Finally Pulled The Trigger

[Laserjet3051]

Finally pulled the trigger and switched from commuting to work in my Jeep Cherokee to a slightly used Honda Fit. The gas savings is going to be IMMENSE (getting 40 mpg combined city/highway currently, using hypermiling technique). I could have paid for it cash in full, but with a 2.0% interest rate, I prefferred to maintain liquidity, and after all, 2.0% is less than inflation (2.76%), so the bank is literally paying me to take their money. Loving the car so far; after 5 days of driving, the gas guage needle is just starting to dip away from the FULL line.

It was down to a choice between the Leaf and the Fit for me, but the deal breaker was the Leaf range; just couldn't swing it.

[ysette9]

Congrats! Nice work and I hope you continue to enjoy the new-to-you car.

[nouveauRiche]

This is awesome.  Great work.  Did you sell the Jeep or keep it?

[minimalistgamer]

Congratulations. I am glad you are enjoying your new car! I am sure you did all the math, and you probably made a smart decision.

I happen to be on the side of Dave Ramsey when it comes to cars, so I would personally never take out a car loan.

[TomTX]

Congratulations. I am glad you are enjoying your new car! I am sure you did all the math, and you probably made a smart decision.

I happen to be on the side of Dave Ramsey when it comes to cars, so I would personally never take out a car loan.

With a 2% interest rate, unless you're someone who can't handle your money* - doesn't matter that much either way.

*Which would be the typical Dave Ramsey caller. Cannot handle their money. At all.

[minimalistgamer]

Congratulations. I am glad you are enjoying your new car! I am sure you did all the math, and you probably made a smart decision.

I happen to be on the side of Dave Ramsey when it comes to cars, so I would personally never take out a car loan.

With a 2% interest rate, unless you're someone who can't handle your money* - doesn't matter that much either way.

*Which would be the typical Dave Ramsey caller. Cannot handle their money. At all.

It doesn't matter what the "typical" Dave Ramsey caller is like to me. I am personally against taking out car loans so I will never do it or recommend it to someone else.

[Laserjet3051]

Congratulations. I am glad you are enjoying your new car! I am sure you did all the math, and you probably made a smart decision.

I happen to be on the side of Dave Ramsey when it comes to cars, so I would personally never take out a car loan.

With a 2% interest rate, unless you're someone who can't handle your money* - doesn't matter that much either way.

*Which would be the typical Dave Ramsey caller. Cannot handle their money. At all.

It doesn't matter what the "typical" Dave Ramsey caller is like to me. I am personally against taking out car loans so I will never do it or recommend it to someone else.

I used to be totally against car loans, until the split between inflation and the loan interest rate was in my favor. And just to be clear, I will be saving about $100 per month in gas with the Fit, and looking at a $189 car payment per month, thus resulting in a net cost of $189 - $100 = $89 per month.

And with it still under warrantee, maintainance and repais should be neglible cost. At $89/month?

Yes, I'll take it.

[runewell]

2.0% is less than inflation (2.76%), so the bank is literally paying me to take their money.

Inflation rate is not the same as the interest rate on loans.  I assure you the bank is not paying you anything to take their money, but you are paying 2% to borrow its money.  It is paying less than 2% on that same money and therefore making money on your loan.

[ysette9]

In our case (we just purchased a car last month) the money we used to buy the car outright would have otherwise parked its little butt in Vanguard, so on paper it wasn't the right decision to not finance the car. Practically speaking though, my time is limited and I'd rather spend it playing with my toddler or hanging out with my husband, so the hassle of lining up financing and signing all the papers to put it in place wasn't worth the amount of money I may have made by not buying it in cash.

Plus it is fun to hear the dealer dude go on and on about how only 3.5% of purchases of cars are cash (or whatever the number was) and what is special about the paperwork for the sale because we are paying cash, blah blah blah. :)

[TomTX]

Congratulations. I am glad you are enjoying your new car! I am sure you did all the math, and you probably made a smart decision.

I happen to be on the side of Dave Ramsey when it comes to cars, so I would personally never take out a car loan.

With a 2% interest rate, unless you're someone who can't handle your money* - doesn't matter that much either way.

*Which would be the typical Dave Ramsey caller. Cannot handle their money. At all.

It doesn't matter what the "typical" Dave Ramsey caller is like to me. I am personally against taking out car loans so I will never do it or recommend it to someone else.

*shrug* You're the one who anchored your position to Dave Ramsey, not me. That comes with baggage.

Like I said, it really doesn't matter much (financially) either way if you can handle your money. If paying cash makes you happy, great. If someone else thinks that's sub-optimal and wants to deal with the loan for a benefit of a few hundred or few thousand bucks, great.

[kelvin]

I had a 2007 Fit which I loved. Maintenance costs were negligible, I was able to do a lot of the work myself. It was totaled in a hit-and-run at 189,000 kms. It was just starting to need "actual" maintenance beyond brakes/oil/winter salt protection. I still wish I owned that car.

Currently biking to work, saving up to buy another one this winter. I hope yours treats you half as well as mine did!