Did you finance or pay cash?

[choppersean]

Paying cash is an emotional thing and people continue to do it when the math is proof that it’s wrong.

Amen!!

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[DFNMAN]

Yes, but often nigh net worth people and high cash on hand people have zero credit because they don't have cards or mortgage. Can't get those rates with sub 800 credit scores that come with utilization of debt

Not true at all. They take advantage of low interest rates and put the money elsewhere. A FICO score over 700 with an aged credit history will get you a good rate from any lender.

 

[choppersean]

Where did the "puke" emoji go? If you can finance at 2% but invest the "cash" amount at 5%+ in say an index fund, why wouldn't you? Scratching my head on the logic. For those with truly secure financing, this seems illogical.

 

[RClark82]

Not true at all. They take advantage of low interest rates and put the money elsewhere. A FICO score over 700 with an aged credit history will get you a good rate from any lender.

OK, I'm sure someone with 700+ can. I'm talking about a zero credit score from many years of not using debt in any form.

 

[RClark82]

Where did the "puke" emoji go? If you can finance at 2% but invest the "cash" amount at 5%+ in say an index fund, why wouldn't you? Scratching my head on the logic. For those with truly secure financing, this seems illogical.

Risk

That index fund has no guarantee.

 

[DFNMAN]

OK, I'm sure someone with 700+ can. I'm talking about a zero credit score from many years of not using debt in any form.

Right, but high net worth individuals almost always have credit. Even if they didn't, banks will make exceptions if you have assets.

 

[choppersean]

Also....amazing people are equating an investment option as a "savings account." If that is your only risk tolerance, by all means, pay cash. I am very conservative with my investments and even a lower risk index fund is FAR better than a savings account or treasury bond.

 

[choppersean]

Risk

That index fund has no guarantee.

Risk tolerance and proven track record on my investments. Your choice, but I'll make more in my return on investment by financing.

 

[Big Diamond]

that is exactly what I did. Plus my loan was basically free. there’s always a risk in the market if you’re going to do investments but ultimately for me I’d rather put that money to work either through real estate, stocks, crypto etc.

I wan't to dabble with crypto, but I'm worried I "missed the boat" already and also I'm a chicken shit with investments (says guy in the restaurant business, lol)

 

[Bronco Finder]

I wan't to dabble with crypto, but I'm worried I "missed the boat" already and also I'm a chicken shit with investments (says guy in the restaurant business, lol)

Gold and silver is safer. Lol.

 

[FlyingScot]

If there are people that paid cash I'm going to question their intelligence level with penfed giving 0.99% APR loans there are literally high yield savings accounts with higher than 0.99% return. Unless you're keeping your DTI low for other reasons, have terrible credit, or enjoy throwing money down the drain it makes zero sense.

Edit: Retirement is the worst excuse one could have for paying cash for the car lol. In retirement, any income no matter how small is even MORE important than those working.

I understand this is a generational thing. Many boomers grew up to 12% mortgages and 15% auto loans, but times have changed. Borrowing money is nearly free these days, and inflation is at record levels. You absolutely should have a significant rainy day fund, but keeping tens of thousands or hundreds of thousands of dollars in cash (instead of safe CD's, high yield savings accounts, or bonds) is the best way to get left behind in 2022.

Came here to post pretty much this. Very few good reasons to cut a check that big for anything right now.

 

[calgecko]

I see people throwing around PenFed at 0.99%.. you know that's "As low as" 0.99% , "up to 36 months" .. .most people will need much more than a 36 month loan on a $60k vehicle.

 

[RagnarKon]

I was going to finance because, as other said, with interest rates being what they are it is often cheaper overall just to let your money grow elsewhere.

BUT...

1. Interest rates are probably going to go up on loans before I get my Bronco. (Yay inflation.)
2. Higher interest rates will lead to less return on my other investments
3. My property currently borders farmland on 3 sides. Found out about 8 months ago that the farmer is retiring and selling his land. The top bidder is a real estate developer best known for building some of the largest warehouses in the country. So... needless to say I may be moving soon, and I'll want my credit squeaky clean for a mortgage.
4. It has taken so long to get my Bronco that I am now flush with cash that normally would have been spent on a car payment

So I may ultimately pay cash.

Or... more likely than not... I'll just put down a monster down payment and get a 3-4 year loan so I can go after the lower rates. Depends what the Fed and the market decides to do between now and when I get my Bronco.

 

[AddDemiGod]

I wan't to dabble with crypto, but I'm worried I "missed the boat" already and also I'm a chicken shit with investments (says guy in the restaurant business, lol)

Just put small amounts that you wouldn't care to loose, you're always going to feel like you missed the boat when something comes on to your radar. I'm sure people were saying that they missed the boat and it's too late to invest in bitcion when it reached $1k and it was going to drop now, but it kept going up. The only thing I would use as a strategy when it comes to "meme stocks" is to pull out or take a portion of the profits when it spikes. Other then then that, follow Elon Musk on twitter haha.

 

[OkieB6G]

I financed mainly because of low interest rates, and being able to grow that money elsewhere.

Exact same here. With such a low interest rate, I'd rather put my cash somewhere it'll work for me instead of into a depreciating asset.

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