Читать книгу More Straight Talk on Investing - John J. Brennan - Страница 46

If you have high-interest credit card debt, you should pay it off before you begin investing. Some people think it makes sense to start investing even though they are carrying balances on their credit cards. They hope to come out ahead by earning returns on their investment that exceed the interest they are paying on their debt. But you'll see the danger in this approach if you think about it.

Most credit cards charge interest rates that are 15%–18% or higher. To earn even higher returns as an investor, you'd have to be investing in stocks, and you'd have to be picking investments that beat the long-term average annual gains of 10% that stocks have earned over the long run. The odds aren't very good that your investment will do that in a one-year period.

There's an additional danger in thinking that you can get ahead as an investor in spite of credit card debt. When you do this, you are hoping that the short-term returns on your investment (a big uncertainty) will offset debt payments that are a certainty. No matter what the market does, you will still have to make those credit card payments.

I can think of just one situation where it would make sense to start investing before you have paid off credit card debt. If your employer matches contributions to your 401(k) plan, you should get started in the plan right away, while of course paying down your debts as soon as possible.