Rates go up- I break even on cashflow, and will lose equity if I have to sell upon my return.
Rates go down- I make money?
2 out of 3 good options ain’t bad, yeah?
If I know I deploy soon, what’s stopping me from loading up on debt and investing into bond funds paying 6%?
byu/weathermaynecc inMilitaryFinance
Posted by weathermaynecc
5 Comments
Are you Reserve or Guard?
Remember that these options are not equally probable, so 2/3 is deceptive.
Also, the “break even” option is neutral at best.
You lose money because you pay taxes on those 6% earnings.
Better: load up on NVDA.
Are you eligible for SDP on this deployment? If so get that 10% iinterest.
If rates go up, bond funds can lose $. The bonds they hold at current rates are worth less on secondary market when higher yield becomes available.
Max Roth TSP if CTZE and increase contributions to get the higher contribution limit if eligible and able.
Are these loans going to zero or very low interest rate while deployed?