cashed in some stock options

[cougar78]

Not a huge amount just 5,000 any suggestions on best way to invest or should I just pay off my car?

 

[halik]

Originally posted by: cougar78
Not a huge amount just 5,000 any suggestions on best way to invest or should I just pay off my car?

is your expected after-tax return on the investment gonna be more than the interest on your car loan?

 

[cougar78]

I'm netting over 5,000 and the principle on the car is probably pretty close or a bit above, basically set me up to pay it off in less then 3 months probably

 

[halik]

Originally posted by: cougar78
I'm netting over 5,000 and the principle on the car is probably pretty close or a bit above, basically set me up to pay it off in less then 3 months probably

Im talking about the investment you're considering. You have 5000 dollars. You should only invest if the expected return on that investment - capital gains tax > interest on the car loan.

ie if you have a loan with a 7% interest, it would be stupid to invest in something that will return 5%.

 

[cougar78]

loan is probaly more then I'd ever see in return from an investment so I guess I should just pay off the car and start saving the money I would use for the car and then invest.

 

[imported_KuJaX]

Originally posted by: cougar78
loan is probaly more then I'd ever see in return from an investment so I guess I should just pay off the car and start saving the money I would use for the car and then invest.

yep, looks like you answered your own question. 🙂

 

[Hyudra]

pay of the car, no debt > debt.

 

[Imdmn04]

5k is not much of an investment.

 

[arcas]

Depends on where you are in your car loan amortization schedule. If you're nearing the end of your loan, the bulk of your monthly payment is going to pay off principle anyway so paying it off in lump sum won't necessarily save much interest. There are lots of amortization calculators available on the web.

In any event, if you have any credit card debt, pay it off first.

 

[Descartes]

Originally posted by: Hyudra
pay of the car, no debt > debt.

Absolutely false.