The Money Mustache Community
General Discussion => Share Your Badassity => Topic started by: zsmith on January 10, 2017, 04:33:08 PM
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We spent the last six months living car free in Chicago, but the time finally arrived for us to purchase a family car and we did it all in cash. Don't feel like I can share outside of this forum, as I accidentally mentioned our cash purchase to my sister and she just rolled her eyes since having a car payment is the norm.
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Congrats! A new (or new to you) vehicle is great, when its debt free....so much sweeter.
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Depending on how much the car cost. Don't think a car is necessary if you live in the city. We do and we don't have a car.
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I just bought a vehicle this week too; a big white Sprinter van for $44k. All my family freaked out when I said I wasn't getting finance for it and I was paying it in cash outright. They couldn't understand how I could have that sort of money. I told them; ride a bike, don't drink booze, eat healthy, do your own servicing and odd-jobs, put your money in a high interest account, don't buy useless junk, etc. All too hard. I'd rather a bit of work than a huge debt for a liability!
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I just bought a vehicle this week too; a big white Sprinter van for $44k. All my family freaked out when I said I wasn't getting finance for it and I was paying it in cash outright. They couldn't understand how I could have that sort of money. I told them; ride a bike, don't drink booze, eat healthy, do your own servicing and odd-jobs, put your money in a high interest account, don't buy useless junk, etc. All too hard. I'd rather a bit of work than a huge debt for a liability!
Any reason you chose the Sprinter at $44k over a nearly new used Ford Transit in either gas (eco boost!) or diesel for nearly $10k cheaper?
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Forget the Sprinter and Transit, buy a used Uhaul. 5-8k, lots of life left on 'em, and tons of "seating" in the back! (http://www.jonrb.com/emoticons/shhh.gif)
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Depending on how much the car cost. Don't think a car is necessary if you live in the city. We do and we don't have a car.
Wish we could live without a car, but we moved from Chicago to Minneapolis which changed the situation. I still plan to take transit whenever possible (once I figure out how it works here), and we'll find other creative ways to maximize having only one vehicle.
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Depending on how much the car cost. Don't think a car is necessary if you live in the city. We do and we don't have a car.
Wish we could live without a car, but we moved from Chicago to Minneapolis which changed the situation. I still plan to take transit whenever possible (once I figure out how it works here), and we'll find other creative ways to maximize having only one vehicle.
I see that makes sense. We lived in Rochester for a while and would go to the twin cities on the weekend. Hard to get around that place without a car.
Still hope you didn't spend 50k in cash ;)
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We spent the last six months living car free in Chicago, but the time finally arrived for us to purchase a family car and we did it all in cash. Don't feel like I can share outside of this forum, as I accidentally mentioned our cash purchase to my sister and she just rolled her eyes since having a car payment is the norm.
Your sister is right. Having a car payment is the norm. You're the one who is different, and better. Well done.
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Depending on how much the car cost. Don't think a car is necessary if you live in the city. We do and we don't have a car.
Wish we could live without a car, but we moved from Chicago to Minneapolis which changed the situation. I still plan to take transit whenever possible (once I figure out how it works here), and we'll find other creative ways to maximize having only one vehicle.
I see that makes sense. We lived in Rochester for a while and would go to the twin cities on the weekend. Hard to get around that place without a car.
Still hope you didn't spend 50k in cash ;)
Definitely not! Not a beater, but a practical and relatively inexpensive used vehicle.
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Great job!
Our household's last two cars were new, but we still paid cash for them.
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Any reason you chose the Sprinter at $44k over a nearly new used Ford Transit in either gas (eco boost!) or diesel for nearly $10k cheaper?
The primary reason is internal cargo dimesnions. The LWB Sprinter is significantly longer, wider and taller than the LWB Transit or any other cargo vehicle. I am turning it into a mobile tiny home for myself and my partner, so we needed the extra space.
