I'm fixing to get a settlement soon and was wondering which way I should go. Do I pay my house off completely and put some money in my kids college and a emergency fund and still have my two car notes. Or do I pay both cars off and put the remaining on the house and have no emergency fund. Any help would be nice.
SVTP investment gurus come on in..
- Thread starter GoneNsixty
- Start date
Well I guess this all depends on how much you are getting... personally I would pay off the cars because this will give you more income from paycheck to pay check. I would then keep at least 10-15k for an emergency fund and pay the rest towards your house.
But then again this all depends on how much your getting... my opinion could change depending on how much.
But then again this all depends on how much your getting... my opinion could change depending on how much.
Buy a Lamborghini.
No way, he should get one for Christmas
Personally, I would sell the house since it's basically a investment, cars are not. Pay the house off, pay for your kids college and the rest in savings/emergency.
Here is really what you should do: talk to your financial planner and invest it. think of it this way, if you pay off the house and your interest rate is 6% on your loan, you would be better off investing and over time making 10%-30% (or more) on your money. Same thing with auto loans...if you are paying 8% interest on your loan, you can invest the money and over 5 years make more than 8%, thus coming out ahead in 5 years. Make sense?
Get your emergency fund, pay off the cars then use money that was allocated to car payments to begin investing and paying off the house.
Thanks guys keep it coming.
Rush
Banned
Pay the house off, save the rest and start a business.
1). Pay off anything High Interest - Credit Card, Car Loan, etc.
2). Get a copy of your credit report and pay off anything outstanding or in collections you might have forgotten about
3). Take a look at any items you make monthly payments on that you could just pay off to bring in more every month. Home / Car Insurance Payments for example
4). Whatever the remaining balance, take 2-5% and blow it on something fun (vacation, car parts, booze/strippers, etc.)
5). Put 10-15k in your savings account for a rainy day
6). Now talk to a financial advisor and invest anything remaining, 75% in low risk ventures, this will yield 2-4% which you can reinvest or replenish savings with. Put the other 25% in medium risk investments.
Good Luck and just take your time and think things through. Most people who come into money have no idea what to do with it and end up blowing it.
:beer:
2). Get a copy of your credit report and pay off anything outstanding or in collections you might have forgotten about
3). Take a look at any items you make monthly payments on that you could just pay off to bring in more every month. Home / Car Insurance Payments for example
4). Whatever the remaining balance, take 2-5% and blow it on something fun (vacation, car parts, booze/strippers, etc.)
5). Put 10-15k in your savings account for a rainy day
6). Now talk to a financial advisor and invest anything remaining, 75% in low risk ventures, this will yield 2-4% which you can reinvest or replenish savings with. Put the other 25% in medium risk investments.
Good Luck and just take your time and think things through. Most people who come into money have no idea what to do with it and end up blowing it.
:beer:
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I'd pay off the car loans and any other debt, at least with the mortgage the interest is a tax deduction.
Calculate the interest that you will pay over the remaining life of the home loan. When you see how large that figure is, you may want to pay off the mortgage.
JPro's advice is sound but it rests on a 'maybe' of your investments returning more than you would save by paying off the mortgage. Personally I would take the safer route.
JPro's advice is sound but it rests on a 'maybe' of your investments returning more than you would save by paying off the mortgage. Personally I would take the safer route.
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Car loans and CC debt first. Those you cannot write off.
always have a descent savings. id compare your interest rates to what rates will be on certain investments and go from there. me i like having no bills or as little as possible and have a couple yrs in savings.
Follow the steps...
