The very first loan I ever got was for a used car. I had found out I was pregnant a few months prior so my husband and I went to the local dealership to find a good deal on a safe and reliable “family car”.
I wouldn’t say it was the best financial decision we ever made, but we love our Pilot and now we would love to pay it off. I just did some calculating and with just my side hustle money, I will be able to pay it off over 2 years early, saving about $1000 in interest. And that is with me still donating to charity and putting some money into savings.
My game plan is 10% to charity, 20% to savings, 50% to the auto loan, and 20% for misc expenses. I’m so ready to knock it out!
Share some of your tips that have helped you pay off loans early! I’d love to hear them!
I got a loan on a used car as well, it was terrible timing and also not my smartest financial decision. Looking back I wish I had kept my old Honda Accord which got much better gas mileage and is still running smoothly to this day. (Except for the fact that the person who purchased it from me messed up the front end a bit)
The only decent decision I made was to get a loan through my bank instead of with the dealership so I am only paying around 3% interest.
I have over 2 years left on the loan but the goal is to pay it off in 6 months while also paying off credit cards in 3 of those months.
Because of this, it means a good chunk of my wife’s and my paycheck is going towards paying down debt but we also are starting to follow the principle of paying ourselves first and we put a small amount into investments every month.
Because our living expenses are relatively low at the moment, (we can survive on my or my wife’s income alone) I can’t wait to have all the debt paid off so we can really start seeing the principles we are learning about finances pay off.
I’m currently looking into refinancing my car loan with a credit union because I’ve heard good things. The 3% is pretty incredible and it’s what I’m shooting for! I currently pay 5% but it’s worth trying to get it down a bit.
I see you said you put back money for charity. I had someone comment on one of my posts and part of what they said was to put money back for charity. Is this something most people do? What, aside from being an upstanding citizen, is the reason people put money aside for charity instead of using that money to pay off debt and once the debt is paid off then worry about distribution to charity? Is there a financial benefit or is this just a preference for some people?