View Poll Results: did you pay Cash Finance or Lease
Paid cash
62
53.91%
Financed
28
24.35%
Leased
25
21.74%
Voters: 115. You may not vote on this poll
did you pay Cash Finance or Lease
03-09-2019, 05:30 PM
#106
Rennlist Member
First let me say this. I love the looks of your car. It's beautiful.
You sound like a financial savvy person. You have it under control. I'm speaking in general for people that borrow money and say its an investment. They borrow the same money multiple times. Example: I can afford this car for $100k, I currently have $500k in savings. I will take a loan because I can make more on my money then the loan rate. 3 months later, I'm going to by this boat for $90K, I can afford it because I have $500k in savings. I will take a loan because I make more money in the market then loan cost. Buy a new cabin, $200K, can afford because I have $500k in savings... They keep borrowing against the same money. As someone else just noted these people run into trouble when something turns down. They are too leverage and the market is not going well and they lost their job, now they can't make the payments. This money that was sitting there making money is half what it was and I can't pay for the car.
Do you have earned income? If yes, ask yourself would you finance the car if you were retired and had no more earned income? How would that change financial decisions?
You are not leaving money on the table. You might be putting on some rose-colored glass when looking at your true cost of ownership of your cars. :-)
Enjoy driving that beautiful car.
You sound like a financial savvy person. You have it under control. I'm speaking in general for people that borrow money and say its an investment. They borrow the same money multiple times. Example: I can afford this car for $100k, I currently have $500k in savings. I will take a loan because I can make more on my money then the loan rate. 3 months later, I'm going to by this boat for $90K, I can afford it because I have $500k in savings. I will take a loan because I make more money in the market then loan cost. Buy a new cabin, $200K, can afford because I have $500k in savings... They keep borrowing against the same money. As someone else just noted these people run into trouble when something turns down. They are too leverage and the market is not going well and they lost their job, now they can't make the payments. This money that was sitting there making money is half what it was and I can't pay for the car.
Do you have earned income? If yes, ask yourself would you finance the car if you were retired and had no more earned income? How would that change financial decisions?
You are not leaving money on the table. You might be putting on some rose-colored glass when looking at your true cost of ownership of your cars. :-)
Enjoy driving that beautiful car.
cheers!
03-09-2019, 07:54 PM
#107
Intermediate
This has been an interesting discussion and while I’m surprised by some of the reasoning, I’ve probably been through all these stages at one point in my life or another.
When I had my first job, had no credit history, and just needed a car to get to work, I bought the cheapest used car I could find with what little cash I could scrape together (1969 BMW 1600).
Later, when I needed something more reliable (and presentable), I borrowed a modest amount to get a new car with payments within my monthly income/budget. At that time, I was still paying rent on an apartment and the car (1993 Mazda MX-5) was just another recurring expense.
Still later, when I ran my own business in Germany, I leased a Lotus because I could deduct the cost. I bought that car when the lease ended, but my wife “encouraged” me to sell it after I drove her to the delivery room.
I’m now paying cash for my GTS and wouldn’t be buying it otherwise.
When I had my first job, had no credit history, and just needed a car to get to work, I bought the cheapest used car I could find with what little cash I could scrape together (1969 BMW 1600).
Later, when I needed something more reliable (and presentable), I borrowed a modest amount to get a new car with payments within my monthly income/budget. At that time, I was still paying rent on an apartment and the car (1993 Mazda MX-5) was just another recurring expense.
Still later, when I ran my own business in Germany, I leased a Lotus because I could deduct the cost. I bought that car when the lease ended, but my wife “encouraged” me to sell it after I drove her to the delivery room.
I’m now paying cash for my GTS and wouldn’t be buying it otherwise.
03-09-2019, 08:08 PM
#108
Three Wheelin'
Paid in cash .. No Debt , No banks ...I barley even use my wallet ... One interact card and a knot of cash in my pocket is all I need.
03-09-2019, 09:17 PM
#109
Rennlist Member
Originally Posted by jp884
Where are people getting these rates of 1.74% on a purchase of $100K and more? I have a credit score in the 800's, little debt, no credit card debt and I get mailers for credit card companies gloating about an interest rate of 10%? Of course I laugh at it while I'm ripping it up. But I can't imagine that a standard car loan would be less than 4% in today's market. But I guess that I would not know.
