Did you finance or pay cash?

[Plala]

I'm thoroughly impressed. You clearly understand numbers, but think the opportunity cost of not having $40,000 to $60,000 available is less than $1156 (the cost of a 1.49% loan spread over 36 months). My friend, if you can't make $1156 on $40-60k in 3 years then we will never come to agreement. But what we can mutually agree to is you should definitely stick to paying cash.

Owie. My head hurts.

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[Plala]

I haven't decided yet, but I'm leaning toward leasing for one reason, Carfax. In today's world all accidents even minor ones get record on Carfax and the resales value gets hammed. Ever try to sell a cars with a Carfax accident? I'm planning on a 30% down, lease it for 3 years and if no accidents then buy out the lease. This is contingent of the lease interest rate, if it is too high, I would then consider financing. But if either interest rate is over 2% it will be cash.

But I need to get mine, Ford has messed up my order!!! 540+ days and still waiting.

I didn’t think Ford was offering a leasing option on the Bronco!!

 

[PDiddy]

I put down about half and then did a 3 year loan.

There’s no one way to skin this cat. We are all in so many different financial situations.

 

[RynoRanger]

i put 10 down (5 cash and 5 on a card with points (most they'd let me do on a card)) and financed the rest. going to do 13 payments then just pay it off. wanted to get some beneficial credit from it and seemed to work out well that way.

 

[CyberOrangeFanatic]

Got a preposterous 12% more for my trade-in than I paid for it a year prior. Paid the rest in cash. The trade-in market is stupid at the moment. People want to harp about ADM's but nobody is talking about how much you can get for used desirable vehicles right now. There's plenty of money to be had on trade-ins/sales of your used vehicles.

 

[Richtor]

My 4Runner will get me over half way there, and the current trade-in negotiation is for more than I paid for it in 2017. Taking the trade-in off my balance will drop my sales taxes by around $2600-2700. The balance will be paid through a loan from my own whole life insurance policy, which will continue to pay me 6%+ in dividends while I pay myself back.

I make my living off understanding opportunity cost and time value of money. Paying cash when rates are this low brings a high opportunity cost, so long as you invest the money. No one who can pay cash but chooses to finance should be blasted here unless they say they will finance the Bronco and spend the “saved” cash on a bass boat to tow behind it.

Dave Ramsey has his place, for those who need a plan to get out of financial trouble that financial illiteracy and/or bad decision making earlier in life got them into. It’s a very safe way to get out of debt and achieve a million or two in the bank by retirement. But a million dollars ain’t what it used to be, and it really won’t be in 20 years. 8 figure millionaires understand how to use debt and leverage.

I know of a number of 8 figure millionaires. A number of them are bankrupt and a couple others took their own life. That’s what debt did in their lives.
Dave is a 9 figure millionaire all with zero debt. So don’t tell anyone it can’t be done. Many billionaires are debt free and stress being debt free while building businesses.

Income is the primary source of building wealth not debt.

 

[Moya7]

Ah, sorry I missed that just joined this site!

Nice breaking in your just got there. And welcome to the craziness!

 

[Roger123]

If your going Dave R then why did you buy new?

Cause you have over a one million net worth, no debt, and your toys are less than 50% of your annual income.

 

[AZ_BRONC]

I know of a number of 8 figure millionaires. A number of them are bankrupt and a couple others took their own life. That’s what debt did in their lives.
Dave is a 9 figure millionaire all with zero debt. So don’t tell anyone it can’t be done. Many billionaires are debt free and stress being debt free while building businesses.

Income is the primary source of building wealth not debt.

There is good and bad debt. This thread presents a simple illustration.

You have $50,000 cash. You can:

1. Choose to substitute that cash for a $50,000 luxury item that will eventually depreciate over the next 10 years (believe it or not, that will happen eventually). Now you have $50,000 less cash and a Bronco. After 10 years, you have a 10 year old Bronco. Let’s be generous and say it maintained 80% value and is now worth $40,000.

2. Choose to put $50,000 into I treasury bonds and some TIPS or similar low risk investments paying 6-7%. Finance at, say, 2%. Simply don’t be stupid and buy a boat with the cash instead. Reinvest the net 5% gain in more treasury I bonds. After 10 years, you kept you cash as a $50,000 asset that pays a minimum 5% net gain and compounding semi-annually is now $81,930-principal paid 10 years in, plus the value of your 10 year old Bronco at $40,000. That‘s about $32,000 interest plus a $40,000 vehicle, for a total of $72,000.

