siberian

Yep, bought 82 sold 201, not divulging how much. Also this was long term not short term cap gain and principal was reinvested. I don't finance, I either have or don't play but what I won't do is pay for a FA so he can screw my life up and walk away after getting me to buy whatever he's selling. I worked hard for my retirement, I'll invest the time in managing it. Oh and I don't "wag my cash around" to impress anyone, I just mention it for those who depend on FAs.

And lastly you have no idea what interest rates will be in 6 years, whatever they may be now. My car is paid off, YMMV

siberian

Laszlo_Laz

I wouldn’t because it’s an ugly car. That rear is something only a mother could love. Let’s be honest, it looks bad. Porsche please admit and fix your mistake!! Front, side, underneath, HOT, rear end, complete eye sore!

Drew46

You are missing one very important factor - risk. If you can make a risk free return greater than your interest rate (after tax) then finance. There was similar thread about 6 months ago filled with posts about how easy it is to invest and get a greater return than the cost of financing. Funny that we aren't seeing those types of posts in this thread now that the market has taken a beating. Where are all those guys that borrowed the $150K to buy their car since they could easily make more in the market than the cost of the financing. That $150K in investments may very well be worth a lot less than $150K today. If it were so easy to make the money investing, that's what banks (and people who invest in banks) would do with their money rather than lending it to you.

siberian

Exactly what I did, I invested rather than borrowed it and as the actress said the the bishop, timing is everything! YMMV

siberian

AlexCeres

dude. Read 3 and 4 posts up. Fixed rate auto loans are still available in the 4% range. Inflation is 8.5%. With the market down do you want to sell your winners for less than riding it out and pay capital gains ? Or do you eat $8k (sloc) to $15k (traditional finance) in 2022 dollars to save $25k to $40k in taxes ?

Everybody gets to make their own mistakes. But the folks who wave the “risk” chicken around like a talisman instead of just doing some basic math aren’t in a position to give meaningful advice to anyone.

siberian

YMMV. If you think financing and FA are the way - more power to you. If I don't, more power to me. I don't live your life or math you don't live mine. Let's all be happy and enjoy our rides whatever math we use and life we live.

siberian

PS FWIW I forgot to mention, the Federal tax was paid with the sale of my RS5 with cash left over to buy winter tires for the 992.

Drew46

So much wrong here and so much mischaracterization of what I wrote, that it would be senseless to try to provide a substantive response.

slc4s

This is in my top 10 genres of favorite threads. Always a **** show

For what its worth here's my hierarchy of decisions to this regard:

Worst: Low down payment, mostly financed purchase by somebody who couldn't write a check and pay cash. (A brand new 992 is not something one should "stretch" for financially, plenty of great options at more affordable prices if you want a great drivers car, I'd recommend a 996 C4S with manual transmission)
Almost as bad: Leasing at the crazy current terms, with the caveat that if you own your own business there is some goofiness tax wise that might make this make more sense than purchasing
MEH: low down payment, mostly financed purchase by somebody that could afford to write a check and pay cash. I get it, maybe you can do better in the market but adding a bunch of leverage in your life for a toy that has potential to dramatically depreciate is not something I'd recommend to a friend
All Good: Cash purchase or largely cash purchase with some financing (I'd say less than 50% financed) by one that can afford the car. Its a toy. Your are buying responsibly. And when the cars start depreciating again (terrifying how people in this thread act like the 992 is an investment) which they 100% will, you are fine and have all your options available to you.

Triathlonkid

Jack that's a good way of looking at it. Do you divide that by 2 to factor in tax paid on the gains? e.g. 4% interest finance, you invest and make 8% (say, on a $150k @ 8% over 3 years, generates $38k in profit but you owe $19k to taxes assuming top tax bracket) so it barely breaks even?
Do you further reduce the gains and adjust for inflation? e.g. that money in 3 years is worth less compared to today?
vs. if you spend the $150k today that money is worth 8% less every year and in 3 years only worth $130k.

I wonder if there is a simple mathematical model that says if the delta between what your interest/loan finance % vs. anticipated investment return % / 2 (for tax) - inflation adjustment is X, then paying cash upfront is better or worse than leasing/financing.

FullThrottle64

For me it all comes down to the interest rate that's being offered. I know my general ROI for invested assets, so it depends on the net rate for a loan.

PBoxS986

what has been your ROI this year?

FullThrottle64

Slightly positive. I moved to mostly dividend-paying stocks early, which turned out to be a good move.

GeneTakovic

Cash. Always cash.

cota.kitty

Google: “capital gains” “opportunity costs” and “time value of money”

ron4sc

When reading these debates, I always remember what Louis Rukeyser once told a young financial analyst who said, "the market will only go up about 12% this year." Rukeyser admonished him by saying, "if you invest long enough, you'll see a bear market."

Everyone always talks about the opportunity cost of paying cash for a car when interest rates are low. Nobody talks about down markets where you earn less than the interest rate. It's a personal choice, but cars are bad debt. Pay the thing off and put the receipt, along with your paid-off house, in the safe and enjoy all of the investing and living you can do when you are debt-free.

My unsolicited advice.