Anyone else paying in cash/full?

[SUB-FT86]

I like how everybody is always saying " invest your money" like it's a sure thing. It's a gamble period.

[SUB-FT86]

Originally Posted by subatoy

damn I think dropping $25k cash is retarded on a car specially with this economy. Unless you have tons more cash to spare but if you only have $25k mmmm. I'd rather end up paying more due to financing and have all that money in my pocket in case something happens.
to each their own.

If I buy a car in cash I make sure I have a good amount of money left over. Like when I bought my RSX for 12k used I had a couple extra thousands in my savings. I'm so good with money I don't even remember asking anybody for money since I was a kid with no job and now I am 27. I love to save regardless.

[Brett]

Originally Posted by fistpoint

You need to get approved for those low APR's. Not everyone has good credit, while others have little or no credit history.

That side of the coin also isn't as black and white a you make it sound.

If a person is diligent enough to save enough to purchase a new car, chances are good that they also have stellar credit.

Brett

[Sparkplug]

Originally Posted by tripjammer

+1

Take that $30K and by some Apple stocks (AAPL) like he said. It's going to be $1600 a share by 2015! Why spend $30K on a depreciating object like a car. Finance or lease it.

I'm sorry, but suggesting someone to the only purchase one stock with their potential years of savings is idiotic. Apple isn't the second coming of whoever you believe in. Diversification is the key to any well balanced portfolio.

[Sparkplug]

Originally Posted by Brett

Duh. Like I said: YMMV!

However, the S&P has averages about 12% per year for about 80 years. If that tanks faster than the value of your car, we have major problems, and I hope you can all garden, hunt, and build a fire!

Brett

I actually like to do long calls and puts on the S&P 500 because of this. Fairly predictable to generate a decent return most of the time. That said, not like i haven't lost it all on a bad play.

DISCLAIMER: Options are extremely risky to those considering it.

[dori.]

Originally Posted by SUB-FT86

I like how everybody is always saying " invest your money" like it's a sure thing. It's a gamble period.

well it's better (could be. diversify suckas) than throwing all of it into a depreciating commodity such as an automobile

Originally Posted by Brett

If a person is diligent enough to save enough to purchase a new car, chances are good that they also have stellar credit.

Brett

Assumptions much?

[tachi1247]

Financing the car as others have suggested is by far the best financial move. There are investment options out there where you can geta guaranteed rate of return which will probably cover your interest rate.

That said, if you are the type of person who has a hard time being responsible with your money then financing may not be a good idea. Some people just can't help themselves....they would see this pile of cash sitting in the bank and then go blow it on things they don't need or can't really afford, thus spending the money they were supposed to use to make the car payments.

If you fall into the latter category don't finance it, but my guess is that if the OP has saved 24k in the time period he specified then he probably has enough self control and should finance the car.

[tachi1247]

Financing the car as others have suggested is by far the best financial move. There are investment options out there where you can geta guaranteed rate of return which will probably cover your interest rate.

That said, if you are the type of person who has a hard time being responsible with your money then financing may not be a good idea. Some people just can't help themselves....they would see this pile of cash sitting in the bank and then go blow it on things they don't need or can't really afford, thus spending the money they were supposed to use to make the car payments.

If you fall into the latter category don't finance it, but my guess is that if the OP has saved 24k in the time period he specified then he probably has enough self control and should finance the car.

[PSound]

Originally Posted by SUB-FT86

I like how everybody is always saying " invest your money" like it's a sure thing. It's a gamble period.

A gamble with incredibly good odds, especially if you are young and have tax free investment opportunities.

I don't know of any 30 year period where the market declined, and that seems to be the minimum that most of those asking about cash/financing appear to be looking at for retirement.

[DantKR]

Originally Posted by fistpoint

You need to get approved for those low APR's. Not everyone has good credit, while others have little or no credit history.

That side of the coin also isn't as black and white a you make it sound.

I was talking about the people that could. I think even in the case of bad credit it might be a good idea to get a car loan anyways to help build it. If you can afford the car flat out and you have bad credit, I would take the opportunity of a car loan to help improve your credit and pay a lot more than the payments and put enough towards the principal but make it so it would take about 1-2 years to pay off the car so that you don't pay 10k in interest but still get a nice boost to your credit score.

[Dadhawk]

Originally Posted by tachi1247

Financing the car as others have suggested is by far the best financial move. .

That's a matter of opinion and personal preference/philosophy.

Alternatively, you could pay cash for the car, take the "car payment' and dollar cost average it into a good set of mutual funds, and in the end, end up with more money because you can put it in higher yielding investments. Do that long enough between cars and your next car may already be paid for by the time you need it, including paying taxes on the earnings, which you did not mention.

Also, its almost never a good financial decision to purchase a new car. Buying a 1 to 2 year old car, which will most likely still be under warranty, is nearly always a better option. In fact, it is typically cheaper to repair your existing car than to ever buy a new car.

Example, I could swap the engine with a new crate engine (and probably upgrade it to a V8) in my 2001 Chevy Astro every year for the annual car payment cost that folks will pay on the FR-S if they finance it and make monthly payments.

But before you do either of these methods, you need to have an emergency fund to get you through, well emergencies. If you don't, you need to do that first, before you save 1 penny towards either method (cash for a car or financing).

Again, there's nothing wrong with either method and arguments can be made on both sides that its the "best financial decision". In the end the best financial decision is the one that lets you sleep at night.

[marshallpre1]

Two things I follow:

1. Never buy brand new car- especially the first year... Unanticipated problems, immediate depreciation, dealer markups, etc

2. Finance big expenditures- like others said, keep cash for emergencies and investments. A diversified portfolio is key.

[borge12]

Like someone said before, I would highly advise against taking financial advice from random people on the internet. Consult with a professional.

[Dadhawk]

Originally Posted by borge12

Like someone said before, I would highly advise against taking financial advice from random people on the internet. Consult with a professional.

+1. Best advice on any thread here!