Tweet
Car Loan VS. Savings
I am taking on a new sales job which requires me to take a 60k (temporary) pay cut for the first year while I build my sales up. I need to re-budget so I can brace myself for this financial hit.
My last and big commission check from my current position will net me around $12000 which is the same amount I owe on my auto loan. Should I pay the loan off with the commission to free up the car payment ($280/mo) and give me extra "cushion" each month? I will be living from month to month for a while and that $280 will be very needed.
Or
Should I put the commission check towards my emergency savings fund which currently holds $2500 but research tells me I need $6000-12000 (3-6mo)?
*my longer term goal is to buy a starter house in 2017. I could use part of the commission check (less emergency fund contribution) to add to my down payment savings? I currently have about 47,000 saved for a down payment
Your thoughts are very appreciated!
My last and big commission check from my current position will net me around $12000 which is the same amount I owe on my auto loan. Should I pay the loan off with the commission to free up the car payment ($280/mo) and give me extra "cushion" each month? I will be living from month to month for a while and that $280 will be very needed.
Or
Should I put the commission check towards my emergency savings fund which currently holds $2500 but research tells me I need $6000-12000 (3-6mo)?
*my longer term goal is to buy a starter house in 2017. I could use part of the commission check (less emergency fund contribution) to add to my down payment savings? I currently have about 47,000 saved for a down payment
Your thoughts are very appreciated!