7. hannah is about to get a raise at work that will add $200 to her monthly paycheck. she wants to buy a new…

7. hannah is about to get a raise at work that will add $200 to her monthly paycheck. she wants to buy a new car to replace the four - year - old car she is driving. she has $1,000 in her emergency fund and a credit card balance of $650. if she trades in her car and buys a new one, her current payment will only increase by $75. she is leaning toward doing this because she would still have $125 extra per month. what would dave say? (remember, dave always gives a reason with his advice, and keep the baby steps in mind when answering.) (7 points)

7. hannah is about to get a raise at work that will add $200 to her monthly paycheck. she wants to buy a new car to replace the four - year - old car she is driving. she has $1,000 in her emergency fund and a credit card balance of $650. if she trades in her car and buys a new one, her current payment will only increase by $75. she is leaning toward doing this because she would still have $125 extra per month. what would dave say? (remember, dave always gives a reason with his advice, and keep the baby steps in mind when answering.) (7 points)

Answer

Explanations: Dave would likely advise against buying the new car. First, he would suggest paying off the $650 credit - card balance as part of the baby steps to get out of debt. Also, while she has an emergency fund of $1,000, it may not be sufficient for all potential emergencies. Buying a new car, even with the extra $125 per month, could put her in a precarious financial situation if unexpected expenses arise.

Answer:

Dave would say not to buy the new car. First, pay off the credit - card balance and ensure a more robust emergency fund.