Porsche ownership, Cash or Finance?
#61
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Absolutely. I bought my first 911 in 1970 and have owned every iteration, other than the 996 and always paid cash. Porsches have never been my DD, and I drive them about 4 - 5 K miles a year. I get zero pleasure driving a MT sports car in bumper to bumper traffic: I have an AT Audi for that.
I keep my Porsches for 6 - 7 years and then sell them privately. A 6 year old, documented, well maintained 911 retains a large percentage of its retail value. For example I paid a little over $90K for my 997S in 2007, and sold it for $58K in 2013. So it only cost me about $400 a month, which is inexpensive for a high end car. My point is that you don't have to buy used to get value in your Porsche ownership.
Bottom line is that I would never finance the purchase of what is in essence a grown-up toy. On the other hand everyone is different, and I would never criticize those who don't want to postpone their Porsche ownership gratification.
Moreover, financing is good for the economy.
I keep my Porsches for 6 - 7 years and then sell them privately. A 6 year old, documented, well maintained 911 retains a large percentage of its retail value. For example I paid a little over $90K for my 997S in 2007, and sold it for $58K in 2013. So it only cost me about $400 a month, which is inexpensive for a high end car. My point is that you don't have to buy used to get value in your Porsche ownership.
Bottom line is that I would never finance the purchase of what is in essence a grown-up toy. On the other hand everyone is different, and I would never criticize those who don't want to postpone their Porsche ownership gratification.
Moreover, financing is good for the economy.
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#63
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A home is not an ATM.
#67
Three Wheelin'
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Your example is poor one in that a vacation is a short term event, but a luxury car can last for years.
#69
Drifting
#71
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I was not trying to be trite in the least. How many people lost everything because they were maxing out the LTV on their home loans only to find the value wasn't there after the housing bubble burst?
I think the bubble did all the proving necessary. If you don't recognize that risk, then you and I will never agree.
Have a good one,
Joe
#72
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Join Date: Aug 2016
Location: S Carolina coast & N Carolina mountains
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"How many people lost everything"
repeat - know how to take advantage of cheap money
"I think the bubble did all the proving necessary."
I touched nothing in my portfoilio through the 2000 dot com bubble and the 2008 bubble you speak of and came out the other side in fine shape so your anecdote proves nothing.
one last time - know how to take advantage of cheap money
repeat - know how to take advantage of cheap money
"I think the bubble did all the proving necessary."
I touched nothing in my portfoilio through the 2000 dot com bubble and the 2008 bubble you speak of and came out the other side in fine shape so your anecdote proves nothing.
one last time - know how to take advantage of cheap money
#73
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I think we're confusing affordability with financing options. My credit union did 36 months at 1.5% which was so cheap I didn't think twice though I was disappointed I missed their .9% offer a month earlier. Money is so cheap these days I think it's hard to see value in paying in cash up front.
#74
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It's all about your age. If you're younger and have time to absorb short term losses, it makes more sense to finance and put the money into dividend stocks, and maybe even write options against them to increase your returns. You have higher expected returns on the alternate use of the money than the cost of financing, but also higher risk associated with that.
If you're older and nearing retirement, it makes more sense to take the security of paying cash.
If you're older and nearing retirement, it makes more sense to take the security of paying cash.
#75
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Dewinator, everything you say makes sense from a financial standpoint, but even though money at 2 or 3 %, or even .9%, is very cheap, the purchaser still has to come up with the funds for the payment every month. I like to pay the cash up front and not tighten up the monthly budget. If there's excess, put it away, in essence paying yourself back for the car instead of the bank.