• “If you won the lottery, what would you do with the money?”
There’s the usual responses like buying a fancy new car, going on a shopping-spree, taking an exotic vacation, that thing you always wanted, etc. But after all you filter out all the fun responses, most people come to two very sensible responses:
• “I’d use the money to payoff my house”
• “I’d invest the money”
Although not all of us will be winning the lottery anytime soon, we make much smaller-scale decisions along these lines all the time. For example:
• Every paycheck when your money goes into a 401(k), have you ever considered if putting it towards your house was the better option?
• Have you ever got your income tax refund, a profit-sharing check, or an inheritance and thought if one was better than the other?
So let’s dive into this question and take a look into the factors that make one option more favorable than the other.