|
|
|
|
| Author |
|
|
Registered
|
so do you pay things off or let them ride?
I am not a financial expert, nor do I play one on tv. I have a question. My only market investments are 401k type stuff that is handled by TIAA-CREF and I pretty much ignore as I won't be touching it for 20 some-odd years. I have a small chunk of money in savings for rainy days (sadly a lot smaller than it was before 3 years of track/racing). I have a car and motorcycle note at the moment but that is it. I could pay off one or the other and still have an emergency fund, but I'm wondering if there is any sense in doing that. The interest rates are fairly low. The up side to paying one or both off is that I don't have a monthly payment and I just like having title to things. The downside is that I then lose that chunk of liquid assets for emergencies. With interest rates apparently heading skyward, it seems like it is best to sit tight with current debt rather than pay off and then (if something bad happens) have to scramble for money.
I'm not carrying any CC balances so this isn't having to deal with that. Just car and motorcycle note. No mortgage either. |
||
09-29-2008, 10:34 AM
|
|
|
Friend of Warren
Join Date: Oct 2000
Location: Lincoln, NE
Posts: 16,496
|
If you have the money. Pay off the loans. Then save the same amount of money every month as what your loan payments were.
__________________
Kurt V No more Porsches, but a revolving number of motorcycles. |
||
|
09-29-2008, 10:37 AM
|
|
|
Registered
Join Date: Aug 2002
Location: MD
Posts: 5,733
|
I would make sure you have ~6mo expenses saved before you do that.
|
||
|
09-29-2008, 10:41 AM
|
|
|
Driver
|
I'm no financial expert, but if you already have low interest rates on the two loans, maybe you're better off not paying them off. If inflation takes off over the next year or two, as seems quite possible or even likely, your low interest rates will seem even better. Of course, there's peace of mind knowing that your stuff is your stuff. Nothing wrong with that approach, either. (Full disclosure: my vehicles have all been purchased with cash.)
__________________
1987 Venetian Blue (looks like grey) 930 Coupe 1990 Black 964 C2 Targa |
||
|
09-29-2008, 10:42 AM
|
|
|
Registered
|
Quote:
|
||
|
09-29-2008, 10:45 AM
|
|
|
Did you get the memo?
Join Date: Mar 2003
Location: Wichita, KS
Posts: 32,575
|
I'd pay it off if you can still keep a good chunk in the bank. But I pay cash for crappy old cars too. At least nobody can take them away (or want to).
__________________
‘07 Mazda RX8-8 Past: 911T, 911SC, Carrera, 951s, 955, 996s, 987s, 986s, 997s, BMW 5x, C36, C63, XJR, S8, Maserati Coupe, GT500, etc |
||
|
09-29-2008, 10:48 AM
|
|
|
|
Super Moderator
|
I'd think about having closer to 2 years set aside. The loss of a job in a bad market can take a long time to turn around...
__________________
Chris ---------------------------------------------- 1996 993 RS Replica 2023 KTM 890 Adventure R 1971 Norton 750 Commando Alcon Brake Kits |
||
|
09-29-2008, 11:20 AM
|
|
|
Run smooth, run fast
Join Date: Aug 2008
Location: South Carolina
Posts: 13,449
|
I've heard several reputable financial gurus who have their own radio shows say don't pay off home loans just because you have the money sitting around... cash is what you will need if the bottom falls out... not a paid-off home in a market in which you can't sell it for a decent amount if you lose your job and need to move into the rental market.
But cash will be worth a lot less, so what if food starts costing 2 or 3 times as much (or more).
__________________
- John "We had a band powerful enough to turn goat piss into gasoline." |
||
|
09-29-2008, 11:28 AM
|
|
|
Driver
|
Quote:
__________________
1987 Venetian Blue (looks like grey) 930 Coupe 1990 Black 964 C2 Targa |
||
|
09-29-2008, 11:30 AM
|
|
|
Back in the saddle again
Join Date: Oct 2001
Location: Central TX west of Houston
Posts: 56,199
|
Quote:
__________________
Steve '08 Boxster RS60 Spyder #0099/1960 - never named a car before, but this is Charlotte. '88 targa  SOLD 2004 - gone but not forgotten
|
||
|
09-29-2008, 03:00 PM
|
|
|
Did you get the memo?
