[loki.fish]

So here's the deal. I decided I wasn't gonna spend much money for a while and pay off my car a year (give or take a couple months) early. I've got the payoff amount ~$3,050, which is 3 months of doing nothing but sitting at home doing nothing, and had the itch for some new guns.

So, what would you guys do? As the majority of you are older and wiser than I, I'd like to hear your opinions.

[Nortonics]

Hahahahaha!

The same question men have been asking themselves for..., well, forever! It's like the little Saint on one shoulder, and the little Devvil on the other, each wispering in your ear. I feel for ya buddy...

Hahahahaha!

[dragongoddess]

Pay the car off. So says granny.

[Josh Aston]

Pay the car off. Then use the money that would have been going to car payments to buy guns.

[Sylvan-Forge]

Pay off the car, stop funding the globalists ;)
(Interest and all that)

[AirForceShooter]

learn to live with having to wait for stuff.
When you get it, it's that much sweeter.
Pay OFF the car!!

AFS

[buck00]

I'll say this to play devil's advocate:

When I look back, I bought some of the guns I own during very lean financial times (years ago). For one reason or another, I scraped together the money and bought certain guns when something caught my eye. In many cases, the price of that gun ended up doubling or tripling since then, and I would probably never buy it today. Or in other cases, the certain gun became very scarce due to supply/demand or political issues. I'm sure we can all think back on "the one that got away."

So, I would support my fellow THR-ites and say "pay off the car" but at the same time, keep yourself flexible and open to buying something if it comes along at a great price. Often, your finances ebb and flow, but a great gun (especially a rare one) often only comes along once.

[hso]

Pay off any debt you have and you'll have those monthly payments in your pocket for toys instead of the bank.

[moredes]

Common wisdom regarding prudent financial security says that one should have six month's (gross?) income saved away at all times for the unanticipated emergency. Someday, it will be needed. If you haven't got that, I'd salt it away in some kind of interest bearing account or a CD or mutual, and build that account up until you do. If you've already got that covered, I'd pay the car off, and split the amount of the car payment--50% towards savings (not a bank savings account--they're one of the poorest "investments"), and the remaining 'uncommitted 50%' towards the next toy. (All monthly 'recreation costs' ought t to come out of that "uncommitted 50%"). Akin to the economic theory of 'guns and butter', one can either spend for toys, or for retirement comfort--early retirement, budget-free retirement, etc, or toys now. I retired at a very early age, having tempered my recreational needs with a 'guns and butter' type of outlook--I didn't outright deny my penchant for toys, but I alloted myself a budget and stuck to it after fulfilling all the "financial security" requirements.

Just saw Buck's post:
So, I would support my fellow THR-ites and say "pay off the car" but at the same time, keep yourself flexible and open to buying something if it comes along at a great price. Often, your finances ebb and flow, but a great gun (especially a rare one) often only comes along once.

I think I agree with his full posting, but not wholeheartedly; certainly there are times when one hears of a great deal not to be passed upon, but there will always be another ship coming to dock. You'll never permanently 'miss the boat'. If there comes a time when one truly sees that kind of opportunity, my advice would be, get a loan. Use the bank's money to finance it; even if you have to secure the loan first to rejuvenate your bank account after spending whatever the 'deal of the century' cost. Sure, you have to pay interest; but consider the interest part of your "financial stability" fee.

Ain't no doubt, I've done what Buck's done--I've spent "hand to mouth" money for a toy I just knew would cost 'way too much later, and I survived the episode, but that doesn't mean it was either smart nor prudent. If something terrible had happened, I'da still had to do what I'm counseling---get a loan. The difference is, with no collateral ("money in the bank"), finding a loan when you're 'hand to mouth' can be awful tough.

[Cueball]

Pay off the car, it's only 3mos. Then start stocking up on guns!

[WayneConrad]

If you're on the tail end of the loan, you'll save very little in interest charges by paying off the loan. It's worthwhile to do the math and see how much. It could be that you'll get a better return in the ~5% interest rate you can get from an online bank's savings account, and certain that you'll do better in an index fund or other conservative investment.

