Best use of 16.5k lump sum

m0ns00n

browniej wrote: »

How will you pay for the next car then? I thought you were planning on using the money saved by paying off the car loan towards the 20% deposit?

A few reasons why I should be able to do this:

1) Planning to buy a cheaper car next time (I reckon I'll only need a few grand based on the expected residual value of my current car)

2) I should reach the amount for a 20% deposit before buying the next car. I can therefore put the money back to a car savings account

3) I'm already significantly overpaying on my current mortgage, so shouldn't need that cash to afford the larger mortgage.

browniej

m0ns00n wrote: »

3) I'm already significantly overpaying on my current mortgage, so shouldn't need that cash to afford the larger mortgage.

I'll assume you either meant larger deposit or smaller mortgage.

Good Luck with your plans.

m0ns00n

browniej wrote: »

I'll assume you either meant larger deposit or smaller mortgage.

Good Luck with your plans.

Sorry, I'll clarify that a bit. I'll need to save the car loan initially, in order to reach the larger deposit.

What I then meant, was once I have the mortgage, I won't need to use that saved car payment to pay for the monthly mortgage payment, as the amount I currently overpay by should be sufficient to cover it.

I can then use what would have been the car payment to save towards my next car.

Thanks for the advice!

grey_gym_sock

never borrowing except for a mortgage is the way forward

atush

m0ns00n wrote: »

Yeah, good advice! I got a £2k reduction on this car as a new model was due out a month later (which is virtually identical, save for reshaped headlights). Was still a brand new car which was nice

Impluse control. you bought something you wanted but didn't need. So don't do that anymore.

m0ns00n

atush wrote: »

Impluse control. you bought something you wanted but didn't need. So don't do that anymore.

Well, I did need a new car (old one was starting to cost me a fortune in servicing). Probably not such an expensive one, but there you go.

To be fair, if I only bought things I actually needed, I'd probably be living in a 1 bedroom flat and be mortgage free!

I think there's a balance to be struck between buying what you want and what you need. Life is to be enjoyed after all, and usually that involves spending a bit of money.

This was the first time I'd ever borrowed money to fund the purchase of something (mortgage excluded). I've now decided it's not something I really want to do again, so paying off the loan is certainly a good step forward