Hypothetical question /biz/ Let's say you're helping

>>1406039
>your wife's son
gets me every time m8

Pay down the higher APR (and really you should be using APY) first. Effectiveness of the dollar contribution scales with the APR.

Buy ETC

>>1406039
I forgot an important part. He has roughly $1200 a month to accomplish these financial goals trying to trying to waste as little as possible on interest.

My financial competency level: Dave Ramsey

>>1406070
But doesn't that add up to more interest in the long haul across both loans? Taking >>1406078 into account I mean.

>>1406039
>>1406070
i agree, pay higher APR, it'll cost more than it should in the long run.
>>1406083
youre paying .5% monthly on 13.5k loan comapred to a next to nothing monthly R on 56k loan. get rid of 13.5k because its killing you faster than the other loan.

i mean i could tell you more if you told me more of the terms, 13,500 over how many years? same for 56k (im assuming this is a student loan) also remember student loans are tax deductable

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>>1406083
>same for 56k (im assuming this is a student loan) also remember student loans are tax deductable
that is assuming youre american..

im sorry but that 6% loan is just one of the highest APR loans ever, idk if its a joke or not but he should really fucking get rid of it.. thats like semi loan shark numbers

>>1406358
>>1406374
Reversed. 13.5k student loan at 6% and 56k at 2.5% is a mortgage (whats left of it, over half paid)

The terms of the student loan are infinite in the sense you pay pretty close to interest only if you want.

>>1406443
i would still purge that 13.5k student loan, 2.5% mortgage is a QT3.14 deal (15 year fixed) and you can take care of that later. Youre gunna want to keep that 2.5% mortgage running and make it work for you while you get rid of the student loan. the student loan should be number one. after you get rid of student loan, youre claiming to have 1200 a month to finance these operations, then id save 3/4th of that if you can and add to the pay of mortgage with the rest..

the only way to live in this life is debt free. Even Jews know this; they never take out a loan, only give money at interest (interest is a jewish concept).

crush the debt that is killing you faster, then go after the slow beast.

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>>1406039
>your wife's son
>your wife
>'s son
>pic related is trash with tattoo

Checks out.

>>1406727
When would he save the $7,000? He has no solid emergency fund to speak of beyond about $2,500.

>>1406734
My marriage depends on this senpai, I need advice

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>>1406852
get a divorce, that's the best advice i can give.

>>1406852
First, save an emergency fund for 3 months' expenses. Then >>1406727

>>1406734
jesus i thought it was something like his nephew or something.
>>1406852
regardless of your personal decisions, get this millennial faggot on a plan to save at least 3k for >>1407033 (basing his living expenses off of my bare minimum living expenses for 3 months as a poorfag)
and then follow my plan on >>1406727
saving is all cute and shit but, honestly, why save when youre in debt like this. hes too young (implying hes young since he still has student loan debt and is your wifes son)

does he have a job? like a real person job not working at red lobster and begging for tips. also get a tax accountant to help with his taxes, see if he can get an itemized deduction larger than his standard.

Is he married? does his wife have any income besides money at the strip club? does he have a conservative mentality or is he a hippie? tell him debt is bad. any debt is bad, there is no such thing as good debt when dealing with personal affairs.

I'm kind of a contrarian, but my advice would be this.

Ignore the 2.5% loan. It can be floated almost indefinitely, since any investment can handily beat that.

Next, renegotiate the 6% loan, or releverage with another cheaper one. Capital is so cheap these days, paying any more than about 4% is criminal.

Start investing a portion of the income in cashflowing investments. Depending on how cheap you get the small loan down to, maybe invest all of it for a time, until you get to a point where that cashflow can pay a good chunk of the monthlies on one or both of the loans.

Then, once you have that cashflow, start smacking the smaller one down. By this time, both loans have shrunk, so it'll be even easier to pay them off.

Once you have them both paid, you'll be left with cashflow, which should easily build up to 7k. That 7k savings should be the very last thing you do.

>>1407033
His monthly expenses are around $1650 and he's got $2500 now. I was thinking of telling him to save up to $5000 first covering about 3 months.

>>1407631
Yes he's got a real job and definitely has a conservative mentality. His wife has an income and so does her son but nothing beyond that, no cash stashed away somewhere.

The student loan debt is actually a small portion of what his schooling cost. He worked and paid most himself and took very modest loans (relatively speaking) to pay off the rest. This was in like 2009 so rates were much higher then.

It's worth noting that since he owns a home, I feel the savings part is important. Nothing crazy but at least something.. not sure if $3000 would cover it.

>>1408064
This is what I was thinking but a variation of it.

Save up another $2500 bring him to $5000 emergency. Then refinance the student loans into a 2.5-3.5% loan (he has decent credit). After that invest a portion while throwing all the rest at the student loan. Once that's done follow it up with the mortgage.

Why do you suggest saving the cash last? What if something bad happens between now and then - wouldn't that set him back?

>>1406039
Sell all your belongings and pay off the 6% loan. Then make minimum payments on the 2.5% and invest all your money in stocks.

>>1408140
Eh, if there's some sort of emergency, just float it on a card and use the cash from that month to pay it. No need for a huge emergency fund.

Just make sure that you have enough in the bank to avoid bank account fees.

Why cash last? Because it's not that useful I guess. Seems to me having just 7k sitting around doing nothing is a waste.