so you just got a check for $20,000 what would you do?

#2

 

vehicles don't depreciate quickly.
much better than most things you buy. think of what your old t shirts are worth after 3 years, or your 3 year old toaster, tv, microwave, socks, couches, stereo, truck tires.... it's all near worthless, while a truck is still worth a lot of money.

 

Definitely would have to go with the credit card then towards the mortgage.

If it was me personally that was given the check, I'd pay off my student loan and put the remaining 6k into savings.

 

I dont want to be a dick but think about it this way. Since you'd be putting 10k in a CD and continuing to pay the CC at 15%.

If you had no credit card debt, would you charge $10k on it at 15% interest to invest in a CD that was going to return maybe 2.8%? Doesn't make any sense.

if I had no emergency fund, I would Satisfy the balance on the car since it is a collateral asset it can be seized if I got into trouble with bills. I would then pay off the entire credit card balance.

I was probably paying $500 a month between the car and credit card anyways and I can roll that free capital against the 2nd mortgage. The Doctors loan is free money at 0%. I do that last.

 

Always pay off the highest rate loans unless there are some tax reduction opportunities.

One variable is the home mortgage because you can write that off on your federal taxes, and the effective rate on interest you pay will be lower than nine percent. Consult your CPA.

For me, the payment per month amount is meaningless.

It's all about getting the most money where it belongs: on the principle of any debt you may have and not getting sucked up in interest payments...

 

OK let me throw a wrench into the works.
if you pay the doctor bills off you can save 10% so now you just saved a $1,000.00
the second on the house is a right off so???
this is what i told him, pay off the credit cards, then pay off the doc. reasoning is the second is a write off. the truck will be paid off in 2 years (that is what is left on the loan)
and by paying off the higher dollar amount monthly payment he will not be so strapped and be in a better position if anything happens to his job.

 

Didn't know about the 10% off on the doctor bill.

Yeah, that's sounds like good advice, especially if there is a monthly cash flow issue where the amount of payment per month is a factor for his budget...

 

Pay the rest of my truck off and go on a bad ass vacation for a month!

 

Pay off as much debt as you can. The thing that's wrong with America is that people buy crap they can't afford and when they get money to pay back the loans they buy more crap instead.

 

Finish off my flying lessons and have my PPL. Get a street bike, then put the rest in the bank.

 

since I dont have any bills right now, I'd probably move and start over in another state.

 

X2. Get rid of All the debt you can. If you close out all your debt & still have cash, buy guns.

 

Throw it in the fireplace

 

Same credit card and mortgage. Between these 2 over say the next ten years (at 9% and 125 a month that's a ten year mortgage and assuming he's able to put about ~150 a month to paying down the CC debt = 10 years) that's a saving of about 15000 in interest. The doctors bills although high aren't costing him anything and the car assuming its a 5 year is only about 1.5k in interest.

Interest = throwing away money.

so that 10000 mortgage actually is costing him about 15000 and the credit card about 20000 over the next 10 years. that right there is 15000 saved that can be put to use to what ever else needs to be done over the next 10 years, whether that be the car loan, doctors bills or toys

 

This seems like the route I would take. Leaves him with an extra 500 per month to pay off his truck faster if he wishes, when that's done, assuming a 350-400 dollar monthly truck payment, he's then got 850-900 dollars a month to tackle the second on his house.

This is all assuming he was able to keep up with his payments before the mystery check. (btw ask him where we can all get our hands on one)

 

Missed this post. Depending on the value of the write off, then he's probably best off doing what you said and getting himself some leeway on monthly payments.... after all the gov' is essentially paying his interest on the mortgage then so it can be considered "0%".

Also w/ 2 years on the loan that's only 500 bucks over 2 years.... pointless to pay off smallest savings. If it weren't for the write off on the interest, then see my previous post.

 

Sell my current Tacoma, use that money and the $20,000 check to find me a nice, slighly used 4x4 Tacoma.

 

So this is a blindside hit thread on how to pay off bills the right way? Honestly I cant understand what the hell you are saying one way or the other and I'm kinda buzzed from the nights booze.

Firts of all you never pay unsecured debt like student loans or credit. What the hell will happen? There is nothing the lender can take back.

You pay secured debt like mortgages and auto loans first. Even the engagement ring is something they can take back so you better pay that.

Medical bills are non interest barring accounts so they are the lowest priority. Remember they cant refuse treatment even if you owe them. Not to say you will get the best of care but you will be treated.

Take it from someone that is in the collection industry. I know how this shit works.

 

this guy scares me a little ^ . . . and i didn't feel like reading all the hypothetical scenarioness of the op so i'll just answer it my way. i would pay of as much of my depts as possible (right now just my truck) and bank the rest. i love watching money sit in the bank.

 

No JG things can get a lot ***** but for a starting point that is how to prioritize who to pay.