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We have a car loan with a balance of $7100 at 5.9%
We have savings of $4000 at 3.25% (Emigrant Direct).
We currently pay $1300-1400 to this loan each month, which would have it paid off in August.

Should we go ahead and apply the $4000 to the loan, allowing us to pay it off by May? After that the money would go back into the savings account.

The only thing stopping me is that this takes away all of our "slush fund" for overspending. It is technically part of our efund, but we dipped into it some this month for some special purchases. We're still adjusting to a new takehome pay and having 2 people under one roof. Taking away the easily accesible savings is probably good, but hard mentally.

Further complicating the situation is the fact that DH will get his last paycheck in September and will have greatly reduced income. We could be selling/buying a house and I could be changing jobs. We plan to have the loan paid off either way, but having the cash in the account is reassuring. We do have another 4-5 mos. of income saved elsewhere.

Any thoughts?
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