Author Topic: what to do with me $13,000 check...  (Read 4649 times)

FuckRx

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what to do with me $13,000 check...
« on: October 25, 2013, 03:57:48 PM »

i just sold my condo! very excited, got 13k from the sale...
i have emergency cash stowed away already...
no mortgage payments, i'm renting...
i have a car i'm leasing that i have finally decided i will keep, it would cost me 12,800 to buy the car...165/mo for the lease...
i have 11,800 in a credit card, 0% until end of next year...
i have 12,100 that i borrowed against my 401k 2 years ago, they automatically take out 160/mo from my paycheck for the repayment...
and another 115,000 of student loans...
i have 100k in my retirement account...
i'm 35 yo...
what's best to do with the money

chasesfish

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Re: what to do with me $13,000 check...
« Reply #1 on: October 25, 2013, 03:58:36 PM »
Kill the 401k loan is my vote

iamlindoro

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Re: what to do with me $13,000 check...
« Reply #2 on: October 25, 2013, 04:07:12 PM »
i have a car i'm leasing that i have finally decided i will keep, it would cost me 12,800 to buy the car...165/mo for the lease...

Don't do that!  Get the hell out of the lease and spend 4-6K on a decent and fuel-efficient used car.

i have 11,800 in a credit card, 0% until end of next year...

Will it be completely paid off before the interest rate rises?  ie, are you putting $850/month towards it right now?  If not, then pay this down to the point where you can/will be completely paid off before the rate balloons.
« Last Edit: October 25, 2013, 04:09:15 PM by iamlindoro »

Another Reader

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Re: what to do with me $13,000 check...
« Reply #3 on: October 25, 2013, 04:17:35 PM »
In your shoes, I would pay off the credit card or the 401k loan.  And I would take the next couple of months' excess salary and pay off the one I did not pay with the sale proceeds.  You should be completely debt free in a couple of years, as long as you keep the cheap car and the $800 apartment.  After that?  How many years to FI?

FuckRx

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Re: what to do with me $13,000 check...
« Reply #4 on: October 25, 2013, 04:21:29 PM »
yes i can definitely pay off that credit card by next year...

see, i'm worried i'm gonna get penalized for ending the lease early. the company couldn't give me any info on it!

apennysaved

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Re: what to do with me $13,000 check...
« Reply #5 on: October 25, 2013, 04:27:12 PM »
I would highly recommend paying off the 401K loan because it is my understanding that if you lost your job, then you would be required to pay it back immediately or face early withdrawal penalties and taxes.

A few years back I was forced to find a new job when my company was downsized and had to pay back my 401K loan.  Fortunately, my parents loaned me the money to pay it back, but not a scenario I would want to be in again.

Next I would focus on a way to get out of the car lease which many people on this forum will see as a waste of money and try to purchase something inexpensive, but reliable.  You have a lot of debt, so the car seems expensive based on the debt load you have.  Not sure how much is in your emergency fund & if it could help in this situation and I don't understand why the car company can't give you info on the extent of penalties, but it is hard to assess the situation without that info.

Then, I would try to pay down the CC as fast as possible before the interest rate increases.

Insanity

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Re: what to do with me $13,000 check...
« Reply #6 on: October 25, 2013, 06:28:37 PM »
401K loan is a definite to payoff first.  Even if you think your job is safe. 

oldtoyota

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Re: what to do with me $13,000 check...
« Reply #7 on: October 26, 2013, 10:18:57 AM »
^^^ Push them on this. Of course they don't want you to end the lease. Tell them you can't afford it anymore and it either needs to go, or you'll have to start missing payments. I find companies get more receptive at that point. Just don't let on that your definition of "can afford it" is different from the rest of their customers.

Aren't you a doctor? If so, you might want to temporarily remove your LI profile so they don't google you and think you can afford it.

FuckRx

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Re: what to do with me $13,000 check...
« Reply #8 on: October 26, 2013, 10:34:38 AM »
wow, do they go to that extreme? i don't know if i can lie to them either... but i'll have a convo on the phone with them again and see what i can get out of them

FinancialIndependenceTime

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Re: what to do with me $13,000 check...
« Reply #9 on: October 26, 2013, 06:31:40 PM »
Eradicate that 401K loan ASAP!

If you lose your job you WILL have to pay that back instantly...