:rockon:
Real Debt Help - Get out of debt with Dave Ramsey's Total Money Makeover Plan
Baby Step 1
$1,000 to start an Emergency Fund
An emergency fund is for those unexpected events in life that you can’t plan for: the loss of a job, an unexpected pregnancy, a faulty car transmission, and the list goes on and on. It’s not a matter of if these events will happen; it’s simply a matter of when they will happen. Learn more
Baby Step 2
Pay off all debt using the Debt Snowball
List your debts, excluding the house, in order. The smallest balance should be your number one priority. Don’t worry about interest rates unless two debts have similar payoffs. If that’s the case, then list the higher interest rate debt first. Learn more
Baby Step 3
3 to 6 months of expenses in savings
Once you complete the first two baby steps, you will have built serious momentum. But don’t start throwing all your “extra” money into investments quite yet. It’s time to build your full emergency fund. Learn more
Baby Step 4
Invest 15% of household income into Roth IRAs and pre-tax retirement
When you reach this step, you’ll have no payments—except the house—and a fully funded emergency fund. Now it’s time to get serious about building wealth. Learn more
Baby Step 5
College funding for children
By this point, you should have already started Baby Step 4—investing 15% of your income—before saving for college. Whether you are saving for you or your child to go to college, you need to start now. Learn more
Baby Step 6
Pay off home early
Now it’s time to begin chunking all of your extra money toward the mortgage. You are getting closer to realizing the dream of a life with no house payments. Learn more
Baby Step 7
Build wealth and give!
It’s time to build wealth and give like never before. Leave an inheritance for future generations, and bless others now with your excess. It's really the only way to live! Learn more
:rockon:
Real Debt Help - Get out of debt with Dave Ramsey's Total Money Makeover Plan
Baby Step 1
$1,000 to start an Emergency Fund
An emergency fund is for those unexpected events in life that you can’t plan for: the loss of a job, an unexpected pregnancy, a faulty car transmission, and the list goes on and on. It’s not a matter of if these events will happen; it’s simply a matter of when they will happen. Learn more
Baby Step 2
Pay off all debt using the Debt Snowball
List your debts, excluding the house, in order. The smallest balance should be your number one priority. Don’t worry about interest rates unless two debts have similar payoffs. If that’s the case, then list the higher interest rate debt first. Learn more
Baby Step 3
3 to 6 months of expenses in savings
Once you complete the first two baby steps, you will have built serious momentum. But don’t start throwing all your “extra” money into investments quite yet. It’s time to build your full emergency fund. Learn more
Baby Step 4
Invest 15% of household income into Roth IRAs and pre-tax retirement
When you reach this step, you’ll have no payments—except the house—and a fully funded emergency fund. Now it’s time to get serious about building wealth. Learn more
Baby Step 5
College funding for children
By this point, you should have already started Baby Step 4—investing 15% of your income—before saving for college. Whether you are saving for you or your child to go to college, you need to start now. Learn more
Baby Step 6
Pay off home early
Now it’s time to begin chunking all of your extra money toward the mortgage. You are getting closer to realizing the dream of a life with no house payments. Learn more
Baby Step 7
Build wealth and give!
It’s time to build wealth and give like never before. Leave an inheritance for future generations, and bless others now with your excess. It's really the only way to live! Learn more
I'm no investment guru but I try to pick up at least 4 or 5 rental properties a year. Been tough lately though with the market the way it is. My properties went from about 3.5 million to about 2 million. Ended up having to sell the veyron AND the enzo. Only thing keeping me on my feet right now is my sleep clinic which brings in about $14k /night. Bad times indeed...
Were you not able to pay for your cars with cash money? :shrug:
oke:
Only thing keeping me on my feet right now is my sleep clinic which brings in about $14k /night. Bad times indeed...Were you not able to pay for your cars with cash money? :shrug:
oke:
Thats a tough one and there are some good suggestions here. You could pay off high interest items and or house. You could save it all and have peace of mind with money in the bank and assurance that the bills will get paid. Or you could split it all up in many ways: debt, investments, and savings.
I wish I had this difficult question facing me, but I also dont know the reprocussions of getting this 'settlement'.
Good luck with your decision.
I wish I had this difficult question facing me
, but I also dont know the reprocussions of getting this 'settlement'. Good luck with your decision.
Thanks so much guys. Trust I wish I wasn't in line to get the "settlement" but oh well. I think I'm going to pay the house off, put a chunk in savings and college fund and blow 2k. Then the money I'm saving on house I'm going to double up on the cars and pay them off in a year and half..... Then no notes...... May not be the perfect way but no house note I think would be sweet! I don't have credit cards or anything all I have is a house and two car notes.
Pay off starting with the highest interest rate first.
not quite....mortgages are compound interest and not simple interest
a house payment is the highest interest loan you can have...its nearly 100% over the life of the loan (i.e. a $150k house ends up costing you $300k).
pay the house off first
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