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Investing Specialists

How to Develop a Plan for Paying Down Debt

Calculating ROIs for your investments and debt paydown can help you make wise capital-allocation decisions.

Investors spend a lot of time thinking about how much to allocate to various investment assets--stocks, bonds, and cash, mainly, as well as peripheral assets like gold. That's an essential decision, of course, as those asset-class choices will be among the primary determinants of how our investment portfolios behave.

What gets less attention, however, is what I've called primordial asset allocation--how we apportion our hard-earned resources across other assets and opportunities. One of the major allocation decisions that many of us make without a lot of thought is whether we steer our financial capital to debt paydown or investing in the market.

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