Your Numbers

Mortgage balance $650,000

Mortgage rate 4.50%

PLOC balance $250,000

PLOC rate 4.20%

PLOC Purpose

Interest on investment-purpose PLOCs is tax-deductible. This dramatically reduces your effective borrowing cost.

Deductibility requires funds go to eligible non-registered investments — not TFSAs or RRSPs. CRA requires proper tracing. Confirm with your accountant before structuring this.

Expected investment return 7.0%

Time horizon

Marginal tax rate

Effective PLOC cost after tax

1.95%

4.20% x (1 - 53.53%) = 1.95% real cost

Because PLOC interest for investments is tax-deductible, your real borrowing cost is nearly half the posted rate.

5-year comparison

Prepay mortgage

Interest saved

Invest via PLOC

Estimated net after PLOC cost

Net difference over 5 years

in favour of investing

📈

Investing wins

With your tax bracket, borrowing at 1.95% effective to invest at 7% is a clear spread.

Key numbers

Break-even investment return 0%

PLOC interest cost (5yr) $0

Tax savings on PLOC interest $0

Mortgage interest saved if prepaid $0

Your mortgage rate grade

Grade your mortgage first to see how your rate compares to physician-specific pricing.

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