Just making up some numbers, a 20k, 24 month, 12% interest loan is costing you about $56 dollars in interest in the last 3 months. By this time, the piper has already been paid.

In a savings account with an annual rate of 5% APY, compounded daily, over 3 months your $3050 will yield about $38 in interest.

It's a pretty close contest. Of course, if you can stand to let your money stay in the savings account, you'll have earned around $150 in interest at the end of a year. Doesn't that sound sweet?

A low load index fund can get you ~10% over the long haul. If it's money you don't mind sitting on for at least 10 years, sock the $3050 in the Vanguard index fund and the odds favor you getting much better yields than the savings account or the loan payoff.

Here's the firehose you want to drink from: Fool's School (http://www.fool.com/school.htm)

(Edited to add): $150 is a whole milsurp. The more you invest, the more guns you get to have. You can't lose!

[knuckles]

Nah! Sell the car, walk to work and buy an arsenal... ;)

Like my tags?

[Sylvan-Forge]

Folks, he said about a year, not 3 months ..
:neener:

[Hazzard]

I'd pay off the car. That gives you the payment amount each month to save towards firearms and reduces your household debt. I hate being in debt!

[LightningJoe]

More shooting is better than more guns. Unless you've made spectacularly bad gun selections, you probably own the guns you need. Now, shoot them.

[DWARREN123]

Pay off the car!

[ORAG]

I would not have bought the car on payments in the first place. I buy what I can afford to buy in cash. Pay off the house, max out the 401(k), IRA, Keohs etc. I have a couple of guns and keep the well maintained. I ride a recumbent bike for exercise and smile all the way to the bank. BTW, it took me only 30 years of hard work and saving to get ahead.

[WayneConrad]

"Folks, he said about a year, not 3 months .."

In my best Emily LaTella voice: Never mind!

[Exmasonite]

I'd say pay off the car and get out of debt, toot sweet.

now... i personally don't think it'll happen but some people have mentioned the concern about a new weapons ban if the liberal sweep congress, etc. If you share that concern, might be nice to make some choice additions to the arsenal (AR's, AK's, if they're on the list). I'm not worried about that.

[Ala Dan]

I agree, pay your ride off first~!:cool:

Then you won't have too worry 'bout spending any excess cash on guns.:D

[hksw]

Paying off debt is always good for you in the long run. (halo/:))

However, when the next election comes around in '08, you'll only have a short amount of time (after paying off the car) to gather all of the guns that will be banned when the next gun banner gets into office. Plus, guns won't be cheaper in the future. :evil:

[Myself]

It depends on what other debt you have and how much of the payoff figure is interest. It is quite possible that of the remaining debt on your car very little is interest if your loan bunched the interest portion of your payments in the begining of the loan term. Add up the total of the payment coupons and compare that to your payoff figure. If the difference in insignificent (divide by principle for %) then you will save very little by an early payoff.

I hate debt and will always advise paying early except when the money due is basicly interest free. Do you have other debt that has higher interest charges that should be paid first? When the debt is down/gone you will have much more for toys.

[waynesan]

It all depends on when you are going to die. If you are going to die before the car is to be paid off, then use your money and buy the guns you want now and have a ball blasting away until your termination day. Your heirs can then fight over who gets the guns and car you leave behind. If, on the other hand, you do not pass away before the car is to be paid off, you would be wise to pay it off and then work on adding to your collection. So, when ya dying? Hope this helps.:D

[va_1168]

No help whatsoever but highly amusing nonetheless, Waynesan. (LOL, that's killin' me here... :p)

To be serious for a moment, you gotta go w/ dragongoddess and others who say pay off the car. You won't regret getting that burden out of the way.

If you want more guns badly enough of course you could sell that car, pay it off, get a cheaper one, and end up w/ more $ for use right now. ...Er, that wasn't one of the choices? Whoops, sorry, nevermind... :D

[M2 Carbine]

Pay off the car.
Then work toward getting/staying totally debt free.

Once you get to the point where you pay cash for everything you will be surprised how much money you have, since every month you aren't throwing a good bit of your paycheck in the toilet in the form of finance charges.

I'd guess that the average person is, in effect, buying a very fine pistol or rifle for the finance company every month or two.:(