I owe $6k on my 2016 Subaru Forester with 5% interest, and I’ve got $10k on a credit card with 27% interest. The Subaru has 101k miles and hasn’t had any issues so far. I’ve been thinking about whether I should trade it in for a newer car or just keep it. What do you all think? Should I focus on paying off the credit card or the car first? And is trading in my Subaru a good idea?
You don’t need a new car. Stick with your Subaru, pay off the credit card first because of the high interest, and drive the car until it’s absolutely necessary to replace it.
Jade said:
You don’t need a new car. Stick with your Subaru, pay off the credit card first because of the high interest, and drive the car until it’s absolutely necessary to replace it.
It’s wild how many people jump into buying new cars they can’t afford. I had a few used cars over the years before I bought new, and I plan to drive this one for the next 20 years.
Jade said:
You don’t need a new car. Stick with your Subaru, pay off the credit card first because of the high interest, and drive the car until it’s absolutely necessary to replace it.
Same here. I regret trading in my paid-off car. Lesson learned!
Why do you think you need a new car? Does your Subaru not meet your needs?
Focus on paying off the debts, especially the credit card with that insane interest rate. Then see if you really need a newer car. Don’t act like you’re swimming in cash when you’re clearly not.
Stick with your Subaru since it’s almost paid off. Clear the credit card first because the interest rate is killing you.
Pay off the credit card debt first. That 27% interest is costing you way more than the 5% on the car loan. Once the credit card is done, use those savings to knock out the car loan.
You have $10k in credit card debt. You shouldn’t even be thinking about getting a different car right now.
Focus on the credit card first, then the car loan. Keep driving the Subaru until you’re debt-free and in a stable place financially. Subarus can last forever if you take care of them, so don’t rush into a new car.
I like the snowball method—pay off the car first, then tackle the credit card, and finally start saving for a future car. Your Subaru should last you another 100k miles if you take care of it.
Micah said:
I like the snowball method—pay off the car first, then tackle the credit card, and finally start saving for a future car. Your Subaru should last you another 100k miles if you take care of it.
Snowball is good for people with multiple debts, but here, I think focusing on the higher-interest debt (credit card) makes more sense. The savings in interest will make a big difference.
Always pay off the debt with the highest interest rate first. In your case, that’s the credit card.
Why are you even thinking about buying a new car when you’ve got $10k in credit card debt?
Your Subaru is working fine, so keep it and focus on paying off the credit card first. No need to rush into buying a new car.
Your credit card debt is costing you way more than the car loan. Pay the credit card first, then tackle the car loan. And don’t buy a new car until you’re debt-free and have savings.
Always pay off the higher interest debt first. Focus on the credit card.