2000 Dollars loan from Employer at 0% interest (Seeking advice )

[ElizabethtownHeel]

Guys my employer is proud to tell us from time to time that they operate debt-free.
During the Virus outbreak, they are offering a 0% interest loan up to 2000 dollars for employees with 5 plus years of service.
I like the terms, I get the lump sum and repay it 40 a week for 50 weeks starting in July 2020.
Looking for advice from any who are financially savvy.
I have thought should I take it?
I think I would like to take it!
I thought of buying some stocks with it, while they are selling at low prices.
I thought of paying down the mortgage.
I thought of putting in a savings account.
You guys gotta any advice?
Thanks in advance.

A little background on me.
I have no credit card debt.
I put about 20 percent of my salary in our 401K
My only debt is my home mortgage.
I am a lifetime Tar Heels fan!

 

[WhatTheHeel?]

I imagine the consensus on this board will be to spend it on hookers and blow.

Stocks aren't necessarily cheap right now and who knows what the next year holds, but if you go that route, maybe just a Vanguard ETF.

You'll get next to nothing in interest in a savings account. Not sure there's any benefit to doing that. You could just put $40 in the savings account for each of the next 50 weeks and have about the same amount in a year.

Paying down on the mortgage would get you some interest savings and you'd pay it off a little quicker if you own the home for the life of the mortgage.

Sounds like a good Dave Ramsey question.

 

[ElizabethtownHeel]

The hookers and blow , I would have no idea where to obtain them from.

 

[cletusnow]

The hookers and blow , I would have no idea where to obtain them from.

Try Fayetteville or Lumberton, best guess.

 

[dadika13]

The hookers and blow , I would have no idea where to obtain them from.

When you find out can you please help out @Raising Heel. He apparently doesn’t know either. #campaignpromises.

 

[heelmanwilm]

Free money is always good. Maybe invest it in your home to make it more energy efficient and get your money back down the road. Like a timer on the hot water heater, an attic ceiling fan, weather stripping etc. Get the hvac serviced.

 

[Hark_The_Sound_2010]

There's no downside in taking the money given the 0% interest, provided you don't squander it and become burdened to pay it back.

Putting it towards the mortgage would be a risk free gain of whatever your interest rate is (roughly).

If you don't max out your 401K, upping your contributions by the 2K total in the next few paychecks would be a good use for it too.

 

[prlyles]

There's no downside in taking the money given the 0% interest, provided you don't squander it and become burdened to pay it back.

Putting it towards the mortgage would be a risk free gain of whatever your interest rate is (roughly).

If you don't max out your 401K, upping your contributions by the 2K total in the next few paychecks would be a good use for it too.

Either one of these suggestions is good advice IMO

 

[ElizabethtownHeel]

I think I will pay down 2 k on da mortgage.

 

[DSouthr]

I think I will pay down 2 k on da mortgage.

First, when offered a zero interest loan you always take it, if you don't need it then use it smartly. I would have suggested you knock off or knock down any revolving accounts you may have or small installment payments but you didn't have those. Right now the markets are all over the place, I maybe would have looked at maybe something like precious metals that tend to do well when the rest of the economy is struggling.

Putting the money on your mortgage is a solid move, do you have a plan on paying down you mortgage faster? Do you understand the mechanics of mortgage acceleration, in other words do you understand each month you make a mortgage payment how much of that payment goes to interest and how much goes directly to the principle? It shocks most folks when they learn how to manage their mortgage properly, it shocks me that most everyone with a mortgage don't really end up knowing how to smartly manage it and what they don't know ends up costing them thousands of dollars, in many cases hundreds of thousands.

Interesting question for you, pull out your mortgage am table from your mortgage closing package. Look at how many years your mortgage is set for, typically 30yrs (360mo), look how long it is set to pay back the 1st half of what you borrowed and compare that number of months to the number of months it takes to pay back the second half, most are shocked to see that difference. Once you understand these numbers you then have the power to dictate your own terms, not the bank friendly terms the banks want you to adhere to.