Join Date: Mar 2003
Location: Wichita, KS
Posts: 32,575
|
Quote:
__________________
‘07 Mazda RX8-8 Past: 911T, 911SC, Carrera, 951s, 955, 996s, 987s, 986s, 997s, BMW 5x, C36, C63, XJR, S8, Maserati Coupe, GT500, etc |
||
|
09-29-2008, 04:02 PM
|
|
|
Registered
|
Nostatic, I'm in the same boat as you, but make a lot less. 993 is paid off, but I carry notes on the BMW's. I have plenty of equity in both. I really need to get off my butt and sell the 330i. It's a expensive garage decoration. The ARM on my rental is fine for another 14 mos. No point making any extra princp. payments now. I am getting very concerned about my cash position. I don't really need it for anything right now, but am worried about the job disappearing.
__________________
2022 BMW 530i 2021 MB GLA250 2020 BMW R1250GS |
||
|
09-29-2008, 04:07 PM
|
|
|
|
MAGA
Join Date: May 2004
Posts: 10,779
|
No better feeling than knowing you don't owe anyone a dime.
__________________
German autos: '79 911 SC, '87 951, '03 330i, '08 Cayenne, '13 Cayenne 0% Liberal Men do not quit playing because they get old.... They get old because they quit playing. |
||
|
09-29-2008, 04:09 PM
|
|
|
MAGA
Join Date: May 2004
Posts: 10,779
|
Quote:
Rick, how much for the 330?
__________________
German autos: '79 911 SC, '87 951, '03 330i, '08 Cayenne, '13 Cayenne 0% Liberal Men do not quit playing because they get old.... They get old because they quit playing. |
||
|
09-29-2008, 04:10 PM
|
|
|
Registered
Join Date: Jan 2003
Location: IL
Posts: 1,638
|
Quote:
not looking for an exact answer... just a subject I've pondered. |
||
|
09-29-2008, 04:39 PM
|
|
|
Slackerous Maximus
Join Date: Apr 2005
Location: Columbus, OH
Posts: 18,196
|
I would not pay off any loans at the moment if you are decent interest rates. Lets things settle for a couple weeks. Cash is king at the moment. If things haven't turned into the Planet of the Apes by thanksgiving, pay them off....and leave yourself a 6 month cushion.
__________________
2022 Royal Enfield Interceptor. 2012 Harley Davidson Road King 2014 Triumph Bonneville T100. 2014 Cayman S, PDK. Mercedes E350 family truckster. |
||
|
09-29-2008, 04:41 PM
|
|
|
?
Join Date: Apr 2002
Posts: 30,533
|
Quote:
 ).
|
||
|
09-29-2008, 04:43 PM
|
|
|
Registered
|
Quote:
__________________
2022 BMW 530i 2021 MB GLA250 2020 BMW R1250GS |
||
|
09-29-2008, 04:43 PM
|
|
|
Registered Abuser
Join Date: Jul 2007
Location: Southwest Montana
Posts: 2,738
|
Pay off things when able, I do not like debt. No car loans, keep the mortgage, it's very reasonable. Have commercial loans for my business. No Card debt. As things are turning out I am glad I did not over extend. My business is way off this year looks like it's going to get even worse. Ready for the storm for a few years.
__________________
MT 930 1987 930 - Gone but not forgotten A man with priorities so far out of whack doesn't deserve such a fine automobile. I would rather wake up in the middle of nowhere than in any city on earth - Steve McQueen американский |
||
|
09-29-2008, 04:51 PM
|
|
|
Information Junky
Join Date: Mar 2001
Location: an island, upper left coast, USA
Posts: 73,189
|
Quote:
fwiw, I'm leaning toward CD's and municiple bonds. --some have suggested bonds from other countries. ...oh and 911 parts, of course.
__________________
Everyone you meet knows something you don't. - - - and a whole bunch of crap that is wrong. Disclaimer: the above was 2¢ worth. More information is available as my professional opinion, which is provided for an exorbitant fee. 
|
||
|
09-29-2008, 04:53 PM
|
|
1979 Porsche 911SC 3.0
Ducati
1987 Porsche 930 3.3T
1970 Porsche 911 S 
Only Porsche
Only bike