Forget the Sprinter and Transit, buy a used Uhaul. 5-8k, lots of life left on 'em, and tons of "seating" in the back! (http://www.jonrb.com/emoticons/shhh.gif)
I wanted to do this, but it's near impossible to buy a small cargo box van in Australia with a walk-thru from the rear to the cabin. I found one, but it was full of rust and mechanically in poor condition and the seller still wanted $20k. We have U-Haul here, but they're mostly box trailers and not suitable for our needs.
The LWB Sprinter sells for $66k AUD plus taxes and registration here. So $44k plus tax, inc 12 months registration for a near-new vehicle (2 years old and 48k km) is decent.
I'll post up a link and photos once I get it home this weekend and start building.
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Any reason you chose the Sprinter at $44k over a nearly new used Ford Transit in either gas (eco boost!) or diesel for nearly $10k cheaper?
The primary reason is internal cargo dimesnions. The LWB Sprinter is significantly longer, wider and taller than the LWB Transit or any other cargo vehicle. I am turning it into a mobile tiny home for myself and my partner, so we needed the extra space.
Forget the Sprinter and Transit, buy a used Uhaul. 5-8k, lots of life left on 'em, and tons of "seating" in the back! (http://www.jonrb.com/emoticons/shhh.gif)
I wanted to do this, but it's near impossible to buy a small cargo box van in Australia with a walk-thru from the rear to the cabin. I found one, but it was full of rust and mechanically in poor condition and the seller still wanted $20k. We have U-Haul here, but they're mostly box trailers and not suitable for our needs.
The LWB Sprinter sells for $66k AUD plus taxes and registration here. So $44k plus tax, inc 12 months registration for a near-new vehicle (2 years old and 48k km) is decent.
I'll post up a link and photos once I get it home this weekend and start building.
Hehe, they shoulda known there was good mustachian logic behind your purchase. Good on you, mate and keep us posted as your conversion progresses.
BTW, y'all have missed that sometimes it's okay to have car payments, even on a used car purchase. If the interest rate is really low (say, sub 3-4%), you could come out ahead by keeping your cash invested and cash-flowing the payments. Just sayin'.
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BTW, y'all have missed that sometimes it's okay to have car payments, even on a used car purchase. If the interest rate is really low (say, sub 3-4%), you could come out ahead by keeping your cash invested and cash-flowing the payments. Just sayin'.
I looked into finance for these reasons, but it was no bueno. All finance companies I got quotes from wanted 6-8% interest plus other fees and charges they sneak into it. I earn 3.6% on my cash savings at the moment (yes, I am going to improve this asap) as a base level. I still have plenty of liquid cash left over for emergencies or other opportunities.
As nice as it is to keep your cash liquid and available, it's still better financially in many cases to buy it outright if you have the means to do so.
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BTW, y'all have missed that sometimes it's okay to have car payments, even on a used car purchase. If the interest rate is really low (say, sub 3-4%), you could come out ahead by keeping your cash invested and cash-flowing the payments. Just sayin'.
I looked into finance for these reasons, but it was no bueno. All finance companies I got quotes from wanted 6-8% interest plus other fees and charges they sneak into it. I earn 3.6% on my cash savings at the moment (yes, I am going to improve this asap) as a base level. I still have plenty of liquid cash left over for emergencies or other opportunities.
As nice as it is to keep your cash liquid and available, it's still better financially in many cases to buy it outright if you have the means to do so.
Ah yes, but in the US, nobody is paying anywhere near that much interest on cash and new car loans are just 2.24% at my credit union. Totally different math. Also, in the yes, the US Tax Code is crazy category, RV's can be considered second homes and any interest written off, just as if you'd bought a vacation cottage. Nuts.
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Ah yes, but in the US, nobody is paying anywhere near that much interest on cash and new car loans are just 2.24% at my credit union. Totally different math. Also, in the yes, the US Tax Code is crazy category, RV's can be considered second homes and any interest written off, just as if you'd bought a vacation cottage. Nuts.
That would be awesome. Unfortunately, high-interest rates are the norm here in Australia. Good if you have cash sitting in a savings account, not so great if you have debt.
If I could obtain finance at a lower interest rate than my interest rate paid on my savings I would have done it.
