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Author Topic: What to do with $7000?  (Read 2135 times)

Offline clayfarmer

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What to do with $7000?
« on: May 02, 2012, 08:47:44 AM »
So I find myself with a check in hand for roughly $7000.  I won't bore you with why or how....suffice it to say I have $7000 that I didn't have yesterday.  My question is, if you found yourself with $7000, what would you do with it?

I have some savings, but not the typical 3-6 months emergency fund that most people recommend.  I owe about $9000 on a car, and thats my only debt other than my house.  As far as preps go, I'm pretty new at this.  I have about 3 months worth of food stored up.  Been wanting to buy a generator, been wanting to buy some silver, etc etc etc (you know how it goes).

So I guess my question is, whats more important?  Having an emergency fund, getting out of debt, or buying preps?
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Re: What to do with $7000?
« Reply #1 on: May 02, 2012, 08:56:10 AM »
All three are important, so it's a matter of prioritizing.  Personally, I'd lean toward putting most of it into savings and maybe pick up one big ticket prepping item you've been thinking long and hard about, like a generator or solar.  I'd probably use this as an opportunity to start buying small amounts of precious metals every month, too.  Since none of us know if silver is near its top or its bottom, buying a bunch all at once has its own inherent risks.  However, buying 1-2 ounces of silver a month for the next year or two with some of your windfall might make sense for you.
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Re: What to do with $7000?
« Reply #2 on: May 02, 2012, 09:15:25 AM »
me, I would throw it on that vehicle.  7k off of 9k means that in just a few months (say your car payment is around $400) you will be SAVING $400 a month that you can put into savings.  and think of all the interest you will have saved!  you will have saved years paying off that thing.
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Offline idelphic

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Re: What to do with $7000?
« Reply #3 on: May 02, 2012, 09:16:06 AM »
I agree with Endurance...  Maybe go at the old budgeting process of envelopes..  Starting off with putting a bit into savings.. say $1000.  Next look at a big item that you NEED.. not want, that will come in a minute.

Balance out what you are needing, You can even look at the possibility of a small investment, either in the Market, PM, or say a solid firearm, ammo.  It's all about balance IMO,.. your needs will differ.

Next comes the cash on hand(COH) (maybe)..  Do you have a COH envelope - or emergency fund that is handy at a moments notice.

Of course there's the food, water, GEAR (Pack, stove, fire kit, etc),

I've used the other item of MapMoney..  Take $100 or $200 - set limit and use for mad money.  Take yourself to a movie, take a break,.. do something for yourself.
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Offline Cedar

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Re: What to do with $7000?
« Reply #4 on: May 02, 2012, 09:21:12 AM »
What do you need? Like with my tax return I am getting my chimney repaired so I can have heat if the electricity goes off. Even though I have natural gas for heat (which I hate), if the power goes off, we have no heat. I have a awesome woodstove here and have not been able to use it as the pipe looks like a colander apparently.

Basic needs are Food, Water, Shelter. Are you lacking in any of those areas? Get the basic minimums.

Next is getting out of debt. How much do you owe, VS what you make a month? What makes more sense? Like with Roundabouts on forum, many of us recommended she NOT pay off her debt at the moment as it was low enough monthly payments, it was not setting her back. Are you paying $100 month on that car or are you paying $500? Can you cut back even more and make double payments on your home to get that paid off sooner than later? That said, I also had 4 months of paychecks saved, which saved my bum when my employment got sold to the competition and then killed off. Having a large pantry also saved me then as well, as well as 3 other times.

How important is a generator to you? Do you WANT it, or do you NEED it? When I lived in the bush, the power would go out for 9+ days. I know I do not need a generator, so it is low on my priorities and I also do not want to deal with storing fuel. Other than freezers (and I have other options there) I can't think of a single reason why I need one. Recently I met someone who needed a generator as a back up for someone with health issues and needed electricity to run her medical equipment. I do however, have a small solar setup that I have had for 5-6 years and use constantly. I got it to learn about solar on a small scale before I went to anything more.

