Skip to main content

Dave Says: Hefty Car Interest Payment

Share This article

Dear Dave,

I recently bought a new car and financed it at 17.9 percent for 72 months. I did this hoping it would help improve my bad credit. The payments are $468 a month. That means I’ll end up paying about $13,000 in interest alone. Is there a way I can avoid paying all this interest?

- Marcus

 

Dear Marcus,

Yes, there is a way, but you won’t like it. Sell the stinking car!

If your credit is bad, it’s because you haven’t paid your bills, or you haven’t paid them on time. I’ve got a feeling a lot of this can be traced back to the fact that you’ve been buying a bunch of stuff you can’t afford, like a new car with $468 a month payments. What a bad plan!

You’d have more than $5,000 in less than a year if you take those car payments and save them. That kind of money will get you a great little-used vehicle, and best of all, a car like that won’t be a drain on your income for the next six years!

- Dave

Share This article

About The Author

Dave
Ramsey

Dave Ramsey is America's trusted voice on money and business. He has authored five New York Times best-selling books: Financial Peace, More Than Enough, The Total Money Makeover, and EntreLeadership. His newest book, written with his daughter Rachel Cruze, is titled Smart Money, Smart Kids. The Dave Ramsey Show is heard by more than 8 million listeners each week on more than 500 radio stations.