— Dave Ramsey, Radio Show 2007-06-08
Wow. Talk about making me feel this big.
Look over in the right-hand column, and the Debt Paydown amount you see is due entirely to our only non-mortgage debt: it's what's left of the loan on our 2006 Honda Accord.
To date, my plan has looked like this: Since my car loan's at a rate of 3.95%, and my Emergency Fund grows at a rate of 5.05% (~4.025% after taxes), I've made minimum payments on the Honda and pumped extra cash into my E-fund. Rate-wise, this is about as break-even a deal as you can get. And having the plump (for us) E-fund has felt better than being in car debt has felt bad. (Variation on a great Ben Stein quote, by the way.)
But what's becoming less and less "break-even" is how I feel when I hear stuff like the quote posted above. It pretty much feels like a punch in my gut. Because I know that it is absolutely, one hundred percent, dead-on true.
The question becomes: What do I do about this? My E-fund is nearly complete. To drain it now, erase the car debt, and start again on the Financial Security Blanket that is my Emergency Fund seems as tremendously unappealing as, say, being on the receiving end of a wedgie doled out by Shaquille O'Neal. I'm only five-foot seven. I weigh about a buck-sixty. That would do me some serious bodily harm.
Conversely, the longer that loan hangs out there in the right-side column, the longer I'll have to see it for what it is: a symbol of either (1) my inability to save money as quickly as I should have in preceding years, or (2) my still-present penchant for spending above my means — at least where our car is concerned.
Or ... both.
I guess I'll reason my way through this, one way or the other. Just please somebody let me know if you see Shaquille heading this direction.
At five-foot-seven, there are still a lot of good places I can hide.