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I found MMM, just in time before my next car purchase. I have always been frugal, but I thought a brand new economy car was still a good buy, especially with a loan at 2%. I was going to buy a 2015 Hyundai Accent for around $16,500, with a $4000 down payment.
Instead MMM saved me. I ended up purchasing a 2003 Pontiac Vibe with $165,000 miles for $2,500. It's been 2.5 years and 35,000 miles later and it's been great. Thank you MMM!
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Ah yes, but in the US, nobody is paying anywhere near that much interest on cash and new car loans are just 2.24% at my credit union.
This assumes you are doing the non-mustachian thing (which I did do...I get a car less than once a decade, I wanted a new one) of buying a new car. Used car loans are much higher interest.
That said, it was a small purchase- like $16k, that's nothing, so it didn't seem worth the hassle of dealing with a loan. Maybe at 0% we would have.
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Being ABLE to buy in cash is a good accomplishment. Many (US) folks can't.
Choosing how you divvy up your assets and liabilities is just a personal choice. Net worth is the same regardless on day one.
I always take low interest money where I can. Its imperfect and there's minor risks / cost considerations. It works for me.
Heck I even have a 'loan' at 0%for 6 mo on my $500 new tires just because I can. Its peanuts in the long run, but, then...why not?
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Aren't interest rates pretty low on new/used car loans? I know Nissan does 0% financing for 72 months on some of their new cars. I've seen 1.9% rates on a used car loan as well. I'd probably just take all that cash and invest it as opposed to using it to buy the car upfront.
EDIT: Sorry, looks like this was already mentioned in the thread.
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When my wife and I moved from Australia to the US we didn't have credit ratings, so we had to use savings to buy a car. Didn't have much of a choice in Houston, TX, due to the lack of public transport and the danger of using bikes on the road here. Got the wife a new Toyota Corolla for $17k, paid in cash - was expecting to be able to negotiate down price for cash, as this is usually the case in Australia. Here in the US people looked at me funny when I asked for a lower price because I was paying cash. I ended up knocking the price down from about $21k list to $17k after playing 3 dealerships off each other. That seemed to work better than offering to pay in cash.
When we did pay cash, it was like Toyotas system imploded. Their processes are so set up for putting people on finance, and they still run you through those processes and try and sell you on finance. I was really annoyed that we had to sit in various rooms for hours, while people ran us through paperwork that was designed for people who were getting finance on their vehicles.
BTW we have had so many issues with the electrics in the Toyota Corolla - my advice, avoid it.
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In the US, if you pay for a car in cash (as in a pile of 100's.....not a check), the dealer has to report it to the feds. Anything over $10k gets attention.
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i'd keep the car payment. rates are low. i may try to get an equity loan on mine in 4 months when the loan is paid off b/c why not. its free money. at 3%
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In the US, if you pay for a car in cash (as in a pile of 100's.....not a check), the dealer has to report it to the feds. Anything over $10k gets attention.
For the purpose of conversations, I consider a check (or money order, or electronic transfer) to be cash. I'd expect many others in this thread do too.
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i'd keep the car payment. rates are low. i may try to get an equity loan on mine in 4 months when the loan is paid off b/c why not. its free money. at 3%
I was offered a rate of 16% interest, as no credit rating, no bank cared that I had $50k in cash.
Also, it was a wire transfer - I didn't actually pay in bills.
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Ah yes, but in the US, nobody is paying anywhere near that much interest on cash and new car loans are just 2.24% at my credit union.
Used car loans are much higher interest.
I admit, I was lazy and just asked DH to look it up for me when I wrote the previous post. Just went to their website my very own self and surprise! Used car rates are the SAME! Whoda thunk?
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In the US, if you pay for a car in cash (as in a pile of 100's.....not a check), the dealer has to report it to the feds. Anything over $10k gets attention.
Meh, let them report it. Worst case you get some unexpected visitors, which is a great opportunity to make new friends.
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Ah yes, but in the US, nobody is paying anywhere near that much interest on cash and new car loans are just 2.24% at my credit union.
Used car loans are much higher interest.
I admit, I was lazy and just asked DH to look it up for me when I wrote the previous post. Just went to their website my very own self and surprise! Used car rates are the SAME! Whoda thunk?
