Topic: The real reason you're broke - Look in your driveway

[No H2O]

Interesting article....most of us probably knew most of this though.

I envy those that can afford car payments. Really, I do. I can't afford the extra interest charges which add thousands to the price of any car. I'm forced to pay cash. 

[quadzilla]

I envy those that can afford car payments. Really, I do. I can't afford the extra interest charges which add thousands to the price of any car. I'm forced to pay cash. 

Even though I get your comment/joke the facts are you can afford the interest but choose to pay cash. Besides, why would anybody pay cash if they could get a car for < 2% interest.  Can't you make more on your money in the bank than giving it all up at once?

[mdxtasy]

I envy those that can afford car payments. Really, I do. I can't afford the extra interest charges which add thousands to the price of any car. I'm forced to pay cash. 

Even though I get your comment/joke the facts are you can afford the interest but choose to pay cash. Besides, why would anybody pay cash if they could get a car for < 2% interest.  Can't you make more on your money in the bank than giving it all up at once?

  There's always an opportunity cost to doing one thing or another with money. 

[carcrazy]

Interesting article....most of us probably knew most of this though.

I envy those that can afford car payments. Really, I do. I can't afford the extra interest charges which add thousands to the price of any car. I'm forced to pay cash. 

It's nice to afford to buy your new car cash (I did it once and it felt good afterwards - no car payments), but not everyone can always do it.

Buy what you LIKE AND AFFORD in the worst-case scenario… Yes, I’m conservative when it comes to debt, but I sleep well at night.

[mdxtasy]

Interesting article....most of us probably knew most of this though.

I envy those that can afford car payments. Really, I do. I can't afford the extra interest charges which add thousands to the price of any car. I'm forced to pay cash. 

Can the same be said about the family home?   Interest charges are astronomical. 

[No H2O]

Besides, why would anybody pay cash if they could get a car for < 2% interest.  Can't you make more on your money in the bank than giving it all up at once?

Not really, unless you want to take risks in the market. And your bank interest is "interest income" on your tax return. Furthermore, tha bank loan interest is calculated differently than the interest that the bank pays you.

Besides, you won't get the same discount when getting that <2% interest....so there is at least $2000 you are giving up in the form of a discount.

[mdxtasy]

Risks are part of life.  Paying cash for a car also has risks....an outlay of such a large amount of cash can potentially put one in a short term cash crunch if there's an unforseen need for the money. 

[No H2O]

It's nice to afford to buy your new car cash (I did it once and it felt good afterwards - no car payments), but not everyone can always do it.

Yes they can do it. If they can afford $350 a month payments, then they can afford to do that once the loan is paid off. Open up a seperate account and continue making those same payments for the next 4 to 5 years.

I always when someone I tell to do that tells me they can't afford to do so....cripes, they've been doing it for the last four-plus years. Funny thing is they can afford an extra $5000 on top of what I would have paid for that same car. I can't afford to do that.

Never take a loan on something that depreciates.

[mdxtasy]

I'm not disagreeing with your point about paying cash for a vehicle.  But any method of payment has both their ups and downs. 

[safristi]

 ......as  OUR "MONEY" may be appreciating against the US buck..the BEST BANG FER YER Canuck buck right now is either an US off 'eh LUXURY MACHINA or a decent mid level Sports or Family hauler  just off a 3 year lease fer CASH.....amazing GRACE....

[mdxtasy]

......as  OUR "MONEY" may be appreciating against the US buck..the BEST BANG FER YER Canuck buck right now is either an US off 'eh LUXURY MACHINA or a decent mid level Sports or Family hauler  just off a 3 year lease fer CASH.....amazing GRACE....

Are we going to see a US "Lotus friend" drop in for that Lotus lawn ornament of yours?

[No H2O]

Risks are part of life. Paying cash for a car also has risks...

And perks. I never get full coverage insurance. Its a bad deal in most cases. Now there is a risk, but being accident free for well over 30 years, I know I'm way ahead.

An outlay of such a large amount of cash can potentially put one in a short term cash crunch if there's an unforseen need for the money.

A lot of consumers hardly have enough for a decent down payment, so thats hardly a concern.

[safristi]

..NOT BLUDDY LIKELY...i haf half a BRIAN...!!!!.....the OTHER HALF is firing on 4 Cylinders wif Cut Orff ta TWO when passing PORSCHES !!!!!

[No H2O]

Safie, I hope you saved all that as a hot key. Man, that looks like work. 

[safristi]

"Safie!!!"... i do that on AUTOBAHN.dot Corn wif a Timmies in myLEFT hand....

[carcrazy]

It's nice to afford to buy your new car cash (I did it once and it felt good afterwards - no car payments), but not everyone can always do it.

Yes they can do it. If they can afford $350 a month payments, then they can afford to do that once the loan is paid off. Open up a seperate account and continue making those same payments for the next 4 to 5 years.

What you are saying makes partial sense and here it is the reason:
$350/month car payment requires a substantial downpayment (e.g. I put $10.5K down on $26K OTD vehicle with 2.9% for 4 years for a 342/mo payment) . This would extend the saving time from 4-5 years to 7-8-9 years (you will have to rebuild the down payment amount as well); your car won't have much value after 8  years.

[safristi]

..NO BUY depreciating SH*T ya can afford to LOSE..in a moments notice.....