paying truck off early....

This just isn't true. Amortization weights the interest early but spreads it thru the entire life of the loan. Pay more per month and you are shaving payments off the end.

 

i think (could be wrong) he meant to say he's already paid a majority of the interest...

 

theres really no "tricks" to paying off a loan early. its basically if you have the extra cash or not.

 

no ive paid about 2 years of interest opposed to 5 years of interest, but i see where your going with that

 

Probably the worst advice I've ever heard.

 

What's your truck worth? I have no idea, but say its worth $16k, you could sell it and pay off the $8k you owe, take the $6-7K of cash you have after taxes and replace your wife's car (which you said is about to die) with a decent little Honda that's only got 100k miles and will run for another 10 yrs and you own it free and clear.

Vehicle payments are about the dumbest thing people waste money on. Take $20 and buy a Dave Ramsey book, it will change your life.

 

agreed... I also didn't have 30k laying around for a truck. I now own my 2007 free and clear with only 50,000 miles on it. I'd say I'm in pretty good shape as far as vehicles go. I suppose mortgages are dumb too huh?

 

get second job, and dedicate that pay check just to the truck.

 

rcbs, thats exactly what i was thinking about doing.....i just figured its more truck than i need in terms of how nice it is. I could drive around a beater pick up that would cost me a few thousand since i have the company vehicle anyway. But then again, once that beater dies im back to square one, i guess i'll just keep paying on it.

 

theres a local place that offered me a little over 22k for it too.....

 

A mortgage is completely different than a vehicle payment, esp when the only alternative is rent which is sometimes more than a mortgage payment. Also, with the exception of the last few years, a house generally appreciates in value, whereas a vehicle will ALWAYS depreciate.

And you say you don't have $30k in cash to pay for a vehicle, my point is nobody needs a $30k vehicle, they just WANT one. You can do great with used vehicles if you are smart about it. Stick to Honda and Toyota, buy STOCK vehicles with few previous owners, and study the person you are buying it from, it will tell you a lot about how its been treated. The money you will save in a payment can go to a repair fund or something like that if need be.

Ever read up on the habits of self-made wealthy people? They don't buy nice vehicles until they are filthy rich and can pay cash, because its a terrible money move.

 

You have a vehicle pmt on something you don't even need and could get $22k for it, I would do that in a heartbeat.That's a lot of cash in your hand after you pay off your loan, and all the cash you free up from having no monthly pmt.

 

cvd i know thats exactly what im thinking, i just can't figure out what i want to do. If i could find a nice 95-00 first gen for a decent price, i would pull the trigger i think

 

There are many "auto loan calculators" out there on the internet. Try messing around with them, it will allow you to see what kind of impact extra payments will make in relation to how quickly (how many months of interest) you will save. If you are nearing the end of the term the amount of interest will be smaller though.

As for me, before I bought my other car, I did exactly that. I was able to project out my preferred payment schedule, and paid it off exactly on my schedule I wanted. It really allowed me to set my budget up so there was not surprises. Why yes, I haven't gotten laid in 2 months, how did you know?

 

You could wait until I get my new truck in January and buy my '96 4cyl reg cab 2wd with fiber glass tonneau cover and less than 100k milage...just saying, it will be for sale in Jan in Nebraska.

 

Have a look at this....increasing the payment by $50.00 a month, saved 2% over the period of the loan.

Over the remaining 50 months, you would have paid $2500.00...if you had done the same thing, but instead invested to $50.00, you would come out at $2,966 at a measly 10% per year!

You are just paying interest over the initial period of the loan....he's too far into the loan to make a difference.

 

i throw in a double payment a few times a year. since anything extra goes against the principle it will dramatically reduce the time left

 

The average millionaire in this country drives a 2-4 year old car or truck thats paid for. Most of them buy used. Your car should never be worth more than 1/2 your annual salary. Really, how much does one need to handle their daily chores? Unless you are a horse rancher who goes to business meetings and you need a $45k Tundra to haul horses and impress clients, most people can get away with a $10k car or truck.

A new car is a want -not a need. The only reason I financed my 2011 is because I get an average of $1k in mileage reimbursement per month through my employer and i was burning through used vehicles like underwear. After insurance and gas, I have about $700/mo left + $2-300 or so of my own money that I put on my payment. Should have a 6-year loan paid off in 2. The truck will be paid off at about 80k and probably will have cost me nothing to operate after 100k. From there, I should be able to drive it for another 100k miles easily, earning $30k after gas, payment, insurance, buy a truck $20k cash and repeat

 

Not if you buy a cheap reliable 1st Gen after you sell your truck and realize you need another vehicle. That is of coarse "if" you even need another vehicle.

 

Have you checked with your employer if they will give you a vehicle allowance instead of letting you drive their vehicle? Either way it is tax deductible for them.