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The term of your vehicle loan can make a big difference in what your monthly payment looks like. It can also have significant on the amount of interest you’ll pay over the course of the loan. You pay interest each month on the outstanding balance of the vehicle loan, so the longer the term of the loan the more interest that you’ll pay until the loan is paid off.
As you determine which vehicle to buy and which loan terms to choose, the choices you make can have a big difference in terms of what your monthly payments will be and what the costs of the loan will be once the loan is paid off.
At some point in time, you’re likely to receive an offer in the mail. Transfer an existing credit card balance to a new card and receive a promotional interest rate for a set number of months. Are these offers worth it? It depends on the promotional interest rate, the length of the promotional period, what the standard interest rate is once the promotional period expires and what the fee is to transfer your balance from one card to another. During the promotional period you might be paying a lower rate, or 0% depending on the offer. Are the interest savings greater than the balance transfer fee? Whether they’re a good deal or not also depends on how long it takes you to pay off the card balance once you transfer it to a new card.
If you’re trying to pay down some debt, you might be wondering what the impact would be if you simply increased your monthly payment each month by just a little, or even a lot. When you increase your monthly payment, the amount of the increase gets applied directly to reducing the amount owed, or principle. Reducing the amount of money you owe will reduce your interest charges each month, as the interest rate will be applied only to the outstanding loan balance. An increase in your monthly payment will lessen the amount of interest charges you will pay over the repayment period and shorten the number of months it will take to pay off the loan.
Your monthly payment is based on the net purchase price of the vehicle, the loan term and the interest rate for the loan. Loan amount is based on the net purchase price of the vehicle (plus sales tax) or the vehicle price less any cash rebate, trade-in or down payment. If you have an outstanding balance on the vehicle you trade-in, that amount is added to the price of the vehicle you are purchasing.
Balancing a checkbook is easy. Start with the balance from your last checking account statement. Then subtract all checks that you’ve written that were not listed in this last statement, or any previous ones. Then add back all the deposits that you’ve made into your checking account. The result should be the amount you have in your checkbook as your current balance.
Getting your spending under control and in line with your income is an essential element to building a strong financial future. Analyze your spending (including what you put on a credit card) each month to make sure you’re not spending more than you’re bringing in. Once you’ve got that under control, consider placing what ‘extra’ you have every month in savings. You’ll never know when you’ll need it and its better to take money out of a savings account to pay for unanticipated expenses rather than adding it to a credit card balance.
Determining how much money you’re worth is like having your own balance sheet. On the asset side are things you own: homes, cars, investments and personal property. On the liability side are your debts: what you owe on your home mortgage, outstanding loans and credit card balances. Over time, you want to be reducing your liabilities by paying down debt, and building your assets by saving and allowing your assets to work for you by earning interest or building value.
How many times have you asked yourself “where does our money go?” The first step is to categorize your spending into each specific category. If you’ve got multiple monthly bills under a category, you can use the worksheets linked to the right of the input field to enter each separately. Once you see where you’re spending your money it becomes easier to look at reducing spending in specific categories.
How interest is calculated can have a great impact on the interest earned by your account and how your savings grow. Compound interest arises when interest is added to the principal and when the interest that has been added also earns interest. You’ll see your account balance grow more quickly with accounts that pay interest more frequently. The “Annual Percentage Yield” or APY is the effective annual rate of return once the effect of compounding interest is factored in.
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