Page 77 - Book3E

For instance: Let's say you decide to buy a car for $15,000 and you take out a standard 5-year car loan at 5% interest. Regular payments on the car would total $283 per month for the 60 month life of the loan. But what if you decided to pay an additional $100 per month on the loan?
The Amortization schedule here shows that the extra payments have reduced the amount of intetest paid on the car loan from $1,984 to $1,429, a savings of $555 over the life of the loan. Additionally, the extra payments cut the time on the loan down from 60 months to about 42 months.
Now here is something interesting. If after you pay off the car, you take the $383 that you were using for the accelerated loan payment and invested it for the remaining 18 months you saved on the car loan in a 5% bank CD, you would have an additional $7,173 in savings!
What to Do With Extra Money 69