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.

If you have the money. Pay off the loans. Then save the same amount of money every month as what your loan payments were.

I would make sure you have ~6mo expenses saved before you do that.

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.)

That's my main concern. Right now I have about 9-12 months of expenses socked away depending on the details. I don't want to drop below the 6 month bar, and would rather have well over a year in the bank. Damn track car ;)

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).

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...

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).

Time to start hoarding Twinkies?

No, ramen noodles and Kraft Mac and Cheese for special occasions.

Have you been perusing my pantry?

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.

No better feeling than knowing you don't owe anyone a dime.

Rick, how much for the 330?

Interesting concept... but what is it 'set aside' in? FDIC insured savings? CD ladder? money market? bonds? can it simply be your bond allocation of your investments or does it need to be cash?

not looking for an exact answer... just a subject I've pondered.

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.

+1 (unless you're Trump, and owe folks MILLIONS upon MILLIONS :)).

Probably in the $16.5k range. It has everything sport/ZHP/cold weather, 77k miles.

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.

Good Q.

fwiw, I'm leaning toward CD's and municiple bonds. --some have suggested bonds from other countries.

...oh and 911 parts, of course.;)