If the interest rate on your debt is high, using some of your savings to pay it off might be a good idea. For example, if the interest rate on your loan is 12%, you would have to earn more than 18% on your savings to justify not using it to pay off the loan. Weigh the pros and cons of this option carefully. Savings accounts are your safety net for periods of unemployment or underemployment, unexpected expenses such as home and car repairs or medical bills, and for protecting priority debts such as a mortgage or a car. If you can, keep a savings account to cover your priority debts.
Be sure to contact us to discuss all of the options available to you before making a decision.