"John A. Weeks III" <john[at]johnweeks.com> wrote in message news:<240620041644596861%john[at]johnweeks.com> ...
- quote -


Hmm... well I plugged some numbers into Excel to see how things would
break down. Here's what I came up with:

1) If I continue to pay $200/month towards this card, I will end up
having paid (from today on) $2314.06 in interest, with my final
payment being 5/4/2009!

2) If I put the $3500 towards the car and pay it off, and then start
paying $500/month ($200 current plus $300 leftover from no car
payment), then I only pay $795.27 in interest with a final payment
date of 2/4/2006.

3) If I put the $3500 towards the card, then continue with $200/month
payments until my car is paid off, THEN paying $500/month (as above),
then I pay $697.67 in interest with a final payment date of 3/4/2006.

I have about a year left on the car, and the interest rate on the
credit card is 9% (USAA - not an introductory rate). My main reason
for wanting to get the car paid off soon, is because I am planning on
taking a military job at a reduced salary sometime in the next 6
months. So making that car payment is going to be rough at least for
the first 3 months of this new job, when I am projected to get my
first increase in pay.

It's a tough decision - still not 100% sure what I'm going to do, but
I do appreciate your input....

In article <81a75879.0406241123.f511b91[at]posting.google.com> , Peter
Gibbons <bravodelta73[at]comcast.net> wrote:

- quote -

Pay off the credit card debt first. Once you are done with that,
then pay off the car loan. The reason is that the car loan is
a pretty safe (but expensive) animal--you know what the payments
are, when the due dates are, and left alone, it will be paid off
shortly anyway. But the credit card is a beast in and of itself.
Those teaser rates are going to expire leaving you with very
high rates. And if you miss a payment, have a check bounce, or
your payment gets lost in the mail, these low rates suddenly become
something like 29.999%. Not only that, but most cards now share
your payment info, and if you are late or over limit on one card,
the other cards that you are current on also blow up like this.
That is too risky of a thing to deal with, so get rid of it.

I am also concerned about how you got $9500 in loan shark debt
anyway. That is usually an indication that you spend more than
you earn. If that is the case, you have to solve that problem,
or you will just end up back at $9500, but now no longer have
that little nest egg to tap. If you fix the spending problem,
everything else will fall into place.

-john-

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John A. Weeks III 952-432-2708 john[at]johnweeks.com
Newave Communications http://www.johnweeks.com
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I'm hoping you guys can give me some advice. I have about $3500 in a
money market account that I'm wanting to use to pay off some debt.

My choices are:
A) Leave it in the Money Market
B) Use it to pay off my auto loan (about $3500)
C) Use it to pay part of my credit card debt (about $9500)

My thinking is to get the car paid off because then that would free up
about $350/month that I could then put towards paying the credit card
off quicker.
I don't remember the interest rate on the card, but I know it isn't
that high (maybe 4-5%).

So - would paying off the car first be a good or bad idea?