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Why you should pay off your car loan ASAP

Free yourself of your car loan.

FORTUNE -- Let's say you have an extra few thousand dollars -- maybe from a tax refund, a bonus, or some other quick windfall. How can you best put it to use?

There are a lot of options, and high-interest rate debt goes on top of the pile. But if you haven't done that kind of borrowing, and you have a comfortable cushion of emergency cash, you might consider throwing it toward your auto loan.

Why? Not because you're going to save a huge amount on interest. You will save some, but most car loans have fairly low interest rates these days, averaging 2.98% for a 60-month new car note. (Note: Used car loans are -- surprisingly -- even a little cheaper than the new ones. They're averaging 2.78% on a 48-month loan, 2.86% on a 60. If you had lousy credit or didn't shop carefully for financing when you bought your car, refinancing is a good and simple move. Credit unions are a particularly good source of loans.)

But the majority of car loans are calculated using what's called the simple interest method, says Mike Sante, managing editor of This means the interest paid each month is based on the loan's outstanding balance. "The earlier you pay off or pay down these loans, the more you'll save in interest payments." You can figure out how much you'll save on your particular loan by plugging your numbers into a calculator like the one at

Not wowed by the figure? You don't have to be. The real reason for getting out of a loan like this early is that you'll be freeing up money in your budget every month. There's an opportunity cost involved whenever you borrow money, and it's a cost many people fail to consider.

"We are in favor of paying off auto loans early because it can help you cope with sudden life changes and afford you more freedom in the long run," says Philip Reed, senior consumer advice editor.

This is, by the way, is the same logic that suggests it's a good idea to get out of your mortgage -- despite its low rate -- before you retire. And that, if you have extra cash to throw against your student loan, you should consider that too. It's not the hefty interest rates associated with these debts, but rather the fact that you have them that stops you from doing other things.

The average monthly payment on a car loan right now is $471 -- what else could you do with that money each month? For instance, if you invest it instead at a 6% interest rate, you'd have close to $77,000 after 10 years. You could build a fully fleshed-out safety net -- something more than half of all Americans don't have right now. Or maybe it would simply give you a little more breathing room in your budget.

In the best of all possible worlds, you could also use that freedom as an opportunity to build a habit of saving. Let's say you have $3,000 left on your car loan, and you pay it off in one shot with a windfall (very possible, as the average tax refund this year is very close to that number). Then you invested the $471 every month, like the example above that gives you $77,000 after 10 years. If you instead just invested that $3,000 at 6%, you'd only have $5,373 after 10 years. Now, obviously, you're investing a lot more money with the first example, and that's why you end up with much more. But part of the reason we don't save is that we never give ourselves the ability to see how good it feels. Once you start to see your money growing, you'll be inspired to keep at it.

If you decide to put a chunk of money toward your auto loan, you want to make sure you're actually paying down principal. In many cases, paying extra will signal to the lender not that you are trying to reduce the amount of interest paid or get out of the loan early, but that you don't have to make another payment for a few months. If you want the payment to go toward principal -- and you do -- you should call the lender and ask how to make that happen. "In some cases, you may need to restructure the loan (which can be done without prepayment penalties). In others, you might have to write two separate checks and clearly instruct the second payment to go toward principal," Reed says.

Arielle O'Shea contributed to this report.



Latinos playing bigger role in California politics

SACRAMENTO - When Romualdo Pacheco became California's first Latino to serve as lieutenant governor in 1871 - and later the state's first Latino governor in 1875, taking over for a man elected to the U.S. Senate - little did he know it would take more than a century before another Latino won a statewide office.

That dry spell was broken when Cruz Bustamante, who had made history by becoming the first Latino to serve as Assembly speaker, won the lieutenant governor's seat in 2000.

The rapid growth of the Latino population - now the plurality in California - has not exactly translated into enormous political clout. The state has not elected a Latino governor, and no Latino has been elected to the U.S. Senate.

Yet there are now more than two dozen Latinos serving in the California Legislature, including Assemblywoman Susan Eggman, D-Stockton, who was elected in 2012.

Eggman was the first Assembly member elected in the newly redrawn 13th Assembly District. In 2010, voters approved Proposition 28, which took redistricting duties away from lawmakers and gave them to an independent commission. The new congressional, state Senate and Assembly districts went into effect in 2012 and resulted in Democrats gaining a supermajority in both legislative chambers.

"Redistricting certainly helped Latinos vie for political office, and the creation of the commission was one of the best things that could have happened, because it took the politics out of redistricting," said state Sen. Ricardo Lara, D-Bell Gardens.


Easter 2014: A celebration of hope

Over 2 billion people are celebrating Easter today, April 20, as the calendars of Western and Eastern churches coincide this year, and these billions of faithful people are celebrating HOPE.  

The Easter message begins with the hopeful news that death has been overcome by life, that hatred has been overcome by love, and that sorrow has been overcome by joy.  

The elements of the story involve women arriving at a garden tomb and finding it empty, but even better, meeting the risen Lord, the embodiment of life and love. Their lives are changed forever and so are the lives of many, many others who hear this remarkable news.

The meaning of Easter is HOPE, and we, all of us, need and deserve hope.

The resurrection narrative and message are vital for Christian people on this day to be sure.  Easter is celebrated in countless languages and myriad cultures by Jesus’ followers throughout the globe.  