03-09-2019, 09:36 PM
#110
Rennlist Member
Originally Posted by rileyracing1
Paid in cash .. No Debt , No banks ...I barley even use my wallet ... One interact card and a knot of cash in my pocket is all I need.
And helps me kept track of al my purchases, unlike cash. If I lose my wallet, no harm done. Block my card and get a replacement overnight.
Try that with cash...
03-09-2019, 10:34 PM
#111
Rennlist Member
I'm going to put my earlier response another way.
I'm retired and we live off a "large" age 70 Social Security income, plus 4 little pensions, plus RMDs from our IRAs. I have a chunk in shorter term bonds, but don't like longer term bond interest rate or credit risk, so I lean a little toward lower volatility ETFs with higher dividend rates, along with our base Total Stock Market, commercial REIT (but not shopping mall), and healthcare/biotech ETF investments. My thinking is that tech has already had a very strong run and already is well represented in our VTI ETF base investment.
And we have significant Roth IRA accounts because I do my own investment and tax planning, and we had several occasions over the years to do Roth Conversions when our taxes would be low (or zero after Hurricane Katrina).
So, I don't mind taking out an auto loan for 1.99 or 2.49%, while leaving intact our assets in diversified ETFs paying 4% or more.
Does this help y'all understand our 'borrowing to buy a car' ??
I'm retired and we live off a "large" age 70 Social Security income, plus 4 little pensions, plus RMDs from our IRAs. I have a chunk in shorter term bonds, but don't like longer term bond interest rate or credit risk, so I lean a little toward lower volatility ETFs with higher dividend rates, along with our base Total Stock Market, commercial REIT (but not shopping mall), and healthcare/biotech ETF investments. My thinking is that tech has already had a very strong run and already is well represented in our VTI ETF base investment.
And we have significant Roth IRA accounts because I do my own investment and tax planning, and we had several occasions over the years to do Roth Conversions when our taxes would be low (or zero after Hurricane Katrina).
So, I don't mind taking out an auto loan for 1.99 or 2.49%, while leaving intact our assets in diversified ETFs paying 4% or more.
Does this help y'all understand our 'borrowing to buy a car' ??
03-10-2019, 12:30 AM
#113
I'm going to put my earlier response another way.
I'm retired and we live off a "large" age 70 Social Security income, plus 4 little pensions, plus RMDs from our IRAs. I have a chunk in shorter term bonds, but don't like longer term bond interest rate or credit risk, so I lean a little toward lower volatility ETFs with higher dividend rates, along with our base Total Stock Market, commercial REIT (but not shopping mall), and healthcare/biotech ETF investments. My thinking is that tech has already had a very strong run and already is well represented in our VTI ETF base investment.
And we have significant Roth IRA accounts because I do my own investment and tax planning, and we had several occasions over the years to do Roth Conversions when our taxes would be low (or zero after Hurricane Katrina).
So, I don't mind taking out an auto loan for 1.99 or 2.49%, while leaving intact our assets in diversified ETFs paying 4% or more.
Does this help y'all understand our 'borrowing to buy a car' ??
I'm retired and we live off a "large" age 70 Social Security income, plus 4 little pensions, plus RMDs from our IRAs. I have a chunk in shorter term bonds, but don't like longer term bond interest rate or credit risk, so I lean a little toward lower volatility ETFs with higher dividend rates, along with our base Total Stock Market, commercial REIT (but not shopping mall), and healthcare/biotech ETF investments. My thinking is that tech has already had a very strong run and already is well represented in our VTI ETF base investment.
And we have significant Roth IRA accounts because I do my own investment and tax planning, and we had several occasions over the years to do Roth Conversions when our taxes would be low (or zero after Hurricane Katrina).
So, I don't mind taking out an auto loan for 1.99 or 2.49%, while leaving intact our assets in diversified ETFs paying 4% or more.
Does this help y'all understand our 'borrowing to buy a car' ??
