So, now that I’ve paid off my car loan, it’s time to re-examine my personal finance goals.
First, a fun fact: When you pay off your car loan they send you the title to your car. So I got my title in the mail last Thursday! Even funner fact: my roommate got her title in the mail the same day! What are the odds?
My next debt to tackle: Student loans.
Changes I plan on making to my finances:
Every month, I had paid my car loan with an automatic transfer from my ING checking account. I’d also transfer a slightly higher amount into that ING checking account every month. So I’d be slowly stashing a little bit of extra money into savings. Now that my loan is paid off, I’m going to set the monthly transfer to go to my Down Payment Fund instead. This means I earn a little bit extra interest-wise. Plus I’m still keeping the money out of my main spending account.
As is customary in personal finance, I’m now going to pay the amount I paid on my loan each month towards my student loans.
Overall, this means that a different account gets my monthly savings transfer, and a different account gets my monthly loan payment.
Technically, all the money will be leaving my main checking account now (just the way things are in my current system). But this means I’m still putting money towards a down payment, while paying extra towards my student loans.
Is this the wrong approach? Should I be working harder to just eliminate my student debt instead of saving for a house?