Asked by Anonymous

Should I commit to clearing my reno loan (5-yrs) and hdb loan as soon as possible or use my cash on hand to invest in REITs, Bonds and/or FD first?

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  • Hariz Arthur Maloy
    Hariz Arthur Maloy, Independent Financial Advisor at Promiseland Independent
    Top Contributor

    Top Contributor (Apr)

    Level 7. Grand Master
    Answered on 10 Apr 2019

    It would depend on the % of your loan. I'd clear anything higher than 4% per annum.

    For your HDB loan, instead of trying to clear it quick, just switch from paying with CPF to paying with cash.

    Btw, Bonds and FD will only give you about 1.5-4% return. Clearing your loan would also give you a similar "return".

    Comments (2)
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    • Besey
      Interesting about paying with cash instead of CPF for hdb loan, why so?
      10 Apr 2019
    • Hariz Arthur Maloy
      Because you earn 2.5-3.5% interest on your OA. So you lose out on this and have to pay it back to yourself when you sell your house.
      10 Apr 2019