My wife and I have 2 small kids, a comfortable savings and significant equity in our house which is our only debt (5.5% fixed over 30 years) We are each contributing the max in our employer 401k's and after all the bills are paid we have about $600 left over each month.
We are considering taking a $65k home equity loan at 7% for 15 yrs. and investing the cash in a mutual fund portfolio targeting a 10-12% return. We will use the $600 per month mentioned above to service the debt. With a 15 yr. time horizon we think the market should allow the expected return. I have limited financial knowledge but this seems to make sense. Am I missing something?
2007-09-17
15:05:21
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2 answers
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asked by
cunninglinguist11111
2
in
Business & Finance
➔ Investing