Ok anons, I've gotten wrapped up in some debt.$20,000 car payment $550mth$10,000 401K Loan $225mth$5,000 401K Loan $225 month$5,000 home(HVAC) loan (0%)I cut food spending, broke up with my GF, and I'm working overtime.Means I have $2,000 a month to pay off shit.Should I start with the smallest loan first, then use that saved money to help pay off the largest ones?Or go straight to the more expensive Car loan since 401K loans have basically zero interest.
>>61031100Pay down whatever has the highest interest rate first. Remember that a portion of all you earn is yours to keep, regardless of what you owe.
>>61031100Get rid of your car and spend the first $2000 buying a car in cash.you should be able to clear the rest in 1.5 year..
>>61031100high interest loans first, put the psychology of wanting to clear smaller loans aside. also what the fuck is a 401k loan
>>61031193this is correct answer from a math perspective.david ramsey's claim to fame on smallest amount first is that it feels better emotionally and the small wins make you want to continue. i can see that being true for some people.
>>61031100Follow the avalanche method. Pay the highest interest rate first and eliminate that. Then roll that amount you were paying into the other loan and keep going that way. The faster you pay it off, the more money you save and can keep for saving. Once everything is paid off, pretend like you still have a car payment and keep that money in a savings account to build up for when you inevitably need another car. Never buy another car with a car note. Stick to cash. New cars are garbage and poorly built anyways. A car note is the #1 way to keep you from achieving financial comfortStick to low cost meals for a few months and get good at cooking at home. You can meal prep your own burrito bowls or teriyaki bowls. Those last me 4-5 days. Other dishes that I can meal prep for cheap (<$20) are pasta with meatballs, lasagna, chicken sandwiches, halal bowls, and fajitas. I got really good at cooking and make better food at home simply by watching YouTube
>>61031371I've noticed Euros ask this question a lot.Do y'all not have access to retirements funds?
>>61031371>>61031378>>61031402>>61031100401K loans more important OP.Any money pulled from your 401K is losing compound gains over 30+ years.Means a lot more money lost than 6% interest on a car loanPay off 401K loans first.Pay off the car, & then the house AC shit.
>>61031100nice work keep at it
