Auto Loan Q

[SSSuzie]

I have a 2016 Mustang in which I owe about $13,000; I am getting some money in the future to pay it off.  I eventually want to buy a truck.  Would it be better for me to pay off the mustang now, or wait and go into the dealership with a down payment and a financed trade-in? 

[USAA Social Service]

Hi @SSSuzie.  We recommend to visit usaa.com/financialadvice and you an submit this question.  :)  Best wishes!

[Briana Hartzell USAA · Accepted solution]

Hi @SSSuzie 

Best of luck deciding what to do with your Mustang! I wanted to share a couple points.

First, this post helps break down the costs of buying and owning. 

I also encourage you to consider your emergency fun. Does paying off your mustang deduct from your emergency fund (ideally 3-6 months of living expenses) ? 

Also, keep in mind that car values decrease over time so you may be in better position to keep your cash and go to the dealership with enough of a down payment that you aren't building negative equity in the new truck from the start.

These are just a few points worth considering. I hope that helps!

[SSSuzie]

Thank you!!