Paying Off Debt – I Paid Off My Car Note

I just paid off my car note. I can’t tell you how that feels, other than great. I purchased a Z4 BMW back in 2006. My monthly payments was $550 per month. Aug 15, 2009 I made my last payment, although I was scheduled to pay until Oct 2010. How did I managed to pay it off early without work for more money?

Debt management can help you pay off debt. Managing the way you spend your money is a form of debt management. Auto loans is the 2nd highest debt item people normally have. The 1st is a mortgage. Before you purchase your next car, go over the auto finance deals first. Find out the loan payment amounts, and the term (length of the vehicle loan). Once you have this information, you can set up a debt management solution and pay off you debt (vehicle loan) early too.

How to Pay Off Debt Early – Paying Off Your Auto Loans

Although investing seems complicated some investments are very easy to understand once you have the knowledge. And there are many investments that are safe and FDIC insured.

1. Paying Off Debt – I purchased a 36 month CD (certificate of deposit) for $35,000 @ 6% back in 2006
2. Paying Off Debt – Where did I get the money? The $35,000 was part of my retirement fund
3. Paying Off Debt – I earned a total of $10,500 in interest. I could have elected to receive $175 per month in interest transferred to another account, but this was earmarked to pay off the car early
4. Paying Off Debt – I cashed out the CD at the maturity date (the maturity date is the end of the CD term, which was 36 months)
5. Paying Off Debt – I paid off the car which was just under $8,000
6. Paying Off Debt – I returned $35,000 to my retirement fund along with $2,500 which was remaining from paying off the car.
7. Debt Management – Now, my expenses have dropped $550 per/month
8. Debt Management – I will invest the reduction in expenses amount towards my retirement.

CDs (certificates of deposits) interest rates are not high these days, but they’re rates are better than regular savings accounts or money market accounts. Therefore, planning your next big purchase, along with a current CD can get you what you want without it hurting.

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