Hello fellow Mustachians!
I've got some crazy idea in my head and I can't figure out if it's from here or out of my ass. How feasible is it to "loan" yourself money from your investments which you then pay back? The main idea is to avoid any losses getting financed or a loan from the bank. Here's the back (hypothetical) story:
I'm currently making roughly $25,000. I have investments of roughly $70,000, which increase by about 2.5% a year. I want to buy a car that's $15,000. Option one is to save up $5,000 each year for three years while investing $5,000, which by my calculations comes out at the end of year three with just over $90,000 in investments. Option two is to "loan" myself $15,000 (which means withdrawing $15,000 from my investments), buying the car right now, and then paying myself back (reinvesting) at a rate of $10,000 a year (which I would normally try to do even without buying a car). I calculate that at the end of year three my investments would stand at--you guessed it-- just over $90,000.
Am I actually talking sense, or should I burnish my stoicism skills by deferring the pleasure of buying a car right away?