CobyRupert
Super Member
What's the advantage of paying ahead on a 0% percent loan?
A) Aren't you missing out on any gains your money could of made in the interim?
B) Given inflation aren't today's dollars worth more than tomorrow's? (Sort of like how a 1972 dollar is worth way more than a 2017 dollar).
If it wasn't a 0% loan there is an advantage in paying ahead and saving interest fees, but only if you make the regular payment the next month.
I did this with my house mortgage every chance I could get. Example: Using an amortization table, on month #14, I'd send in the month #14 payment and also send in the principle portion (only) of month #15's payment (i.e. skip paying the interest portion of month #15). I could then cross of month #15 as paid. When the next month came around I could consider myself on month #16. Having a 8% mortgage at the time, I think I saved myself about $150,000 worth of interest.
A) Aren't you missing out on any gains your money could of made in the interim?
B) Given inflation aren't today's dollars worth more than tomorrow's? (Sort of like how a 1972 dollar is worth way more than a 2017 dollar).
If it wasn't a 0% loan there is an advantage in paying ahead and saving interest fees, but only if you make the regular payment the next month.
I did this with my house mortgage every chance I could get. Example: Using an amortization table, on month #14, I'd send in the month #14 payment and also send in the principle portion (only) of month #15's payment (i.e. skip paying the interest portion of month #15). I could then cross of month #15 as paid. When the next month came around I could consider myself on month #16. Having a 8% mortgage at the time, I think I saved myself about $150,000 worth of interest.
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