03-10-2019, 12:37 AM
#114
Burning Brakes
Leased because this is our first Porsche and first expensive sports car. Our first and last lease. We were unsure whether the thrill would wear off so wanted to pay extra to have the option to walk away at lease end. Lease ends in a few months and we love the car and plan to pay cash for the residual. We are nearing retirement and only debt is the car lease so in good shape. With fun vehicles my attitude is paying to have fun. I never really consider resale value that much. If I owned a lot of pricey cars or bought and sold them often then that would be another story. As it is, our 911 is kind of a one-off extravagance. I buy and sell motorcycles pretty often but the cash involved is so much less, and I always pay cash with those.
03-11-2019, 08:38 AM
#115
Three Wheelin'
I have a pretty low debt to income ratio, and with finance rates lower than what I can make on having my money invested, I’d rather carry the debt and have my money liquid and making me money. Plus, I’m not rich like you MFers so, yeah, I financed and traded my 2018 C4S as downpayment.
03-11-2019, 09:18 AM
#116
This is an old thread and I'm surprised about the number of people who pay cash. Paying cash for a 100k+ car is stupid IMO.
Cash gives you a buffer if your financial situation goes to crap (lost job, medical, investment gone bad etc etc). It can be invested to earn more etc.
You can finance a car for 2-4% today...That is easy to make in the stock market in less than a week. Unless you're really clueless or pay a retard to manage your money 10-20% gains per year are easy. Dumping cash into a new car that loses 20% per year is as Dave Ramsey says 'stoooooopiiied.'
If you're buying older used cars and slowly upgrading, paying cash from 'saved depreciation' can make sense. Never will it make sense for a brand new Porsche.
Leasing is also a rip off unless you're the type that likes to trade in every 2 years and limit miles. Its never cheaper than financing longer term.
Best thing to do is to finance with the longest term (between 60-70 months today), lowest interest rate (between 3-4% today), and least down payment possible (typically banks want 20%). Save or invest your cash. Keep and drive the car 5+ years or don't buy.
Cash gives you a buffer if your financial situation goes to crap (lost job, medical, investment gone bad etc etc). It can be invested to earn more etc.
You can finance a car for 2-4% today...That is easy to make in the stock market in less than a week. Unless you're really clueless or pay a retard to manage your money 10-20% gains per year are easy. Dumping cash into a new car that loses 20% per year is as Dave Ramsey says 'stoooooopiiied.'
If you're buying older used cars and slowly upgrading, paying cash from 'saved depreciation' can make sense. Never will it make sense for a brand new Porsche.
Leasing is also a rip off unless you're the type that likes to trade in every 2 years and limit miles. Its never cheaper than financing longer term.
Best thing to do is to finance with the longest term (between 60-70 months today), lowest interest rate (between 3-4% today), and least down payment possible (typically banks want 20%). Save or invest your cash. Keep and drive the car 5+ years or don't buy.
03-11-2019, 11:32 AM
#117
This is an old thread and I'm surprised about the number of people who pay cash. Paying cash for a 100k+ car is stupid IMO.
Cash gives you a buffer if your financial situation goes to crap (lost job, medical, investment gone bad etc etc). It can be invested to earn more etc.
You can finance a car for 2-4% today...That is easy to make in the stock market in less than a week. Unless you're really clueless or pay a retard to manage your money 10-20% gains per year are easy. Dumping cash into a new car that loses 20% per year is as Dave Ramsey says 'stoooooopiiied.'
If you're buying older used cars and slowly upgrading, paying cash from 'saved depreciation' can make sense. Never will it make sense for a brand new Porsche.
Leasing is also a rip off unless you're the type that likes to trade in every 2 years and limit miles. Its never cheaper than financing longer term.
Best thing to do is to finance with the longest term (between 60-70 months today), lowest interest rate (between 3-4% today), and least down payment possible (typically banks want 20%). Save or invest your cash. Keep and drive the car 5+ years or don't buy.
Cash gives you a buffer if your financial situation goes to crap (lost job, medical, investment gone bad etc etc). It can be invested to earn more etc.
You can finance a car for 2-4% today...That is easy to make in the stock market in less than a week. Unless you're really clueless or pay a retard to manage your money 10-20% gains per year are easy. Dumping cash into a new car that loses 20% per year is as Dave Ramsey says 'stoooooopiiied.'
