u/WiiperWapper

I have about 20k left on an auto loan at 4.2 %, with the term ending in June 2028. My current salary allows me to invest a smaller amount into my TFSA each month. Based on my calculations I would have enough money to pay off the car in a lump sum payment next June, saving me a year of monthly payments. This would likely eat up most of what I have invested in the TFSA, but then I would unlock about $870/mo of "new money", which I could then put back into the TFSA and other investments going forward.

The advice I am looking for is whether it would be a smarter play to just keep paying the auto loan until the end of its scheduled term (June 2028) since the interest rate is low, or if withdrawing the TFSA savings to pay off the car and then reinvest the new monthly savings would be a more fiscally responsible decision. Thanks for any input you guys have.