hi everyone! i (M23) have a question regarding paying off debts vs saving money and i really would like your opinion.
Currently, I get paid around $2000 a month. here are where the money goes.
$800/month - savings
$600/month - car payment ($150 over the minimum payment)
$400/month - personal/discretionary/gas, etc.
$200/month - car insurance
I am lucky, I currently do not have rent/housing payment and I do not pay for groceries as I live with family.
In a month or two, I plan to hit $5000 in my emergency fund. This will cover 6 months of expenses as I currently live, should I need it. Aside from about $1000 I have invested in stocks/bonds, this will be my only savings.
I bought a (used) car in January of this year. I plan to go to graduate school beginning fall 2025 (hopefully). though I am paying more on my car payment than the minimum, I still am about 3/3.5 years from paying it off. I REALLY want to pay off my car as soon as possible, especially before grad school. If I put the $800/month I was putting in savings toward my car payment, on top of what I am paying already, I can have it payed off before or shortly after i begin grad school. But, I will have less $$$ saved.
MY QUESTION: After my $5000 emergency fund is reached, should I stop saving money and put everything I can toward my car payment? If not all, then maybe most of it? Or is this too extreme?
concerning grad school, I have no guarantees, but there is a pretty good chance I can get most of tuition/fees covered through grants/scholarships.
any help, advice, or insight would be appreciated. lmk if anything is unclear.
by u/Pitiful-Lobster-72
in r/personalfinance