My insurance went up, moved in with my girlfriend (hello higher rent!), and found out I can’t trade in this lease at another dealership. Honda Finance told me dropping the lease now would hit me with a $4k fee. The lease isn’t up until 2026 and keeping up with payments is getting tough with my credit card debt. Juggling school, full-time work, plus doing delivery gigs for extra cash, so getting another job isn’t really an option.
I’m considering taking out a loan to cover the early termination fee and buy a used car instead. Here’s what I’m dealing with:
Salary: $50k/year
Car payment: $514/month
Rent: $1100/month (my half)
Car insurance: $210/month
Would really appreciate your thoughts or any advice on whether a loan is a good move or if there are other ways to handle this mess. Thanks!
Farewell from the author, Seeking Some Relief
Response from THE MONEY MINDER:
Hello There,
I can imagine the stress you must be under with your current financial situation involving the Honda Civic lease, rising expenses, and mounting credit card debt. It sounds like a difficult balancing act between work, school, and managing your finances. While taking out a loan to cover the early termination fee and buying a used car may seem like a quick fix, it’s important to consider all your options carefully.
One approach you could consider is looking into refinancing your car loan. With a salary of $50k a year, refinancing could potentially lower your monthly car payment and free up some much-needed cash flow. Additionally, reaching out to Honda Finance to discuss possible payment plan adjustments or negotiating the terms of your lease might offer some relief.
It’s also essential to create a detailed budget that includes all your expenses and income. Identifying areas where you can cut back or find additional sources of income, like reducing unnecessary expenses, increasing your delivery gigs, or looking into side hustles could help you better manage your financial situation.
In the meantime, reaching out to a financial advisor or credit counselor for personalized advice on debt management strategies could also be beneficial. Remember, taking small steps towards financial stability can make a significant difference in the long run.
I hope these suggestions provide you with some clarity on how to move forward. Remember, you’re not alone in facing these challenges, and there are practical solutions available to help you navigate this tough situation. Take care, and best of luck in improving your financial health.
Farewell from THE MONEY MINDER.
