Loan Repayment vs Investments Calculator

Compare paying down a loan early against investing the same funds to see which path builds more long-term wealth.

Loan prepayment is the better option

Net impact +₹35,67,324 (₹69.67 L saved vs ₹34 L returns)

Break-even return 18.62% · expected 12%

Client details

Loan details

Outstanding principal

₹

Pending tenure

months

30 yr

Interest rate (p.a.)

Surplus funds

Prepayment amount

₹

Prepayment frequency

After a prepayment, the bank will

Investment asset class

Rate of return

Prepayment charges

Flat fee

₹

Penalty (incl. GST)

TaxInclude taxOff matches the spreadsheet. On: capital-gains rules by asset class, plus 4% cess.

Result

Loan prepayment is the better option

Net impact +₹35,67,324 (₹69.67 L saved vs ₹34 L returns)

Break-even return 18.62% · expected 12%

Keep an emergency fund before prepaying.

Loan prepayment

Better option

Prepay ₹20,000 a month · bank reduces tenure

Total interest saved

₹69,67,300

Investment

SIP of ₹20,000 a month for 146 months · Equity at 12%

Returns on investment

₹33,99,976

Prepaying comes out ₹35.67 L ahead

The longer bar wins.

What return would change the answer?

Expected 12%

0%5%10%15%20%25%

Prepaying betterInvesting better

Break-even at 18.62%: investing needs to earn more than this each year to beat prepaying.