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The Simple Dollar

Interest rates on student loans: when things get fishy

Interest rates can change when consolidating private and subsidized loans. Be sure to have the consolidation and the interest rates documented. See question No.3 of the Reader Mailbag.

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You can sell a car that you owe money on, but you have to handle the transaction with your bank involved in the process. The easiest way to do this is to execute the transaction at a branch of that bank when you’ve informed them ahead of time of what the situation is so that they can have the title on hand when you actually make the sale and pay off your loan with the proceeds from that sale, all in one meeting. This is how we purchased our most recent vehicle.

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If you’re just moving from one car payment to another, I’m not sure you’re going to be much money ahead on this after all of the taxes, transfer fees, and so on. It’s going to depend on what exactly you get as a replacement, how good of a deal you make on both the sale of this car and the buying of the next car, how much in debt you actually have to go on your next car, and so on.

Are you sure there aren’t merely lifestyle options that could reduce your usage, such as carpooling? Bicycling? Walking? Civic transport? These would all reduce the miles you put on your vehicle, likely saving you significant money.

Q5: Moving from Mint to spreadsheet
I have been using Mint.com primarily as an aggregate. I like it because it pulls all my financial accounts into one easy reference to see how everything is doing. I don’t really use it for budgeting or expense tracking (I have my own custom spreadsheets for these purposes).

I keep having problems with Mint.com not interfacing with various accounts, so I’m ready to dump it. Also, like you have stated about Mint in the past, I am beginning to mistrust a 3rd party app with access to so much of my financial data. I have a vague recollection of you discussing this in a blog post, and that you mentioned you have your own method of pulling an aggregate of financial data. Do you use a spreadsheet and do a monthly (or other regular) update manually?
- Hillary

I pull information into my own primary spreadsheet manually. It’s pretty straightforward. I just have a column for each month and a row for each different account, with debts separated from assets. This allows me to easily add up my assets, subtract my debts, and get a good estimation of my net worth.

Here’s how to build such a net worth calculator in your own spreadsheet tool.

I prefer such tools for privacy purposes and flexibility purposes. They might not be as “slick” as something like Mint, but I don’t have to worry about syncing errors and I don’t have to worry about identity theft, either.

Q6: Savings or down payment?
My wife and I are currently saving up for a house. We already own two rental homes we have owned for approximately 5-6 years. I bought both of these prior to meeting her and getting married, so both loans are in my name only. I owe a total of about $180,000 between the two of them. We have limited equity in both due to the decline in real estate prices. I am in no hurry to sell either. One is rented out so we break even every month and we are living in the other home for now although it’s not a house I would like to live in 3-5 years from now.

We also have $18,000 we owe on a new car we bought last year and right around $20,000 in savings. We share one credit card for most expenses that is paid full at the end of each month. My car is owned free and clear, the only debts we have our the two mortgages (both in my name) and the car payment. We would like to move into a new home in the next year or two. Mortgage rates should still be low and home prices should be about bottomed out (in my opinion). My fear is that my wife will have to carry most of the loan since the other two mortgages are in my name. Should I keep the $20,000 in savings (we plan to have $30,000) for a down payment next year or should I pay off the car in full now and still have time to save up for a smaller down payment?
- Matt

In my eyes, it depends on the interest rate on the car loan. Is it substantially higher than what you’d expect to get on your mortgage if you didn’t have your 20% down payment?