Yep same here. Always finance at today's rates. Have piles of taxable savings. But why use it
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We have always writtten a check for every vehicle we've purchased. We then take care of them, maintain them, and drive them forever! My last car, Honda Accord, I drove for 15 years. Current Toyota Camry is 7 years old so we've got another 8 years, minimum, left on it!
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When my wife and I moved from Australia to the US we didn't have credit ratings, so we had to use savings to buy a car. Didn't have much of a choice in Houston, TX, due to the lack of public transport and the danger of using bikes on the road here. Got the wife a new Toyota Corolla for $17k, paid in cash - was expecting to be able to negotiate down price for cash, as this is usually the case in Australia. Here in the US people looked at me funny when I asked for a lower price because I was paying cash. I ended up knocking the price down from about $21k list to $17k after playing 3 dealerships off each other. That seemed to work better than offering to pay in cash.
When we did pay cash, it was like Toyotas system imploded. Their processes are so set up for putting people on finance, and they still run you through those processes and try and sell you on finance. I was really annoyed that we had to sit in various rooms for hours, while people ran us through paperwork that was designed for people who were getting finance on their vehicles.
BTW we have had so many issues with the electrics in the Toyota Corolla - my advice, avoid it.
Yes, us too! My husband actually turned to me and said, can we just give them the check and go?
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I know right! *Facepalm*
In the past I've mostly purchased 2-3YO used cars off private sellers. So much easier - I usually take my laptop, get them to sign a bill of sale, and I transfer the money to their account on my internet banking while they watch. Takes 10 minutes.
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I can't fathom buying a car for anything but cash. Even when I was a college student I bought my car for cash (it was super cheap).
Now I pride myself in driving a "beater" car that is in great shape, high miles, but worth far less than my single paycheck, lol.
If I ever get the car damaged, lost, etc, it's no big deal as it's worth less than a single paycheck. I can go and buy another car on the spot if needed.
I love my old beater though, it does everything I need. I even installed a back-up camera for it, a bluetooth radio, and it has all of the modern conveniences without the cost.
I feel sorry for people who waste money buying expensive cars that they waste spending hours to get to work and home.
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We spent the last six months living car free in Chicago, but the time finally arrived for us to purchase a family car and we did it all in cash. Don't feel like I can share outside of this forum, as I accidentally mentioned our cash purchase to my sister and she just rolled her eyes since having a car payment is the norm.
She's jealous
Good for you!!
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When my wife and I moved from Australia to the US we didn't have credit ratings, so we had to use savings to buy a car. Didn't have much of a choice in Houston, TX, due to the lack of public transport and the danger of using bikes on the road here. Got the wife a new Toyota Corolla for $17k, paid in cash - was expecting to be able to negotiate down price for cash, as this is usually the case in Australia. Here in the US people looked at me funny when I asked for a lower price because I was paying cash. I ended up knocking the price down from about $21k list to $17k after playing 3 dealerships off each other. That seemed to work better than offering to pay in cash.
When we did pay cash, it was like Toyotas system imploded. Their processes are so set up for putting people on finance, and they still run you through those processes and try and sell you on finance. I was really annoyed that we had to sit in various rooms for hours, while people ran us through paperwork that was designed for people who were getting finance on their vehicles.
BTW we have had so many issues with the electrics in the Toyota Corolla - my advice, avoid it.
I bought my 2010 Corolla brand new with 0% APR Financing for $17k (back then it was fairly common to get 0% financing on new cars). It now has 148k miles on it. Overall I've been happy with it--but you're right about electrical. I have a low tire pressure light that never goes off!
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Congratulations! My husband and I just barely did the same thing, in Chicago even! We've been living here without a car for the last 4 years, but now that we are on the cusp of having another kid, some things were just getting too difficult to do without a car, especially given that a lot of the L stops we use frequently don't have elevators.
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the time finally arrived for us to purchase a family car and we did it all in cash.
You literally walked into the dealership with a suitcase full of cash?
