Before discovering the ways of Mr Money M, I made a big un-mustachian purchase: a luxury sports car via 5-year financing payments in order to get girls.
While successful for its original intent, I now would like to move on to a cheaper and more efficient vehicle, especially due to my 50-minute-each-way daily car commute.
I have never sold a car that I didn't 100% own, so I am having trouble working out the particulars of the money-shifting necessary to make this change, which is where you come in.
Details:
The payoff quote for the car is around $22,500.
My payments on it are $480/month.
Payments go until 08/05/2019 if not paid off early.
Loan interest rate: 2.19%
EDIT: I can sell my car for around $32,000 privately. /EDIT
I intend to buy some Honda or Toyota sedan for around $8,000-$10,000.
I have about $6,000 in my checking account.
I have $76,000 in my taxable Vanguard index fund portfolio
It would be nice to use the taxable Vanguard portfolio to loan that money to myself to payoff the loan, get the title from the bank, sell the car with its title, buy a new car, and put the remaining cash back in to the Vanguard portfolio. However I'm thinking this would result in a big capital gains tax and messy tax work next April. (I could be wrong). Also keep in mind that due to the job/commute, I must have at least one car at all times so I can get to work.
So what's the proper sequence for financial success in my situation? Hopefully this is an easy one.