Prepay or Invest?
Should I prepay the loan or invest the surplus?
Premium
Prepay or Invest? is part of the paid plan
This one reads your actual position rather than projecting a single instrument, which is where the paid product starts. The free calculators below cover projections, loans and deposits in full — no signup, no limits.
What this calculation assumes
- •Prepaying is modelled as keeping the tenure flexible: the surplus is added to every EMI, the loan closes early, and the freed-up payment is then invested.
- •Investing is modelled as keeping the loan to term and investing the surplus every month.
- •Interest saved is certain; investment returns are not. The comparison is arithmetic only and ignores that difference in risk.
- •Tax deductions on home loan interest and principal are not modelled, and they can shift the answer.
- •Prepayment charges, which apply to many fixed-rate loans, are not included.
Illustrative only. These figures assume constant rates and do not predict actual returns. Markets, taxes and inflation vary. This is educational information, not financial advice — consult a SEBI-registered adviser before making investment decisions.
About this calculator
The question every borrower asks. Compare the net worth outcome of prepaying against investing the same money.