[Tony]

Opinions! I’m sitting on an RV loan at 8.99%. Making the payments aren’t a problem, so much as it is a nuisance and irritating to be paying 8.99%.

It’s literally our only debt besides home mortgages (primary, and rental property).

Paying it off means pulling 401k funds (I’m retired), which are 100% taxable, at about the 22% tax rate. And the RV loan balance is $80k.

I’ve looked into home equity loans as well. Not sure I like those options either. Decisions were easier when 401k was pulling 25% gains and mortgages were 3%! Lol.

Again…I could easily do nothing and keep making these payments, but I’m always looking to improve financial situations.

I failed to mention that we have recently started to rent out the RV via a couple websites that cover insurance for the guest.

So the RV rentals are covering some of the loan. So far, this will cover 50-60% of the payments for 2025.

[Kristy]

Withdrawing from your 401k has too high of an opportunity cost. The money you could earn is off the table and it’s likely more than 8.99%.

[Josh]

You don’t mention selling the camper, so I assume that you like having it. You say you have no problems making the payments.

So, I would just look at this as one of your costs in retirement that you can afford. Unless you have many years left on the loan I’d just keep making payments.

[Gregg]

IMO….. if it’s possible…I would say pay off the rental and let the money from your rental pay for the RV…. that way…

the asset does the heavy lifting and you can go on with your retirement.

[Tony]

I’d sell it in a heartbeat. You could fund your future vacations with the money you save on loan interest, gas, insurance, and other upkeep, along with the money you’re saving from the loss in value of that depreciating asset.

You can also rent an RV when you want, or you can participate in one of those RV transportation programs like Imoova, Coseats, or Transfercar, where an RV rental company needs an RV repositioned from A to B and you get to use it along the way.

If you’re intent on keeping it I would have it listed on RVshare, Outdoorsy, or any of the other shared economy RV sites when I’m not using it and let other people pay down my expenses.

[Nancy]

You’re renting it out, which will cause Income- does that equal a business?

If you file that as a business then can you take the loan % as a deduction?

[Ryan]

I’m allergic to 9% car loans and completely allergic to toy loans. So, I’d pay it off inside 2 years.

But if it meant selling so much that it hurt my future retirement I’d sell the camper instead.

[Scott]

Depending on your income/age/IRMAA etc you could pay half now and half the first week of January so you spread the withdrawals out over a couple years.

Or a 1/3 now 1/3 Jan 2026 and 1/3 Jan 2027, whatever math makes sense.

Usually, large lumpy withdrawals in one year are tough.

Even if the math is marginal sleeping well (in the RV!) is a factor.

[Casady]

HELOCs and FELs are at a similar interest rate currently. The CU I work at is as low as 7.5 for a HELOC so may not be worth the hard inquiry.

If you have the liquid cash at all, you could always do a pledge loan at a minimal interest rate.

My CU is 2.25% for their pledge loan and you’re essentially borrowing and paying yourself back.

My husband and I rent our RV on outdoorsy (most success) and RV Share. We used to be able to pay our monthly payments with that until we lump sum paid it off as we were at a 10-11% rate.

I’d keep renting it personally, but just know most people will not treat it as kindly so make sure you monitor damages.

And make sure if you are within 8ish hours of burning man that you block those dates or heavily vet the renters during the time, RVs that go to burning man come back with desert dust you can’t get rid of.

[Bill]

Are you just always going to be in the 22% or would this just push you into the 22? If you are always, then you can ignore that because it’s a non factor.

Just take it out now.

If you are usually in the 12%, you can withdraw to the top of the 12 each year to accelerate the payments.

[Gina]

Personally, I’m debt averse and only purchase what I can pay cash for. But, in your case, assuming your 401k balance is a healthy amount, I would pay it off half on year and half the next year, depending on your tax situation.

[Holland]

As the old saying goes, “the only thing better than an RV is a friend with an RV”. That’s the rule to which I subscribe.

I wouldn’t take money out 9f my 401K. Just put every spare dollar in your budget to it.

Remove items from your budget to snowball it.

[Author]

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