I am with Endurance though as all three, having an emergency fund, getting out of debt, and buying preps is important, but only you can tell you what is a priority and what is not as high on the list.

Cedar
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Offline Outdoorfury

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Re: What to do with $7000?
« Reply #5 on: May 02, 2012, 09:49:21 AM »
I am with Morning sunshine. I have the around the same debt on my car and would want to pay it off! If you want you can donate it to Toyota financial for me! haha
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Offline Roundabouts

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Re: What to do with $7000?
« Reply #6 on: May 02, 2012, 10:58:10 AM »
Well after everything we have been through this year. Crap storm after crap storm.  I can honestly say from my point of view  HOLD ON TO THAT CASH!!!  SAVE IT!!!   Like Cedar said above the consensus was for me to hold savings and wait to pay off the house.  I can always reevaluate things on a later date.  Now where we sit I could really use an additional 7-25k more.  That's my emotional & experienced response.  You can never have enough $$$ cash.  That also includes metals.

Now I'd say after the emotions die off and excitement.  Sit with paper and pen calculate out how long it would take you to save back up to the $7000 if you did pay it off.  How much you will spend or save on the interest.   Then ask yourself if you really feel that comfortable being short on cash (I call it having your arss hanging in the wind) for that period of time.  We ask ourselves how long will it take to pay this and that off but equally important is to ask yourself how long will it take to build that cash reserve?    If you are going to save say $3000 in interest by paying your car off well that is a huge chunk you will be saving.  However if you will only save $300 (not that $300 is chump change)  but I would say spending $7000 to save $300 not worth leaving me hanging.  If times got financially hard you can always let your car go or sell it.  Shoot maybe you could even do that now and solve both problems.  Once that money is spent it is spent.  Will the monthly savings in payments be enough to really help you out? 

If one of your goals is to have an ER fund along with food ect then maybe you can look at it is now you are that much closer.  (I always count my stored food as cash savings also)  I also view it as large chunks of cash are hard to come by.  If it is hard for you to make additional car payments as it is then it may be even more important to hold cash.  After your cars are paid off it will be easy to take a few hundred here and there to buy the items on your list. 

How would you fare during a big IF… you a loved one pet very close friend had an ... illness  injury income loss major repair bill natural disaster tornado fire flood hurricane ( the more likely for your area)  You might find your answer in asking yourself that question. 

In short  do what will give YOU the most preparedness for YOUR most probable situations that could happen. 
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Offline suzysurvivor

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Re: What to do with $7000?
« Reply #7 on: May 02, 2012, 11:15:47 AM »
i might be a little different but as this is a SURVIVAL forum,  i would think in those terms.  I would get that small generator, i'd spend about $1000 on water and food storage (two things we can't live without for very long and imo you can't have too much of either)...I'd buy whatever I was lacking to keep myself and family alive for at least 3 months...even a little extra.   

If the S truly hits the fan, savings and car payments won't matter.  Silver cannot be eaten.  I respect the opinions of those who garner the silver and gold but that's far beyond survival in my book.   

I'd spend about half of it for preps and then I would put the rest in savings.  Coz if the s DOESN"T hit the fan, you'll still need to make those car payments.

 Now you may mail me a check for my 2 cents worth, :P

Offline FletchBZMMT

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Re: What to do with $7000?
« Reply #8 on: May 02, 2012, 03:27:21 PM »
So I find myself with a check in hand for roughly $7000.  I won't bore you with why or how....suffice it to say I have $7000 that I didn't have yesterday.  My question is, if you found yourself with $7000, what would you do with it?

I have some savings, but not the typical 3-6 months emergency fund that most people recommend.  I owe about $9000 on a car, and thats my only debt other than my house.  As far as preps go, I'm pretty new at this.  I have about 3 months worth of food stored up.  Been wanting to buy a generator, been wanting to buy some silver, etc etc etc (you know how it goes).