It's always been my dream to conduct such a transaction. Also - if I had enough money, I'd like to buy a small plot of land in the fancypants neighborhood where homes cost 5X what they should, just so you can say you live there. Then I'd proceed to get a mobile home delivered and live in it. Maybe do some deer skinning/gutting in the front yard or work on an old rustbucket car in the driveway while people drive by in their Mercedes.
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the time finally arrived for us to purchase a family car and we did it all in cash.
You literally walked into the dealership with a suitcase full of cash?
It's always been my dream to conduct such a transaction. Also - if I had enough money, I'd like to buy a small plot of land in the fancypants neighborhood where homes cost 5X what they should, just so you can say you live there. Then I'd proceed to get a mobile home delivered and live in it. Maybe do some deer skinning/gutting in the front yard or work on an old rustbucket car in the driveway while people drive by in their Mercedes.
I think having a suitcase of cash in hand would stress me out. I don't like having even $50 cash in my wallet. Its probably the thought that it could be lost or taken with little to no recourse.
A check or credit card provides a little insurance against that
Dropping a mobile home (or an other 'cheap' house) in the middle of Luxury Mews Estates does sound fun though..
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Dropping a mobile home (or an other 'cheap' house) in the middle of Luxury Mews Estates does sound fun though..
I was discussing it with some Mustachian coworkers and they brought up the idea that zoning regulations may prohibit a trailer as a residential structure. In that case, I would have a slab poured and construct a house using traditional methods. It would just have the exact exterior dimensions of a double-wide, and the same exterior materials, and would be indistinguishable from a trailer.
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Dropping a mobile home (or an other 'cheap' house) in the middle of Luxury Mews Estates does sound fun though..
I was discussing it with some Mustachian coworkers and they brought up the idea that zoning regulations may prohibit a trailer as a residential structure. In that case, I would have a slab poured and construct a house using traditional methods. It would just have the exact exterior dimensions of a double-wide, and the same exterior materials, and would be indistinguishable from a trailer.
Don't forget the old tires on the roof. :D
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I have a low tire pressure light that never goes off!
OT: Turn ignition to on, press and hold TPMS Reset button until the light flashes 3 times. If you let go after light goes off, it will come back on very soon after. Same issue on Sienna.
The earlier TPMS for toyotas worked by comparing wheel rotation, not by directly looking at tire pressure. So I'm not sure if that's your issue, but it may just be that simple. Our sienna's light was on for months until I learned that the reset is more than just pressing until the light went off the first time.
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I have a low tire pressure light that never goes off!
OT: Turn ignition to on, press and hold TPMS Reset button until the light flashes 3 times. If you let go after light goes off, it will come back on very soon after. Same issue on Sienna.
The earlier TPMS for toyotas worked by comparing wheel rotation, not by directly looking at tire pressure. So I'm not sure if that's your issue, but it may just be that simple. Our sienna's light was on for months until I learned that the reset is more than just pressing until the light went off the first time.
We had a similar problem with the "Engine Maintenance Needed" (paraphrasing, as I don't remember the exact words) light on my new/used Venza after DH changed the oil. It's about the same fix
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I have always hated the whole care experience which i why i figure out what I want to buy over the years be it used or new (now only used), pre-determine what I am willing to pay if its what I expected and write a check. The sooner I get away from the dealership or private party the better! :-) . Been that way most of my life. "let me ask my manager" arghhh. games! Go low and don't budge!
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Depending on how much the car cost. Don't think a car is necessary if you live in the city. We do and we don't have a car.
Wish we could live without a car, but we moved from Chicago to Minneapolis which changed the situation. I still plan to take transit whenever possible (once I figure out how it works here), and we'll find other creative ways to maximize having only one vehicle.
I see that makes sense. We lived in Rochester for a while and would go to the twin cities on the weekend. Hard to get around that place without a car.
Still hope you didn't spend 50k in cash ;)
Definitely not! Not a beater, but a practical and relatively inexpensive used vehicle.
Without knowing what car it is there's no way to tell if you really did anything prudent. While a payment may be a bad idea in most circumstances -- I would actually consider getting one at 2% interest. One version of the vehicle I want that is < 7 yrs old, <50k miles, another similar one is a 10 yr old car with 92k miles. I figure yu could be getting into some expensive repair with the older car; despite being able to pay cash for it.
