Author Topic: Take some gains out now to pay for large expense next year?  (Read 868 times)

Dusty Dog Ranch

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Take some gains out now to pay for large expense next year?
« on: November 12, 2017, 06:26:43 PM »
At some point before the winter of 2018-2019, we need to buy a piece of equipment, either a UTV or tractor, for the ranch. With implements, like a plow, we're probably looking at 10-20k. What do you think...do I pull it out of our taxable VTSAX and/or VTIAX now and stash it in the Ally savings account or wait until we are ready to buy?

Other factors to consider:

We reduced hours and income at work in July, so I don't think the 20k will look like extra income compared to last year, taxwise (I haven't run the numbers, though).

We have a CD ladder with one year's expenses and 8k of that will be available in August.

The local tractor dealership usually has 0% financing for its major brand...the green and yellow one...but do we want to take on a monthly payment? We have no debt currently.

I have been scouting for deals on used, but they are really scarce. If anyone has any tips on this front, let me know!

Goldielocks

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Re: Take some gains out now to pay for large expense next year?
« Reply #1 on: November 12, 2017, 08:39:12 PM »
At some point before the winter of 2018-2019, we need to buy a piece of equipment, either a UTV or tractor, for the ranch. With implements, like a plow, we're probably looking at 10-20k. What do you think...do I pull it out of our taxable VTSAX and/or VTIAX now and stash it in the Ally savings account or wait until we are ready to buy?

Other factors to consider:

We reduced hours and income at work in July, so I don't think the 20k will look like extra income compared to last year, taxwise (I haven't run the numbers, though).

We have a CD ladder with one year's expenses and 8k of that will be available in August.


The local tractor dealership usually has 0% financing for its major brand...the green and yellow one...but do we want to take on a monthly payment? We have no debt currently.

I have been scouting for deals on used, but they are really scarce. If anyone has any tips on this front, let me know!

YES!

Anytime you have a large (to you) purchase coming up in the next 3 years, you look for an upswing in the market, and pull cash early.   It sucks to pull out cash after a 20% drop.

The only reason not to do this is if you are truly preferring the finance offer, or it is neg. difference to you.  e.g., if the market goes down, would you still buy the tractor?  If the market goes up, would you still be attracted to 0% financing?

Catbert

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Re: Take some gains out now to pay for large expense next year?
« Reply #2 on: November 13, 2017, 11:52:08 AM »
+1  Another "yes" for all the same reasons.