Home equity loan payoff

My SO and I just got a home equity loan for 60,000 at 4.99 over 10 year and if we just pay monthly amount it is over 18,000 in interest. We are not sure what is best thing to do… would it be better to pay that off as soon as possible or put the extra money we may get with bonuses to our retirement funds which include 401k and Roth IRA
I just finished the course and I have learned so much and now trying to make better financial decisions so when we retire in about 20 years we will be secure.

Hi @Alicia20d

Thank you for the question! What was the reason to get the home equity loan to begin with?

I generally lean toward paying down any debts (outside of your mortgage) as quickly as possible to simplify your financial life and allow you to just focus on building wealth. If you haven’t seen the below already, PFC has a checklist of steps to follow when thinking through investment decisions. As a quick note when you are looking at the checklist, I think about a home equity loan as non-mortgage debt since it’s usually taken out for reasons other than being able to buy your primary home.

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Thanks so much. We decided to go “Ham” on that debt. I also just opened a brokerage acct for my kids to start putting their earned income to get them started early. Thanks again for the classes and helping to educate those who never learned about index funds etc,

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That sounds like an excellent plan to me, thank you for the reply!

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