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Should I pay down my car loan?

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    #16
    Originally posted by mtricher View Post
    The $100k is in ordinary mutual funds (not IRA). I have $50k in a Roth (no longer qualified to contribute). That's where the vast majority of my extra cash goes. I contribute $1000 a month to that mutual fund. So technically, I could have a lot more cash on hand but I didn't want it to be sitting in the bank.
    You don't have any money currently sitting in traditional, SEP, or Simple IRAs? If not, it is very simple and painless to make "back door" Roth contributions. You contribute 6.5k to a traditional IRA, then immediately convert. There are no income limitations on conversions.

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      #17
      Originally posted by mtricher View Post
      The minimum payment on the jeep is $50 because I paid for it with my HELOC. Regardless of my balance all I have to pay $50 a month minimum. Current interest-rate is 3.75% for the HELOC, which is what i'm paying on that $20,000 loan for the jeep.
      We should have paid more attention to that in your OP.

      My rental property has the highest interest at 5.75. The others are both below 4%. I don't want to get into all the balances and payments right now because my main question was about the jeep.
      Bottom line is that you've got 4 debts:
      1. 3.75% HELOC
      2. sub-4% primary residence
      3. sub-4% vacation condo
      4. 5.75% rental property


      There are 4 ways to tackle them:
      • snowball them (pay off loans low rate to high), or
      • avalanche (high rate to low), or
      • "balanced" (which is what you're doing now),
      • random, planless.


      For someone in your good financial health, it doesn't really matter (though an avalanche will save you some interest).

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        #18
        I don't think the OP is in a classical "get out of debt" scenario. Unless we're missing something.

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          #19
          Originally posted by tomhole View Post
          I don't think the OP is in a classical "get out of debt" scenario. Unless we're missing something.
          Agreed.
          This sounds more like a cash flow question than a get out of debt question.
          Brian

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