Ok, I have been on a venture to become debt free, including mortgage, so that I can save up a huge downpayment and move to a nice, big house in a good neighborhood. I am about 2 weeks away from becoming credit card debt free. I have 2 cars, one is a very reliable Honda Civic that I only owe 4500 on, and I have a 07 Dodge Ram that I owe 17k on. I owe 115k on my house. If I were to sell the truck I would free up 17k in debt and nearly $400/mo in payments- and I would come out with probably $3000 cash after selling it (nearly enough to pay off the Civic). However, I love my truck and I would hate to part with it. Is it smarter to sell it now and try to become debt free as quickly as possible and just buy another truck that I love with cash in the future? I know becoming debt-free takes sacrifices, but is it worth selling my 4×4 in Colorado to become debt free first?
Keep the truck and pay it off or sell it to get closer to being debt free?
28
Mar
David Z
March 28, 2010 at 10:15 pm
yes sell it. plus your insurance goes down.
mama_sayed
March 28, 2010 at 10:57 pm
Keep the truck. After you have eliminated the credit card debt, take the amount you have been paying them and add it to the payments on the Honda, to pay it off more quickly. Once the Honda is paid off, you can use those payments toward paying off the truck. When that is done, all your payments should be put toward saving for the new house. It takes time, but it is really the easiest way to get where you want to be financially.
G. Whilikers
March 28, 2010 at 11:20 pm
If you haven’t scratched the paint or towed a boat in the last two years, sell it and buy a giant belt buckle. It’ll do the same thing your truck has been doing for a lot less money.
All kidding aside, getting both car payments out of the way or saving a bit to buy a decent used truck is a good way to start.