To save or pay down debt?

[PrincessFiona]

Seriously? I had no idea. It's been awhile since I've looked at car loans! That makes me feel so much better!!

Kris

[diggitydot]

Seriously? I had no idea. It's been awhile since I've looked at car loans! That makes me feel so much better!!

Kris

Check out edmunds.com. They list all available marketing sales, "cash back", and percentage rate incentives. They even list the back-end incentives to the dealers that most people don't know are negotiable, too.

[ladymoreta]

I would split the money between paying extra and saving up. We are currently trying to get a good balance with this, too. We have a lot of different debts (loans, cars, mortgage, credit cards) that we prioritize by interest rate, but we also want to make a start on retirement savings and have an emergency fund. It feels like we're not making any progress anywhere, so maybe you shouldn't take advice from me.

[Deebs]

I'd do a little of both. Maybe price out what vehicle you think you'd want, figure out monthly payments you could afford, and save enough to make a down payment on a vehicle to bring the monthly payments to what you're comfortable with.


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[houseelf]

Suze Orman changed her advice about the savings/pay debt question circa the Great Recession. Credit became super tight, jobs were volatile, and as a result she started emphasizing emergency savings and cash over paying down debt. Obvs. the medical financial life is a bit different from Susie Q. Public's basic financial life, but I think about her conservative, protective approach a lot when making these decisions.

[Ladybug]

Pay off the debt. If there's an emergency you can use your now-open credit card.

Rinse and repeat until all your grandchildren are financially independent.