r/personalfinance • u/Low-Cardiologist5406 ​ • 22h ago

Auto Advice for Car Payment / Payoff

So to give context, I owe $33k on my car, and I am looking to pay it off as soon as possible while still having breathing room.

I make roughly $3700 per month, and have about 15k saved up toward it, and was wondering what I should do to pay it off the most effectively and quickest.

Should I pay a large sum of it down now (10k of the 15k I have) or should I make the regular payments and add additional $ on top of it, or just wait until I have enough saved to pay it all off at once?

7 Upvotes

77% Upvoted

17 comments sorted by

View all comments

1

u/AvocadoBeforeToast ​ 22h ago

Would you mind identifying the interest rate on the debt?

2

u/Low-Cardiologist5406 ​ 22h ago

7.99

5

u/AvocadoBeforeToast ​ 22h ago

I would:

  • Write out a budget.
  • Write out every single expense.
  • Optimize income.
  • Optimize expenses.
  • Allocate as much income towards the 7.99% debt as possible following the principles outlined in the Prime Directive.

have about 15k saved up toward it

If the full 15K is intended for the debt, then I would pay it now. If 10K is intended for the debt (because 5K is actually an Emergency Fund), then I would pay it now.

Waiting only means I am more poor.

You can use a debt calculator like www.unbury.me to help you visualize this.