Well I have successfully paid off my car loan. Actually just awaiting the title in the mail right now. And it feels good. Well actually I have transferred the entire balance of $22,000 to credit card 0% offers in order to reduce the amount of interest paid over the next year. I know it is risky but I have carefully thought this over and examined all the risks before making the final decision.

Considerations/Risks
Risk: Credit Report – I have delayed plans to save for a downpayment and buy a house due to the amount of debt I hold. With my repayment plans I have no need for applying for any type of credit since I have a relatively new car, and am not looking for a mortgage for 3+ years. The huge hit to my credit score does not matter to me.
Risk: Repayment – Loss of Job – My job is pretty secure. So I’m hoping I have no worries for this. As a backup, if anything drastic were to happen I could sell my car to payoff the balance transfers. If I lost my job I wouldn’t be able to afford it anyway.
Repayment – Overspending so there would not be enough saved at the end of the promotional offers. This is what I’m most concerned with. As I’ve tried having a budget for the past year, and have never once been able to stay within it for a month (in any category!). If I really need to I can tap my $2,500 Emergency Fund when 12 months is up and then build it up within a month or two. So I’m 50/50 for my feelings on this one.

Well, I chose my car to use the money towards since I can always sell it if anything goes wrong, and not have to pay the back interest. I have a detailed spreadsheet covering the next year of extra savings and minimum payments to ensure I will always have enough money for minimum payments along with the full amount for payoff at the end of the 12 months. With this I’ll be able to sense if I’m heading towards failing and change my habits.

Now I have been thinking about selling my car in order to expedite my student loan payoff. At the moment I am still undecided. Yes, I know its insane to have 25,000 loan for a car when I already have 175k in student loan debt (combined with fiancé). But its difficult to stomach the depreciation in 18 months. And the low-ball values that the guides are giving me. I mean I knew there would be new car depreciate but is a $9,000 depreciation over 18 months reasonable? I think I’ll at least wait out the market a little or wait until spring since it is a convertible and I can get a more decent price.

Also, I’m thinking about waiting to sell until I either relocate for work or move apartments at the end of my lease in August. Then we could move to an apartment close to one of our works and possible downsize to one car. I’d be more willing to sell if I didn’t have to then buy a car immediately after. Time will tell on this one.

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