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Old 03-13-2013, 08:21 AM   #1
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How would you spend this money?

I was just informed that we're going to be gifted $5,000.

Right now our debt is:

Mortgage ($176,000 left - we pay $1,400 a month)
1 cay payment ($12,500 left - we pay $240 a month)
Student loan ($800 left - we pay $100 a month)

Obviously we'll pay off the student loan in full, but would it be better to throw $4,200 at the car, or are we better off putting that money into savings "just in case". The interest rate on our car is 3.14%, and we have about $6,000 in savings currently.

Thanks!

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Old 03-13-2013, 08:23 AM   #2
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Re: How would you spend this money?

Since you have a little cushion in savings, I would pay the car, then once it's paid off fully, deposit those funds in savings
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Old 03-13-2013, 08:34 AM   #3
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Quote:
Originally Posted by mamaerica
I was just informed that we're going to be gifted $5,000.

Right now our debt is:

Mortgage ($176,000 left - we pay $1,400 a month)
1 cay payment ($12,500 left - we pay $240 a month)
Student loan ($800 left - we pay $100 a month)

Obviously we'll pay off the student loan in full, but would it be better to throw $4,200 at the car, or are we better off putting that money into savings "just in case". The interest rate on our car is 3.14%, and we have about $6,000 in savings currently.

Thanks!
If you follow Dave Ramsey, he would say pay off the SL, put the rest on the car, then every month pay $340 on the car (the original $240 plus th $100 that would have gone to the loan). Once the car is paid off (which will be even sooner with an extra $1200 per year), build up your savings.
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Old 03-13-2013, 08:41 AM   #4
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Originally Posted by tygr2410 View Post
Since you have a little cushion in savings, I would pay the car, then once it's paid off fully, deposit those funds in savings
Yep. pay off sl then throw money on car. Take the sl payment and add it to car payment monthly
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Old 03-13-2013, 08:59 AM   #5
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Thanks - that's what I was thinking I should do, but I just wanted to make sure.

I should add that my stepdaughter turns 21 in August, and we will no longer be paying child support. That will be an additional $350 a month that I will be applying to the car payment.
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Old 03-13-2013, 05:41 PM   #6
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Re: How would you spend this money?

I would pay off the student loan and put the rest towards the car.
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Old 03-13-2013, 06:11 PM   #7
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Re: How would you spend this money?

Quote:
Originally Posted by mamaerica View Post
Thanks - that's what I was thinking I should do, but I just wanted to make sure.

I should add that my stepdaughter turns 21 in August, and we will no longer be paying child support. That will be an additional $350 a month that I will be applying to the car payment.
Even better. That car will be paid off in no time with all that extra being thrown at it. I think there is enough in savings until then.
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Old 03-13-2013, 07:28 PM   #8
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Re: How would you spend this money?

Put it all on the car, you have a great amount of savings, so slay that debt!
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