Hello all!
Boy, I need some advice. I purchased a 2011 Ford Edge a few months ago before discovering MMM. Wow, had I just found this site just 2 months before the purchase...
sighsSo here is my situation:
Ford Data:
- Loan left on Ford Edge: $25,700 @ 1.5% APR
- I did buy the pre-paid maintenance and repair package
- Trade-in Value: $17,900
- Monthly Payment: $500
- Miles on car: 31.5 K
- MPG in City: I am averaging 17.5
Personal Data:
- I am single, 42, no kids.
- I drive mainly in town (buying a bicycle next week or so for errands - about 75% of my driving is within 2.5 mi., except for church, which is about 10 mi away)
- I work from home 4 days a week, drive 63 mi into office 1x a week, or 1x every 2 weeks, depending.
- I drive to weekly dr appt's 2x a week - 35 mi each way.
- Neither commutes are currently negotiable.
- I currently have no cash reserves left, as I just paid off the last of my CC debt this month with what I had left.
So, given the tenets of Mustachiansim, I would like to get rid of this beast I am buying, and get a cheaper car, with better gas mileage. I was thinking of something along the lines of a Toyota Prius.
Prius Data:
- 2005 Model
- MPG: 60 city (I could weep. this is over 3x my current mpg)
- Miles: 116k
- Price: $8900
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I would love to get some ideas and feedback on fixing this. I realize I will have to eat the 7k differene on the Ford.
Given all that data, and given I have no cash reserves right now, here is what I was thinking:
BofA Visa has a 0% APR for one year on balance transfers. So what I though was:
- Write check from Mastercard to cover the 7k loss on the Ford.
- Purchase car on MasterCard (I could prob find for about 8k).
- Transfer both to Visa for 0% APR.
- This would give me a 15k debt on the car, but I would be saving 10k over finishing paying for Ford, and I would save a ton on gas - prob around $150/mo.
- If my tax refund and bonus at work hold the same as last year, I would get a total of 13k around March, which I can use to pay off the Prius and the 7k loss.
- I would be aggressively paying the car in the meantime (1-1.5k / mo)
Is this a good plan? Is it insane and do I deserve a punch in the face?
Any help you guys can give me would be greatly appreciated - because of this site, I have paid off all my CC debt in record time, and I want to get the car situation handled before I start aggressively saving again, and start looking hard at my current house purchase / mortgage.