If you're buying older used cars and slowly upgrading, paying cash from 'saved depreciation' can make sense. Never will it make sense for a brand new Porsche.
Leasing is also a rip off unless you're the type that likes to trade in every 2 years and limit miles. Its never cheaper than financing longer term.
Best thing to do is to finance with the longest term (between 60-70 months today), lowest interest rate (between 3-4% today), and least down payment possible (typically banks want 20%). Save or invest your cash. Keep and drive the car 5+ years or don't buy.
everything you say is valid. Sort of.
First, Ramsey says pay cash for everything. Including your home. And no toys until everything is paid off, retirement is up to date, and you have an emergency fund.
Second, you can make those gains until you don’t. And when the market drops, it’ll be big. People could lose 20-30% or more of their portfolio. It has happened before.
If you have payments to make, it makes life exponentially harder. If you don’t, your life changes very little.
Third, if you do need the money, and it’s all invested, you take it out at a loss. If you can leave it in the market, you have time for it to rebound.
Yes. Your points are valid for certain situations. For me, I think buying toys on credit is about the worst thing anyone can do. You open yourself up to potential downfall. I’m okay with that risk on investments and a home. But for a toy? No way.
03-11-2019, 11:35 AM
#118
^^^
lasty, if ****e does happen, I prefer to sell a toy than my investments. It’s not on a balance sheet of any kind. But if I really needed to, I could sell the car or watch or whatever, even if at a loss, and put the cash to good use. Instead of selling investments at a loss and will never come back.
Much rather lose money designated to a toy, than money designated to long term investing.
lasty, if ****e does happen, I prefer to sell a toy than my investments. It’s not on a balance sheet of any kind. But if I really needed to, I could sell the car or watch or whatever, even if at a loss, and put the cash to good use. Instead of selling investments at a loss and will never come back.
Much rather lose money designated to a toy, than money designated to long term investing.
03-11-2019, 11:36 AM
#119
Rennlist Member
Leased because it seems that I can't hold on to a car for very long. An added bonus: if it gets hit, I can get fresh sheet metal and don't need to worry about the CarFax.
03-11-2019, 11:39 AM
#120
This is an old thread and I'm surprised about the number of people who pay cash. Paying cash for a 100k+ car is stupid IMO.
Cash gives you a buffer if your financial situation goes to crap (lost job, medical, investment gone bad etc etc). It can be invested to earn more etc.
You can finance a car for 2-4% today...That is easy to make in the stock market in less than a week. Unless you're really clueless or pay a retard to manage your money 10-20% gains per year are easy. Dumping cash into a new car that loses 20% per year is as Dave Ramsey says 'stoooooopiiied.'
If you're buying older used cars and slowly upgrading, paying cash from 'saved depreciation' can make sense. Never will it make sense for a brand new Porsche.
Leasing is also a rip off unless you're the type that likes to trade in every 2 years and limit miles. Its never cheaper than financing longer term.
Best thing to do is to finance with the longest term (between 60-70 months today), lowest interest rate (between 3-4% today), and least down payment possible (typically banks want 20%). Save or invest your cash. Keep and drive the car 5+ years or don't buy.
Cash gives you a buffer if your financial situation goes to crap (lost job, medical, investment gone bad etc etc). It can be invested to earn more etc.
You can finance a car for 2-4% today...That is easy to make in the stock market in less than a week. Unless you're really clueless or pay a retard to manage your money 10-20% gains per year are easy. Dumping cash into a new car that loses 20% per year is as Dave Ramsey says 'stoooooopiiied.'
If you're buying older used cars and slowly upgrading, paying cash from 'saved depreciation' can make sense. Never will it make sense for a brand new Porsche.
Leasing is also a rip off unless you're the type that likes to trade in every 2 years and limit miles. Its never cheaper than financing longer term.
Best thing to do is to finance with the longest term (between 60-70 months today), lowest interest rate (between 3-4% today), and least down payment possible (typically banks want 20%). Save or invest your cash. Keep and drive the car 5+ years or don't buy.