly. If the loan is not tax deductible, make sure you reduce the investment interest rate by your marginal tax rate to make the comparison.