Should I pay down debt or invest my monthly surplus?

When you receive some extra money it may be difficult to determine whether you should invest the funds or use them to retire debt. Financial theory recommends that if your after-tax return on investments is greater than your after-tax cost of debt then you should invest. However, remember to consider the inherent riskiness of the investment you select (i.e. you may lose the money you invest yet still have obligations to pay back the liability). Use this calculator to help analyze your situation.
Rates and Assumptions
Interest rate on debt (%) 
Is the interest deductible? 
Before tax return on investment (%)help
Is the interest taxable? 
Marginal tax bracket (%)help
Monthly funds available ($) 
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This information may help you analyze your financial needs. It is based on information and assumptions provided by you regarding your goals, expectations and financial situation. Marquis, Inc., First Tennessee Bank National Association (operating as First Tennessee Bank and Capital Bank) (“FTB”), and its affiliated companies do not assume any fiduciary duties and do not provide any investment advice in providing calculations. Calculations provided may differ from calculations made by other commercial or financial institutions or entities. In addition, such service should not be relied upon as the only source of information. Hypothetical illustrations may provide historical or current performance information. Past performance does not guarantee nor indicate future results. Use of service is provided without warranty of any kind, either express, implied or statutory, including FITNESS FOR A PARTICULAR PURPOSE, MERCHANTABILITY, AND ACCURACY. Use of service is entirely at the user’s own risk, and user should seek professional financial and legal advice without reliance on service and calculations. Marquis, Inc., First Tennessee Bank National Association (operating as First Tennessee Bank and Capital Bank) (“FTB”), and its affiliated companies shall not be liable for any differences is calculations with other financial institutions or entities, lost profits, lost business, losses of any kind, direct or indirect damages, punitive or consequential damages or damages of any kind arising out of the use of this service. User agrees to indemnify and hold Marquis, Inc., First Tennessee Bank National Association (operating as First Tennessee Bank and Capital Bank) (“FTB”), and its affiliated companies harmless from any and all liabilities and costs (including attorney fees) for any improper use or violation of these terms.

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