The Money with Katie Show The Ultimate Formula for Determining Your Financial Priorities
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Jul 22, 2024 Rich Girl Roundup discusses whether to pay off a mortgage or save for retirement. The hosts provide advice on balancing financial goals, retirement savings, and debt management. They also explore the trade-offs between paying off debt faster or investing in risky mutual funds. Additionally, the podcast addresses the sacrifices needed for future financial security and the importance of maintaining a balance between financial success and personal well-being.
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Natalie's Dilemma
- Natalie, a 28-year-old engineer, invested in a rental property using a HELOC.
- She's debating prioritizing aggressive HELOC repayment over maximizing 401k contributions.
Cost-Benefit Analysis
- Compare the interest rate on debt with the average return of the stock market.
- Consider tax benefits when comparing debt repayment to pre-tax investment accounts.
Tax Benefits of Investing
- Pre-tax contributions to investment accounts lower the tax bill.
- Debt payoff doesn't offer the same tax advantages as pre-tax investing.