Save or pay off auto loan??

I would like to construct a debt-free (except home) plan for the year. I currently have an auto loan that I owe $7,000 on. The auto is a 2003 model. I'd like to pay off this debt because my car has 70,000 miles on it - and I'd like to have money for car repairs should anything happen to it. (Knock on wood).

I can't afford a car note and a mechanic...but I can save tax returns, bonuses, and so forth to try to get this debt out of the way. Any thoughts? Ideas??

Save or pay off auto loan??

Pay off the car loan. Put whatever you can onto it and get rid of it. The earlier you put money into that loan, the sooner it'll be gone and you can concentrate on the homeloan.

Saving your tax returns and bonuses and pumping them into this loan is a great idea. This will give you a head start.

See if you can shave a few more dollars off your budget. If you work out what your bare necessities are, then you can use that to work out how much you can afford to tip into the loan. Things like buying your washing powder in bulk, taking your lunch to work, (I make curries and pasta and freeze them in plastic containers, and make sandwiches) can save you hundreds every year. Take 3 minute showers, use energy efficient light bulbs, and even consider renting out a room in your house to someone if you can afford the space. That's my contingency plan if my income goes and I need to keep up the house payments.

Get rid of the debt first, and then use the habits you've developed to kickstart your savings.

If you want some more specific advice about saving money around the home, feel free to email me. I don't mind.

Save or pay off auto loan??

It depends on what your interest rate is. If it is low, I would say just keep it so you have a little more flexibility in your budget.

You can pay on top of your prinipal to help pay it off faster. I would say keep making the payments and pay more if your rate is below 7% or so, if it is higher try and pay it off quickly so you don't continue to pay a ton for interest.

Save or pay off auto loan??

If it were me I'd pay off the auto loan. Gives you more money to put away as soon as its paid off.