However, the news is not for Christians only.  It is for the cosmos, the world, and the universe and for all children, women, and men who draw breath.  It is for all humanity because the reality and meaning of Easter is HOPE, and we, all of us, need and deserve hope.

The events leading up to Easter test hope.  An innocent man is condemned by the authorities around him. He is betrayed, condemned, and executed.  

It looks like the game is over.  Both hope and love are seemingly obliterated, and a stone is rolled in front of the tomb’s entrance to seal the point.  

And yet… hope bursts forth.  Life wins.  Love wins.  Hope wins.  

From the place of death emerges a new alpha point in the affirmation of hope for the world and for humanity.  The resurrection message challenges the doom and gloom so often taken for granted in the world with hope and all of hope’s power to sustain, strengthen, and make things new.

An ancient Christian writer described faith in this way, “Faith is the assurance of things hoped for and the conviction of things not seen.”  (Hebrews 11:1) At the very center of faith is hope, because hope draws us into the flow of life, possibility, and new beginning.  

It acknowledges suffering and sadness, but courageously maintains that there is something more even if it isn’t immediately apparent or seen. 

 Still hope exists.  That is what the earliest Easter morning visitors to the garden and tomb discovered, and that hope transformed and sustained them from that time on. 

This Easter is an urgent moment for hope. There are abundant realities of sorrow, scorn, and separation all around us all the time.   

Human beings are set against each other.  

Wars threaten with vicious power.  

Death takes millions in sickness, hunger, and violence.  

Even in a society as affluent as our own, we worry about the present and future economically, politically, and socially (and admittedly, often things at face value don’t look so good.)  

It is possible to give up and give in to despondent hopelessness.  But hope breaks in.  It breaks into the world, into the human soul, and into our lives. 

 Even if it isn’t immediately visible to the eye, it is there. That is the life-giving, love-creating Easter news.  We can hope, and hope will change the world. 

This Easter Day we are invited to sense the hope that sustains us. We are invited to relish and take courage from the hope of life, of love, and of new beginnings.  

Even if it is not seen at first glance, it is there… Easter hope, and  that’s worth celebrating.

The Rev’d Dr. James B. Lemler pastor, teacher and author who serves at Christ Church in Greenwich, Connecticut.


Quake centered around Acapulco shakes Mexico City

Mexico - myths

A powerful, magnitude-7.2 earthquake shook central and southern Mexico on Friday. The U.S. Geological Survey said it was centered northwest of the Pacific resort of Acapulco, where many Mexicans are vacationing for the Easter holiday.

The quake was felt strongly in the resort city, as well as in Mexico’s capital, but there were no immediate reports of injuries or damage.

“There is a crisis of panic,” said Alicia Dominguez, who answered the phone at the civil protection office. “It’s mainly the tourists who are shaken.” Civil protection officials were patrolling the city to check for damage and casualties.

The quake struck 164 miles (265 kilometers) southwest of Mexico City, which shook for at least 30 seconds. Buildings swayed as people fled high rises and took to the streets. Because of the Easter holiday, that city was less crowded than usual.

“This is really strong,” said Gabriel Alejandro Hernandez Chavez, 45, an apartment building guard in central Mexico City. “And I’m accustomed to earthquakes.”

According the USGS, the quake’s center was 30 miles (49 kilometers) deep.

Mexico City is vulnerable even to distant earthquakes because much of it sits atop the muddy sediments of drained lake beds that quiver as quake waves hit.

The magnitude-8.1 quake in 1985 that killed at least 6,000 people and destroyed many buildings in Mexico City was centered 250 miles (400 kilometers) away on the Pacific Coast.




The Republican National Committee sent a message to President Barack Obama Friday: the GOP is not moving on from Obamacare.

The Republicans' message came in the form of a web video, posted one day after the president announced 8 million people had signed up for private health insurance using the exchanges created by the Affordable Care Act. During the announcement, Obama said it was time for Republicans "to move on to something else," and chastised states that chose not to expand Medicaid "for no other reason than political spite" against him.

"You have 5 million people who could be having health insurance right now at no cost to these states, zero cost to these states, other than ideological reasons, they have chosen not to provide health insurance for their citizens," Obama said during a press conference Thursday. "That's wrong. It should stop. Those folks should be able to get health insurance like everybody else."

Republicans argued that "Americans don't think it's time to move on" in the video. Some prominent Republicans personally promised to keep up the fight against Obamacare, with House Majority Whip Kevin McCarthy (R-Calif.) saying "Republicans cannot and will not accept this law." The office of House Majority Leader Eric Cantor (R-Va.) also released a statement, according to NBC:

If the president is so confident in his numbers, there is no reason not to release transparent and complete enrollment data, and answer the questions, how many enrollees were previously uninsured and how many people had lost their previous plans due to Obamacare.

Sen. Ted Cruz (R-Texas) -- who led the charge in 2013 to tie funding for Obamacare to a continuing resolution to the fund the government, a strategy that ultimately shut down the government for 16 days, cost $2 billion in lost productivity and made no changes to the health care law -- tweeted the following after Obama's remarks Thursday:

Senator Ted Cruz        @SenTedCruz

The repeal debate is far from over. #FullRepeal

3:46 PM - 17 Apr 2014




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