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I won't bore you with the details, but I've finally got my finances looking reasonably Foolish. I have no debt other than a $17K loan against my 401k and am confortable with a lifestyle which leaves me enough extra money to invest for retirement, which won't be until 15-20 years from now.

I am in a position where I can afford to open a Roth IRA this year with the $2000 maximum and keep putting in $3000 a year into it.

Is it more Foolish to start a Roth IRA immediately, or should I save the money and use it to pay off the loan against my 401k?

I'm paying 6% interest on the loan, which goes into the 401k also. The loan is being paid off by automatic payroll deduction and will be paid off in 40 months, with roughly another $1800 in interest.

Messing around with some figures, I make it that if I delay starting the Roth, I'll be able to pay off the loan 22 months early (saving $500 interest). If I open the Roth and make maximum investment as soon as I can each year, I'll be able to pay it off 13 months early (saving $200 interest).

Which way is likely to be better?

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