Selling Stocks

Q: used my home equity line of credit to buy a piano. I can sell all my stocks, mutual funds and index funds to pay it off. Should I pay it off all at once, or in installments? The line of credit rate is 5.25%. The reason I ask is that so far, my investments have been doing well and I'm hesitant to get out.

A: I used my home equity line of credit to buy a piano. I can sell all my > stocks, > mutual funds and index funds to pay it off. Should I pay it off all at > once, or > in installments? The line of credit rate is 5.25%. The reason I ask is > that so > far, my investments have been doing well and I'm hesitant to get out. 5.25 is a pretty good interest rate, so long as it is fixed. If it is adjustable, then you likely have a little surprise coming based on fed rates going up yesterday. Even at 6% this isn't that bad. If you are happy with your investments, and you have cash flow to make the loan payments, then leave things as-is and make the payments. If these stocks and funds are in a 401K, IRA, or other retirement fund, then do not touch them under any circumstances. Those are there to buy food when you are old and unable to work any more.

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