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Great stuff! I have been explaining to alot of my colleagues why 0% finance deals on new cars aren't cheap when nearly new cars come with 20% off minimum.
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Great stuff! I have been explaining to alot of my colleagues why 0% finance deals on new cars aren't cheap when nearly new cars come with 20% off minimum.
OTOH, DH bought his 2002 Ford F150 that way when it was brand new. It just clocked 90k, is still going strong and looks great. This weekend we used it to buy new tall bookcases for the library at Ikea (ugh). On the ride over, I asked him if he wanted to start thinking about replacing it. "Nope, never" was his (unknowingly mustachian, bless his naturally frugal little heart) immediate response.
No truck hate, please. He is a painting contractor by trade. His current job includes a vehicle and he walks to work. We renovate houses, so it comes in handy. He also does his own maintenance.
Sometimes new does make sense. Buy and hold is more than just a good equities strategy.
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Great stuff! I have been explaining to alot of my colleagues why 0% finance deals on new cars aren't cheap when nearly new cars come with 20% off minimum.
Depends on the model, and the market, for sure. If one is not picky about thir vehicles, they can get by quite a bit cheaper, for sure.
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Just paid cash today for a new (to me) car. It's decidedly NOT mustachian. 2010 Ford Taurus, Limited. I paid the original owner bluebook value for it at $10,400. It's like new. Very very clean.
Reason I bought it? I got a new job, in outside sales. I can't carry samples and customers product on my bicycle or motorcycle (primary mode of transport for current work commute). Also, I need to present well, carry 4 full size adults on occasion, and get decent fuel economy while "looking the part" and getting decent fuel economy (I realize that's all relative).
I got 27mpg on the 60 mile drive home via interstate, in a two ton car. The 3.5L V6 is pretty reasonable when you keep your foot out of it.
The original owner paid $34.5k only 6 years and 85k miles ago. I bought a luxury sedan that has every single option available (except the sunroof) for 66% off.
The power of cash money presides as king in the used car market.
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Just paid cash today for a new (to me) car. It's decidedly NOT mustachian. 2010 Ford Taurus, Limited. I paid the original owner bluebook value for it at $10,400. It's like new. Very very clean.
Great deal, and the Taurus is one of those cars that seems to run a long time - http://www.cbsnews.com/news/will-your-car-last-for-200000-miles/
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Just paid cash today for a new (to me) car. It's decidedly NOT mustachian. 2010 Ford Taurus, Limited. I paid the original owner bluebook value for it at $10,400. It's like new. Very very clean.
Great deal, and the Taurus is one of those cars that seems to run a long time - http://www.cbsnews.com/news/will-your-car-last-for-200000-miles/
So far so good. We're pleased with it, it sure is fancy!
The last line in article you linked is especially apt for this forum.
"Every year that you can keep your car, pickup or SUV running well is a year you are not making payments on its replacement."
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We spent the last six months living car free in Chicago, but the time finally arrived for us to purchase a family car and we did it all in cash. Don't feel like I can share outside of this forum, as I accidentally mentioned our cash purchase to my sister and she just rolled her eyes since having a car payment is the norm.
what did you buy?
<--curious and loves cars.
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we bought a 2017 Prius in cash, considered getting cheap financing and investing the difference but $25k isn't a lot of capital and wanted to be done with it
Sent from my Nexus 7 using Tapatalk
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We're planning to do the same thing when we buy our next newish vehicle. That will make us happier than a $400+ payment each month. Still rocking a pair of $2K cars for now. Can't bring myself to sell them b/c they get the job done and we don't travel much these days. As soon as we decide to go further from home, we'll want something newish. Just can't see driving a 400K mi old vehicle cross country. ;)
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This is great and I wish this was just... normal. >_<
I got into a conversation with my dad once about buying cars and mentioned I'd paid cash for my previous car, a Camry (under $5k) and he a) was flabbergasted I had saved up that much cash to spend all at once and b) tried to lecture me that it was always better to lease "so you can build credit". Needless to say, I don't take financial advice from him, and I've never taken out a lease on a car in my life.
