Quote:
Originally Posted by jamiefic
I think that it's wise to pay off debt - especially since you've done well to put money into savings and retirement. If you get the car paid off, then you'll have even more money to put other places (savings, retirement, etc.)... I would pay the lowest loan off first and then work your way up.
|
Welcome to you, too.
Paying off high-interest debt should always be a priority. Low-interest debt, however, is another story. I think it makes more sense to max your Roth in aggressive funds where you can expect to earn 8-10%/year rather than prepaying a car loan costing you only 5% or a mortgage that, after taxes, probably costs you even less than that.
As for which order to pay off debts, you should pay highest interest rate first and then move on to the next highest and so on. That will save you the most money and get you debt-free the fastest.
__________________
Steve
Join the 2009 Ebay Challenge!
* Despite the high cost of living, it remains very popular.
* Why should I pay for my daughter's education when she already knows everything?
* There are no shortcuts to anywhere worth going.