A loan on a motorcycle seems foolish in this....or any market. It's a toy. If you can't buy it...don't. With that said, basic economics apply. If you're earning less intrest with your savings than you're paying on your bike...it's a no brainer (and I think I know the anwer). Pay it off. Same for the car. Use common sense though....don't go broke doing it.

Everyone says "cash is king" but "don't use it". Unused cash is worth the paper it's printed on (maybe) if you don't use it. If you have cash...accumulate assets. Don't buy more cars...accumulate assets.

Thanks..... Unfortunately I am looking for something in the 10-12K range, but it never hurts to ask. :)

Normally, I'd agree. But I use the bike every single day. it gets 50 mpg and, if I had to unload some toys and vehicles, the bike would be the absolute last thing to go before I bought a bus pass.

what Rick said. Bike is now primary transportation for me. Only use the car when I have to shuttle the boy somewhere. We walk to and from school. Very little miles going on the car now. I could pay off both but that would leave me little rainy day money. I've also thought about selling the Audi and just buying a beater Honda for a couple $K. While I don't like debt I think at this point is makes more sense to just be patient and pay the bills. I have a feeling that single digit interest rates are going to look very cheap soon.

Ditto - we've been working our tails off to pay off debt and strengthen cash+investment positions. After living in debt for 20 years the thought pretty much makes me want to puke these days. Just the wife's MD loans and the mortgage left and I know I sleep a lot better with no credit card or vehicle payments.

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Todd, basically anything I have ever done with Porsche business, floating an engine project, buying/selling cars/parts, I have done with credit. It has always made more sense to keep any cash on hand as cash, and float the bill on credit. The interest rate I stand to make from asset appreciation was simply more than what I was sending out in payments. I've never been in permanent debt and unable to cover my credit leverage. And in the meantime I was getting flyer miles, 1% cash back on one card I used, and building up credit to where I now have a substantial credit line and credit history..

I would hold onto your cash and just make the car/motorcycle payments still.

+2!
It was the weirdest feeling walking out of the bank after paying off the mortgage and the line of credit.
I thought the bank might send an investigator out to see how one managed to get away.
I can't explain how it feels not to have that axe over your neck..... Sure the rates are low now, but I remember them being in the mid teens not too long ago. Just make sure your neck isn't too exposed when the axe falls...

That's what I am thinking right now.

My current situation: I paid my mortgage off last year, but I owe $$ on our two daily drivers (VW New Bettle Turbo, Ford Sport Trac). No revolving debt on Credit cards - I pay their balanaces off immediately. We have a decent amount of money in long term savings (401k). I've always put in the maximum allowed, and my company still matches $0.75 to the dollar, which is unheard of these days...

So, I can loose my job, they can take away my cars, but my home is mine, as long as I come up with the yearly property tax. I am not looking to sell my home - been here for nearly 20 years - and will probably stay here for another 10 years or so. My wife is a school teacher in NJ public schools, and she has tenure, so her position is pretty secure. And I've been working at the same company for 10 years, and its a pretty stable company, though you never know what's on the horizon...

We do have some home improvements planned this fall - getting the floors redone (they are all original hardwood floors), and planning on a total kitchen re-do. (House is 40+ years old). That's gonna set us back at least $35 - $40k.
So I guess I can take out a home equity loan or line of credit. But I will wait a couple of weeks to let the market and banking industry settle down a little.

Now, back to the asset stuff - I'm thinking of getting into some real estate ventures, given how soft the market is right now. Again, I want to wait a couple of months before investing in anything while the markets calm down - but I think going into the real estate market in some solid LONG TERM investments wouldn't be a bad idea now. Get a piece of property and house, take out a FIXED rate mortgage, and either rent that place out, or move in and rent my current house. Is there anything fallible in that logic?

Interesting times we live in. Interesting times.

-Z-man.

Mine actually matches $2 for each dollar up to a certain percentage. Yes, I do the max every month.

My current plan is to see what my Audi is worth. If I'm not upside down I might sell it and buy a beater car. That removes a significant chunk of debt. Cheap car, nice bike (with a payment). I can live with that.

Z-man, what county do you live in? I grew up in Hunterdon Co. and the property taxes there would crush people, even when they had paid off their houses. My folks were paying around $11k a year on a $500k property with zero services from the county - no snow removal, no police, no garbage or recycling. Just a volunteer fire dept. That area has surprisingly few seniors because none can afford to stay there even once they've paid off their houses.

Rick - I'm in Passaic Co. My taxes are about $10k a year. Hard to estimate the property value, but I'd say it's on par with your folks place. I do have garbage, recycling...etc.

-Z

The mafia ran our garbage pick up. In fact, Ralphie even mentioned our township in a Sopranos episode when talking about garbage routes.

Huh. Well semi-liquid assets I think is what I'm referring to. OUr non-401k savings is spread around quite a bit. Would take a some time to liquidate it all should we need it, but could access it in chunks over a few months. Some cash, some short CD's, some safe investments, etc.. We have a very very low percentage in the traditional market right now. Mostly thru dumb luck but the recent market tank didn't hurt us. I think I'm in a holding pattern right now... May continue for quite some time... :confused:

Aim for no debt. No CC, no mortgage. Keep 6 mos. cash in the bank.

I guess you have to calculate what 6 mos exp is with and w/o a particular payment. Me, I'd rather go as lean as possible and work to meet my leanest position of liabilities. I mean I could start picking trash for recyclables if the liability picture was low enough. And that just might be what I will be doing come this winter. I have my suspicions that some of these cats are clearing 150 a day. I pretty well know I could get that much panhandling. I don't currently make a whole lot more than that if I average out the days over a month.

So far, I've dumped my land line in favor of a cell, took a FOIS deal that is 60/month lower and a couple more smaller things.I canceled Excellence and Autoweek. The newspaper is next. I turned in my contractors license and have no insurance. I'm ready to hit the streets.

If it were me I'd dump the Audi and get something cheap you can pay cash for. Hoard some cash for a while, paying down the bike loan when you can. Once you have the bike paid off start putting the same $$ into the MMA for the next car.