Hello – I just want/need to hear some prospective. Sorry this is long but I want to give all the details.
My situation: I graduated about a year ago with $55k in student loans. It’s always been my intention to pay those off “quick” or as quick as possible. So far I’ve paid off $15k, and I plan on paying at least 10k more before the payments will resume (so no additional interest will accrue until then). I have very minimal living expenses as me and husband paid off the house we live in. I make $55,000, husband makes low 6figures but we don’t share our finances (we share some house expenses, but I pay my own bills)
Long story short, I drive a 17yr old Toyota with 200k miles on and it’s quite unsafe to drive at this point. I really want to get this new car I saw, fully electric, in the 20k range ($400-500 monthly payment) but I keep feeling guilty about it because my student loans are still outstanding and this will slow the repayment down.
I do work from home and we have another family car, but I still need to go to the office and run errands a few days out of the month.
Is this a stupid move? Should I stick with my old car and be patient until I’m debt free?
Not stupid at all to replace your aging car with a newer one that’s more reliable, efficient, and safer.
However I would look at your overall finances, do you keep 3-6 months expenses for an emergency fund and have you been working to max out your retirement accounts? I’d make those two your top priority before a new car or even paying student loans.
ROI…
About what it would cost to get an extra 50 – 70 k out of what you have vs going deeper into debt.
A $20k new electric car? What car is this? Anyway this doesn’t seem like a bad buy. There’s also no particular reason to be paying loans off while they are suspended. What if part of it gets cancelled? I don’t think that’s fair or smart to do by the government but hey if it happens might as well benefit from it right?
How much would it cost to make the car safe?
If you can get it fixed, a Toyota with 200k miles on it is nothing, even at 17byears old. I’d keep it til it stops running and out those payments towards your loans when they resume.
An unsafe car is unfair to others with whom you share the road. Unless you’re indigent, you should replace it.
That doesn’t mean you should get a brand new car. Buy a used one (if you can find one :S). Forget electric cars. A plug in hybrid will be easier to find used and just ad good (if not better) for the environment
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