One of the first questions people ask themselves when they find themselves swimming in debt is should I pay off my car early? Even if you feel financially secure, having a car payment can significantly impact your budget and assets.
So, what gives? Should you take the plunge and make bigger payments or use your tax returns to get that loan off your balance sheet? Let’s find out!
Can You Pay Off a Car Loan Early?
The simple answer is a resounding YES! Paying your car loan off early is as simple as rearranging your budget to allow more of your income to be dedicated toward your car payments. Even a few extra dollars per month will add up to shaving at least a couple of months off your original loan terms.
If You Pay Off a Car Loan Early Do You Save Interest?
Car loans have some of the highest interest rates in the financial world, next to credit cards. Paying this type of debt off sooner than the agreed terms will not only save you money monthly moving forward but also trim off some interest that you would have paid over the life of the loan.
How to Pay Off a Car Loan Early
One of the easiest ways to pay your car loan off is to consolidate your debt with a title loan. Simply search for title loans near me online and you’ll find a plethora of lenders that are willing to pay your debts and allow you to make one monthly payment for shorter terms.
Benefits of paying Your Car Off Early
Besides losing the interest, there are a few other great reasons to lose the car payment altogether.
Save for Your Next Car!
Cars depreciate fast and if your car is more than a few years old it’s probably already outdated with all the new technology emerging in the auto industry. Paying off your current loan will help you save more toward your next purchase – that SUV you’ve been dreaming of or the sports car you’ve had your eyes on.
Save on Car Insurance
Many lenders require that you carry additional coverage on your vehicle while the loan terms are open. Once you pay off that debt, you can reevaluate your coverage and likely lower your monthly premium. At the very least, you can remove comprehensive coverage from your policy.
Quit Asking Yourself ‘Should I Pay Off My Car Early and Just Do It!
Instead of asking, should I pay off my car early, you should be asking yourself why you should pay off your car early. We hope this post answered some of these questions for you so you can find your way to financial freedom and start saving for other important investments, like your wedding or a new home. Why not pay off your student loans while you’re at it, or other debts that have been looming over your head?
We hope you will visit our blog again to find out all the details about the life and success that awaits you.