⚖ Which saves more: investing or paying off debt?

You're facing a classic dilemma: a 20% 401(k) match is hard to pass up, but so is eliminating $100k in debt. The math depends on your loan rates—if they're low, investing wins; if high, debt payoff does. With a 50-60% savings rate, you have options most people don't.

This calculator weighs both paths. It compares the guaranteed interest saved by paying off your loans against potential market gains and employer matches over the exact same timeline.

Every extra dollar you pay toward your debt reduces your principal balance, yielding a risk-free return equal to your loan's interest rate. If your rates are high, this guaranteed return is hard to beat.

An employer match is free money, but vesting schedules complicate things. If your match vests over 3 to 6 years, you only get to keep it if you stay at the company. We factor in the probability you'll stick around to collect.

Investing your extra cash could outpace your loan rate, especially with an employer match. But market returns carry risk. We compare the future value of your investments against the interest you'd save by wiping out the debt.

We simplify by ignoring taxes on investment gains and the emotional relief of being debt-free.

This view was inspired by:

• student-loans-pay-extra-vs-invest

For further related reading, check out:

• Reddit