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This is great and I wish this was just... normal. >_<
I got into a conversation with my dad once about buying cars and mentioned I'd paid cash for my previous car, a Camry (under $5k) and he a) was flabbergasted I had saved up that much cash to spend all at once and b) tried to lecture me that it was always better to lease "so you can build credit". Needless to say, I don't take financial advice from him, and I've never taken out a lease on a car in my life.
Yes, talking about credit to a person who pays in cash. Great strategy. I know people who take out loans for stuff just for the 'credit'. I'll never understand it, especially when 730 (? or whatever the number is) gets one the best rates available and anything over that is basically pointless.
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we bought a 2017 Prius in cash, considered getting cheap financing and investing the difference but $25k isn't a lot of capital and wanted to be done with it
I see 1.9% financing on a Prius for 72 months, let's assume that instead of parting with $25K you hang on to it, invest it, and make the $368 monthly payment.
Had you gotten a 7% after-tax rate of return during that 6-yr time period. (the same interest rate I've seen MMM use), you would have come out $5,221 ahead!
That's a very expensive price for being done with it.
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we bought a 2017 Prius in cash, considered getting cheap financing and investing the difference but $25k isn't a lot of capital and wanted to be done with it
I see 1.9% financing on a Prius for 72 months, let's assume that instead of parting with $25K you hang on to it, invest it, and make the $368 monthly payment.
Had you gotten a 7% after-tax rate of return during that 6-yr time period. (the same interest rate I've seen MMM use), you would have come out $5,221 ahead!
That's a very expensive price for being done with it.
agreed
w major mistakes here IMO not a badassity move in anyway shape or form
1. its a brand new car.
2. paying cash when financing is available at those crazy low rates.
Half the time people post stuff like this i think this goes on the antimustachian wall of shame and comedy.
a quick CL search finds me a 2014 prius with 33k miles on it for 11900 ... assume i can get it for 11k. and used financing is aroudn 4% ... financing this and banking the 14k saved over new way more badass.
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1. its a brand new car.
2. paying cash when financing is available at those crazy low rates.
Half the time people post stuff like this i think this goes on the antimustachian wall of shame and comedy.
a quick CL search finds me a 2014 prius with 33k miles on it for 11900 ... assume i can get it for 11k. and used financing is aroudn 4% ... financing this and banking the 14k saved over new way more badass.
I've never had a brand new car. Maybe if I did, I would understand why people spend SO much money on them. It just seems so wasteful. I've never had any major issues buying used... just regular maintenance stuff.
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we bought a 2017 Prius in cash, considered getting cheap financing and investing the difference but $25k isn't a lot of capital and wanted to be done with it
I see 1.9% financing on a Prius for 72 months, let's assume that instead of parting with $25K you hang on to it, invest it, and make the $368 monthly payment.
Had you gotten a 7% after-tax rate of return during that 6-yr time period. (the same interest rate I've seen MMM use), you would have come out $5,221 ahead!
That's a very expensive price for being done with it.
agreed
w major mistakes here IMO not a badassity move in anyway shape or form
1. its a brand new car.
2. paying cash when financing is available at those crazy low rates.
Half the time people post stuff like this i think this goes on the antimustachian wall of shame and comedy.
a quick CL search finds me a 2014 prius with 33k miles on it for 11900 ... assume i can get it for 11k. and used financing is aroudn 4% ... financing this and banking the 14k saved over new way more badass.
We're not all from the USA you know. In Australia for example secured vehicle loans are ~7% interest if you have a decent credit rating.
Personally, I'm an expat - best rate I was offered on arrival to the US was 15% - because no credit rating.
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we bought a 2017 Prius in cash, considered getting cheap financing and investing the difference but $25k isn't a lot of capital and wanted to be done with it
I see 1.9% financing on a Prius for 72 months, let's assume that instead of parting with $25K you hang on to it, invest it, and make the $368 monthly payment.