So I guess my question is, whats more important?  Having an emergency fund, getting out of debt, or buying preps?

Looking around us, and what's going on in the world around us, I'd have to say preps... Do you feel safe with what you currently have? Do you feel that "if" something happens it will take more than 3 months to stabilize? No one can answer this questions for you, you and you alone will have to decide this for you and or your family. ;D There's no hidden message or meaning in that either. What I may feel comfortable with many other people won't etc...

You can't eat silver or gold. They are for after the situation is over, not to get you through it IMO. Once things are over, yes, absolutely it will probably come in handy. Look at this way; would you be willing to trade your limited supply of food for something that wasn't going to directly make your situation better if you have no idea when you be able to buy more food? I wouldn't, but to each their own.

I'd suggest trying to find someone local that you can TRUST with experience prepping. Go over your full plan with them, and find out what the weaknesses are in your plan. Again just like Jack teaches, you don't have to tell someone every single little detail to get help. Many times it can be a whole category you've overlooked... (We ALL have weaknesses in our prepping plans.) I wouldn't make any major purchases until you've done this step. A generator may be right for you, but then again, you may have a much bigger need that none of us can advise you of over an internet forum.

Hope that helps, and good for you for asking for help! I sure know that I have asked a lot over the past few years... "The way of a fool is right in his own eyes, but he who is wise listens to counsel."
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Offline FreeLancer

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Re: What to do with $7000?
« Reply #9 on: May 02, 2012, 03:55:43 PM »
I'd put it in the emergency fund because it gives you the most options.  Look at your budget and see where you can tighten up your expenses and throw those savings at the debt and preps.  Most of the sudden disasters we are likely to face are easily solved with a healthy emergency fund to fall back on.
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Offline archer

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Re: What to do with $7000?
« Reply #10 on: May 02, 2012, 04:47:12 PM »
most into an emergency fund.... never know when you will have a 'rainy day'.


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Offline clayfarmer

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Re: What to do with $7000?
« Reply #11 on: May 03, 2012, 11:17:41 AM »
Thanks for all of the great input.  I got a payoff quote on my truck this morning and found that it was only going to save me about $100 to pay it off now (go screw, Chase Bank!).  So I've decided to just stick the $7000 into my emergency fund, which gives me a solid 3 months worth of expenses in my emergency fund.
 
I still have a few hundred bucks in my budget each month to put towards prepping, so I can continue to make progress in that area without touching my emergency fund. 

Thanks for helping me think it through!
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Offline Roundabouts

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Re: What to do with $7000?
« Reply #12 on: May 03, 2012, 08:32:05 PM »
yeah Well at least  now you can scratch your ER fund off your to do list!
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Offline bobandjess

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Re: What to do with $7000?
« Reply #13 on: May 04, 2012, 07:08:31 AM »
Thanks for all of the great input.  I got a payoff quote on my truck this morning and found that it was only going to save me about $100 to pay it off now (go screw, Chase Bank!).  So I've decided to just stick the $7000 into my emergency fund, which gives me a solid 3 months worth of expenses in my emergency fund.
 
I still have a few hundred bucks in my budget each month to put towards prepping, so I can continue to make progress in that area without touching my emergency fund. 

Thanks for helping me think it through!

That sounds like you are happy with your choice and congrats to you! We just had to make a similar decision with some unexpected cash and it was a bit of headache trying to figure out what the "right answer" was. It was very good to just make the decision and be done. Good for you!
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Re: What to do with $7000?
« Reply #14 on: May 04, 2012, 07:34:55 AM »
good job on the research, and I have to admit, after I had posted the first time, I started leaning towards throwing it in the bank for a few months and waiting to make a decision.

I am glad you have peace about it.   :)
"Preparedness, when properly pursued, is a way of life, not a sudden, spectacular program" - Spencer W. Kimball
"Life isn't about trying to survive the storm; but about learning to dance in the rain" - unknown
Luck is what happens when Preparation meets Opportunity

Prepping makes even a hurricane just an inconvenience.