Todd, age 54 and single, has a $26,000 debt due for an investment loan he used to buy stocks in his non-registered account. The fair market value of those investments is $11,000 (book value $26,000) and plans to sell those investments to reduce the debt. Todd has a RRSP with a $35,000 FMV (book value $14,000), their emergency fund invested in a $21,000 TFSA (high interest savings account) and a non-registered balanced mutual fund portfolio with a FMV of $22,000 (book value of $16,000). What recommendation would you give Todd to pay off his investment loan?

1. Sell $15,000 of the RRSP assets and pay the balance of the investment loan
2. Cash in $15,000 of the TFSA account and pay the balance of the investment loan
3. Sell $15,000 of the balance mutual fund portfolio to pay the balance of the investment loan
4. Borrow the money from his credit cards until his bonus comes in at the end of next month