Had you gotten a 7% after-tax rate of return during that 6-yr time period. (the same interest rate I've seen MMM use), you would have come out $5,221 ahead!
That's a very expensive price for being done with it.
agreed
w major mistakes here IMO not a badassity move in anyway shape or form
1. its a brand new car.
2. paying cash when financing is available at those crazy low rates.
Half the time people post stuff like this i think this goes on the antimustachian wall of shame and comedy.
a quick CL search finds me a 2014 prius with 33k miles on it for 11900 ... assume i can get it for 11k. and used financing is aroudn 4% ... financing this and banking the 14k saved over new way more badass.
Meh. $14K over the life of a car is what, a 75 dollars a month? As the op stated; it's not that much capital.
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Saving for a car for DD now. She's currently living at college but will commute starting in the fall.
So after not paying for next year's room and board and paying cash for a reliable used Corolla or Prius I'll still be close to $6,000 ahead!
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I've never had a brand new car. Maybe if I did, I would understand why people spend SO much money on them. It just seems so wasteful. I've never had any major issues buying used... just regular maintenance stuff.
+1 I've never bought a brand new car & neither has DH. At this point I think we never will. We buy reliable used cars and keep them a decade or more.
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I've never had a brand new car. Maybe if I did, I would understand why people spend SO much money on them. It just seems so wasteful. I've never had any major issues buying used... just regular maintenance stuff.
+1 I've never bought a brand new car & neither has DH. At this point I think we never will. We buy reliable used cars and keep them a decade or more.
I have bought 2 new cars in the past ( in my foolish 20's and 30's) - at least paid cash and kept 10 years or longer - BUT - what I can tell you was (1) the negotiation process was awful and (2) I was so nervous about getting the first scratch that it took a lot of pleasure away. So I have no desire to ever, ever, ever buy new again.
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My first car was a 2001 PT Cruiser, bought used from a coworker for $3,000... I was 17, and I'd managed to put away some cash from working since I was 14, so it was all paid by check.
At 128k miles now, I'm still driving that car, and I've fallen in love with the hatchback design! I moved across the country with all my belongings in that thing, even (with room for a copilot!).
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My first car was a 2001 PT Cruiser, bought used from a coworker for $3,000... I was 17, and I'd managed to put away some cash from working since I was 14, so it was all paid by check.
At 128k miles now, I'm still driving that car, and I've fallen in love with the hatchback design! I moved across the country with all my belongings in that thing, even (with room for a copilot!).
Jealous! When I took off after highschool graduation I fit all of my worldly posessions into a 2 door Alero. A hatchback would have been fantastic.
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the time finally arrived for us to purchase a family car and we did it all in cash.
You literally walked into the dealership with a suitcase full of cash?
It's always been my dream to conduct such a transaction. Also - if I had enough money, I'd like to buy a small plot of land in the fancypants neighborhood where homes cost 5X what they should, just so you can say you live there. Then I'd proceed to get a mobile home delivered and live in it. Maybe do some deer skinning/gutting in the front yard or work on an old rustbucket car in the driveway while people drive by in their Mercedes.
I'm living in that scenario, except the double-wide was there before the 8200 sf houses started being built all around. We don't skin & gut game out front, but we have a tractor & a "less than new" boat & jet skis parked out front. Dad has been here, on the lake, since 1976 & bought a couple of trailers across the cove. He gave us one last year, and I've been caregiving for him ever since (he's vision impaired & going through cancer treatment...so,strings were attached to the gift). It is funny to be farming in the front yard as the exotic imports ride by. All the other yard workers come in with their trailers in the mornings, but I'm living here. It's not as much "fun" as it sounds. They're friendly enough, but we don't have the same values or lifestyles. We look like peasants & they look like hungry land vultures lusting over our properties. When dad passes away we'll be selling and moving to a less developed lake, like things used to be here 40 years ago. We just don't need the golf course or yacht club. Fortunately my little double-wide has been a great investment, and we be able to swap it & the 1.2 acres it sits on for 80+ acres on another lake a couple hours south & still pocket over 4x what dad paid for the place. Talk about the power of saving, investing, and buying & holding! ;)