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No. of Recommendations: 2
Finishing up a car loan

I suggest when it is finished that you continue to pay that amount to a savings account to save for your next car.

Say your loan was for 4 years and your payment is $250/month. Afver the loan is paid off, you'll save $3k/year (plus interest?) for a new car. After 8 years--when your car is 12 years old--you'll have $24,000. Even if you had to buy in just 3 years, you can buy a nice used car for $9k. I would urge you to get off the car loan dependency track. I note that my own car is 10 years old, and although it's our only car (hubby & I are retired, and he doesn't drive any more), I have no near-term plans to replace it. I have enough earmarked for my next car to buy a modest new one--patience is a virtue (so is not being into high status cars ;-)

Speaking of cars, one reason to have an emergency fund is for major car repairs. Maintenance--from oil changes to new tires every few years, a new battery once or twice in a car's life, even major scheduled maintenance--should ideally come from ordinary living expenses in a well-designed budget. But the rare expensive repair should be covered by your e-fund and not turn into revolving debt on a credit card.
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