what to do with our money?

From: Patrick and Kelly Engram (shetland@erols.com)
Date: Wed Jun 16 1999 - 23:03:03 EDT


    "We owe approx $11,500 on it with payments of $483.00 / mo. We have

about 2 -1/2 years
and it will be paid off. Should we just pay it off now with the extra
cash or put the extra $$ in the bank, and if we
can't make a payment, draw it of savings.? Or pay it off now? This is
our
1st experience with this sort
of situation. We really love the truck, but we know that it is
depreciating daily.
What would be our wisest move? Any answer if very much appreciated?"

-My suggestion on your wisest move would have to do with a few things.
Examine your financial picture and take the money and pay off the
highest interest rate loan/credit card you have. Keep applying until
you run out of money or pay everything off. You are now making the most
of your equity from your house and minimizing future interest payments.
If you do not have any other loans outstanding other than the truck,
than you could pay the truck off in full, or put the money into cd's
that mature 30/60/90/120 etc days in the future. CD's earn higher
interest than your savings account, and they keep you from dipping into
your account. However, if you want to sell the truck and need some of
that money to pay it off, you're SOL.
  My 2 cents-
Patrick



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