Pros
- The stock market has historically returned an average of about 10 percent. While performance isn’t a sure thing, if your mortgage rate is less than 10 percent, you could come out ahead by investing.
- Stocks, bonds, mutual funds and ETFs are highly liquid, meaning you can sell them easily and use the cash for other purposes.
- If you put money into a retirement account, you might be able to take advantage of perks like employer matching and tax breaks.
Cons
- Stocks are volatile and there are no guarantees. A bad year or two could put a big dent in your portfolio.
- For many people, their mortgage payment is their biggest monthly expense. If you invest instead of paying the loan off, you’ll still have to make that payment.
