Pay off which first? Help please

Bringvaluetome

A garage looked at the coolant problem and did a leak test. They said they're no leaks. That was last week, the coolant was topped up then. Yesterday the coolant light came on and I had to top up. My gut feeling is the head gasket is on its way out. I think it would be financially better to cut my losses now and get a new car.

I won't finance and will pay for cash.

I don't care about pride when it comes to a car. Reliability and practically come first.

Bringvaluetome

In regards to trading/Investing, I have also made money. I'm a much better short seller than long.

I've made money shorting various stocks.
Tullow Oil, Cineworld & Thomas Cook.

Should I knock it on the head?

Bringvaluetome

Good news, my friend still owes me £1850 from the loan given.

Bringvaluetome

They suggested the following repayment of the £1850

11x £150 + 1x £200

monetxchange

I would knock the investing on the head until you can afford to invest money you can stand to lose. You’re really not in that position at the moment. Use the money to pay off your debt too. You’re not going to be able to get out of this situation with a good luck win - as you said yourself, you’ve had big pay outs before and they’ve been lost again on reinvestment/being spent. Look at it as the house always wins until you’re in a comfortable position.

Silver_Queen

What you are doing is gambling. You are just calling it investing to make yourself feel better.

Bringvaluetome

Thank you all for the valuable advice!

I've just put a deposit on a car and I'll be paying cash! £2450

Bringvaluetome

Wise move?

df-MRes_student

Bringvaluetome wrote: »

They suggested the following repayment of the £1850

11x £150 + 1x £200

Hi Bringvaluetome,
In your post above, you said "they"... are they speaking now then? If so, and you're happy with the repayment terms it will save you taking them to court and suing them for the balance owing. In which case, that's a good result.

I've read your posts and the replies. I too think it was a bad move to cancel your work-place pension because of the tax benefits - it's basically money for nothing! Could you not change your mind about that? Before you make a final decision I would like to recommend that you take a read of a couple of books online by David Bach (see David Bach.com), an internationally renowned financial expert, an international financial speaker, formerly a senior vice-president of Morgan Stanley and partner of The Bach Group).

I have seven of his books. They're hugely informative - just what one needs when trying to make difficult financial decisions which have long-term as well as short-term consequences. They include The Automatic Millionaire; Start Late, Finish Rich; and Debt Free For Life, to name but a few (see the BOOKS tab on his website (details above) for the others).

He goes into great detail of the financial advantages of "Paying Yourself First" and doing so automatically, which is one of his important principles (therefore having one's pension deducted from your wage packet before tax is deducted by the government). He also advises matching employer retirement contributions (Pre-tax with Employer Match) which means gains aren't taxable. He is a US-based financial expert, author and financial educator so he does talk in terms of 401K plans at times but as there are the same/similar financial tax advantages here in the UK, then the denomination of the retirement plan is of little consequence. Things are also demonstrated at times in £ pound sterling too.

You mentioned that you're 32 and would like to buy a house in the future. On page 149 of 'The Automatic Millionaire', David has a comparison table which demonstrates that making bi-weekly payments to a £250,000 mortgage instead of monthly payments will make it possible to pay it off 7 years early, in 23 years, instead of 30 years if paying once a month. This would result in a saving £119,000.00 in interest. Yes, that's one hundred and nineteen thousand pounds saving!! That's not a typo!

Consequently, I can highly recommend his books!

It was a smart move to buy the car in cash and not take on another loan, whether you have debt or not. People I know with plenty of money (millionaires included) do not take out loans for cars. They buy a car and use it until it stops working and then they replace it. I used to have a Merc and it had well over 100,000 on the clock before I had to have any work done on it at all besides the usual replacement of tyres when needed and an annual service. Someone else I know with a Merc is still driving his with over 300,000 miles on the clock. I think it just depends on how lucky you are. Some cars simply seem to go on forever. My replacement car now, a Peugeot 206, cost me just over £700 and I've been driving it for two or so years. You don't need to spend a fortune to get a roadworthy car!

Good luck with your new motor and your financial planning! It's definitely worth checking out David's books and it would be worth investing a tenner in the Automatic Millionaire and/or one or two others. You can check them out on Amazon.co.uk and use the 'read inside' function to check the index and read an excerpt of the first chapter or so.

He has free audio clips/videos etc available too (see his YouTube channel).
Good luck!

Best,

Singlespeeder

VW's have a premium. A Seat will pretty much be the same car, as would Skoda. There's all based on Golfs...
Don't discount Kia, and Toyota.