Should I pay off an auto loan with free cash?

[fetish]

Here's my scenario:

I have an auto loan, 31 payments remaining at $200/month (total of $6200 owed over next 2.5 years)

Alternatively, I have enough free cash (about 13k) to pay that off - the balance on the loan is $5800. The rate is 6.99%

I would save $400 total (about $11/mo) by paying off now

I'm wondering if saving that $400 is worth it, in terms of reduced flexibility by not having that cash in reserve. Thoughts?

[frugaliknowit]

Unless your eminently going to be laid off from your job, kill the 7%!

[TheAnonOne]

Here's my scenario:

I have an auto loan, 31 payments remaining at $200/month (total of $6200 owed over next 2.5 years)

Alternatively, I have enough free cash (about 13k) to pay that off - the balance on the loan is $5800. The rate is 6.99%

I would save $400 total (about $11/mo) by paying off now

I'm wondering if saving that $400 is worth it, in terms of reduced flexibility by not having that cash in reserve. Thoughts?

The only debt worth holding is a mortgage really. Unless some other debt is A. very large, and B. at a very low rate.

The $400 you will save over 2.5 years is basically chump change, but the freedom you get from not even thinking about it is priceless. Pay it off and move on.

[ShoulderThingThatGoesUp]

At 7%? Oh yeah!

[Cassie]

Pay it off.

[NextTime]

Pay it off, and then pay your usual car payment into your savings each month.

[TheAnonOne]

Pay it off, and then pay your usual car payment into your savings each month.

Judging by the site I am on, is it even worth mentioning that he/she shouldn't just go blow the extra money on waste and bloat? :)

[forummm]

Unless your eminently going to be laid off from your job, kill the 7%!

Imminently. :)

Otherwise, I agree.

[MDM]

If you already contribute enough to get your maximum 401k match, and paying off the loan will keep your emergency fund high enough for your comfort, then add mine to the "pay it off now" vote tally.

Otherwise, it's not at hair-on-fire credit card debt emergency level so I wouldn't deplete an e-fund for this.  YMMV.