Does My Financial Decision Make Sense?

[Hkak45]

For a 4.25ish return I’d be hitting up treasuries right now rather than CDs personally

Lots of liquidity, easy to exit if needs change before maturity.

Yep. IBonds for example are going to most likely beat 4.25 for the next year so put the money into that and then you can still withdrawal it if needed after 12 months but lose 3 months interest which would still average over 4.25. (not financial advise and not a financial advisor just stating opinion)

Sponsored

 

[Hkak45]

Asking the internet for investment advice will make you poor

Not always true. Learning about the market and financial tools has made me tons over the years from the knowledge I learned on forums like boglehead and others. Not all internet forums are bad

 

[joeb]

Working numbers:

Someone suggested I pay off loan then take what would have been monthly payment and invest each month.

Doing that -- I start with zero dollars but also zero loan to repay

Monthly payment is currently 742$
Keeping loan for 60 months = 44,520 paid

Investing 50,000 in a 60 month CD @ 4.25 I believe yields 11,500 interest earned on top of my original principle = 61,500$

Hmmm. Not sure I can make that amount starting from 0$ investing 742 a month for 60 months.
I would like to hear more from all of you.

 

[Badplaid72]

Do it! Kidding I don’t know. Maybe call somebody?

 

[tn3sport]

TBill pays 4.4% for 26 week term. Auction (non competitive on new issue) is tomorrow at TreasuryDriect.gov. (Or buy from your favorite broker. No commission on TBills via Fidelity, Vanguards, Schwab, et al)
You're only locked in for 6 months. Then, you can spend it or roll it over or choose a different duration. They have TBills for 4 wks, 7, wks, 13 wks, 17 wks, 26 wks, 52 wks, et al.

Tbills are killing it right now and rates are going up. Its NOT a good time to lock into a 5 year CD...

 

[MNbronco]

Working numbers:

Someone suggested I pay off loan then take what would have been monthly payment and invest each month.

Doing that -- I start with zero dollars but also zero loan to repay

Monthly payment is currently 742$
Keeping loan for 60 months = 44,520 paid

Investing 50,000 in a 60 month CD @ 4.25 I believe yields 11,500 interest earned on top of my original principle = 61,500$

Hmmm. Not sure I can make that amount starting from 0$ investing 742 a month for 60 months.
I would like to hear more from all of you.

10k for you, 10k for wife (if married) in ibond will return around 8% over next 12 months. pay off the remainder of loan.

 

[Yukon65006]

10k for you, 10k for wife (if married) in ibond will return around 8% over next 12 months. pay off the remainder of loan.

If going the ibond route buy now and buy again in Jan.

 

[joeb]

TBill pays 4.4% for 26 week term. Auction (non competitive on new issue) is tomorrow at TreasuryDriect.gov. (Or buy from your favorite broker. No commission on TBills via Fidelity, Vanguards, Schwab, et al)
You're only locked in for 6 months. Then, you can spend it or roll it over or choose a different duration. They have TBills for 4 wks, 7, wks, 13 wks, 17 wks, 26 wks, 52 wks, et al.

Tbills are killing it right now and rates are going up. Its NOT a good time to lock into a 5 year CD...

Good to know
Thanks

 

[joeb]

10k for you, 10k for wife (if married) in ibond will return around 8% over next 12 months. pay off the remainder of loan.

Will look into this also
Thanks

 

[Hkak45]

TBill pays 4.4% for 26 week term. Auction (non competitive on new issue) is tomorrow at TreasuryDriect.gov. (Or buy from your favorite broker. No commission on TBills via Fidelity, Vanguards, Schwab, et al)
You're only locked in for 6 months. Then, you can spend it or roll it over or choose a different duration. They have TBills for 4 wks, 7, wks, 13 wks, 17 wks, 26 wks, 52 wks, et al.

Tbills are killing it right now and rates are going up. Its NOT a good time to lock into a 5 year CD...

How do you find what the rate is for the tbills? Or do they not release that until the date of auction?

 

[hsun85]

Has anyone mentioned YOLO on OTM calls?

 

[Marauder]

Maybe you should look into MP4’s

 

[Wolfeman]

If you have the money to pay off your new vehicle, I'd pay it off.

My 2021 is paid off and it is a very free feeling knowing I don't owe a dime for it.

Take the money you would be paying every month and invest it as freely as you'd like, or use it to pay down any other debt you may have.

 

[Rdonohoe]

If you financed at 3.85% in an 8% inflationary world, is the bank paying you 4.15% to borrow that money?

 

[sjudas]

So, I took delivery of my '22 Wildtrak in late September this year -- one month ago.

I financed roughly 45,000$ @ 3.85 for 60 mo.

Now, I had a CD that was earning a measly .55 % and was not going to mature until Aug 2025.

So. I closed the cd (early and took a little penalty on interest earned -- negligible for this story)

I am in process of opening a cd for 4.25 apy for 60 mo.

Am I ahead in long run, even because of taxes paid on interest, or am I still losing?

Would like to know your thoughts.

Hello. What was the premium you used to open the CD? We need the amount to figure your annual interest. Then deduct for taxes and you will get your net CD interest. How close you are to covering the Bronco loan interest depends on how much $ is in the CD.

Sponsored