3. Do what I explained and use the crazy used car market and state sales tax advantages of a trade-in, borrow the rest from yourself in the form of a policy loan from a mutual whole life policy I set up years ago for just this sort of thing. Buy that policy with the $50,000 cash savings you normally build up to pay cash for cars, or keep around as “emergency cash”. You will make a minimum of 6% guaranteed return plus variable dividends on the money borrowed, use that to purchase PUA’s (paid up additions) which adds even more value to your cash value of your policy and faster growth from dividends and guaranteed interest payments, and pay yourself back on any time schedule that fits your situation. Rinse and repeat every time you purchase a vehicle, or even a house if your policy cash values grow that big. By the end of this strategy you will have an insurance policy with a death death benefit of $1,000,000+ throughout your life, and a cash value accessible for 20 2050 electric Broncos if you so choose. I understand this is too complex for 95% of the readers here, but it is actually quite simple and available to anyone healthy enough to qualify for a whole life policy, and one of the strategies the truly wealthy use. There are others, this is just one example.

Opportunity cost and velocity of money are very real, and a misunderstanding of them cause a lot more bankruptcies and suicides than good understandings of them. Dave Ramsey is rich by being an entertainer who is very good at selling 9th grade economics, and what he does is very good for the average Joe who otherwise would be living their lives burdened with bad debt.

 

[Richtor]

There is good and bad debt. This thread presents a simple illustration.

You have $50,000 cash. You can:

1. Choose to substitute that cash for a $50,000 luxury item that will eventually depreciate over the next 10 years (believe it or not, that will happen eventually). Now you have $50,000 less cash and a Bronco. After 10 years, you have a 10 year old Bronco. Let’s be generous and say it maintained 80% value and is now worth $40,000.

2. Choose to put $50,000 into I treasury bonds and some TIPS or similar low risk investments paying 6-7%. Finance at, say, 2%. Simply don’t be stupid and buy a boat with the cash instead. Reinvest the net 5% gain in more treasury I bonds. After 10 years, you kept you cash as a $50,000 asset that pays a minimum 5% net gain and compounding semi-annually is now $81,930-principal paid 10 years in, plus the value of your 10 year old Bronco at $40,000. That‘s about $32,000 interest plus a $40,000 vehicle, for a total of $72,000.

3. Do what I explained and use the crazy used car market and state sales tax advantages of a trade-in, borrow the rest from yourself in the form of a policy loan from a mutual whole life policy I set up years ago for just this sort of thing. Buy that policy with the $50,000 cash savings you normally build up to pay cash for cars, or keep around as “emergency cash”. You will make a minimum of 6% guaranteed return plus variable dividends on the money borrowed, use that to purchase PUA’s (paid up additions) which adds even more value to your cash value of your policy and faster growth from dividends and guaranteed interest payments, and pay yourself back on any time schedule that fits your situation. Rinse and repeat every time you purchase a vehicle, or even a house if your policy cash values grow that big. By the end of this strategy you will have an insurance policy with a death death benefit of $1,000,000+ throughout your life, and a cash value accessible for 20 2050 electric Broncos if you so choose. I understand this is too complex for 95% of the readers here, but it is actually quite simple and available to anyone healthy enough to qualify for a whole life policy, and one of the strategies the truly wealthy use. There are others, this is just one example.

Opportunity cost and velocity of money are very real, and a misunderstanding of them cause a lot more bankruptcies and suicides than good understandings of them. Dave Ramsey is rich by being an entertainer who is very good at selling 9th grade economics, and what he does is very good for the average Joe who otherwise would be living their lives burdened with bad debt.

1. Cash
2. Cash
3. You can still do that in cash investments.
All (good debt, your words) allow you to do is get there slightly faster, with the risk of taking a lot longer and or bankruptcy.

4. Our system of fiat currency was set up to make people think paper is valuable. When all it does really is to allows the elites and those that own the banks to steal trillions of dollars from people around the world. It’s a big con game. Debt is the con. Yes you can make pennies on the dollar through debt but you can also lose it all.

 

[Broncojbl]

0.99% for 36 months
https://www.penfed.org/auto/rates

Clicking on the link you posted, the lowest rate they offer today is 4.59%. I thinK you may have an old page in cache (pardon the pun).

 

[KompressorV12]

Clicking on the link you posted, the lowest rate they offer today is 4.59%. I thinK you may have an old page in cache (pardon the pun).

Correct, my post is from January 19, 2022

 

[Broncojbl]

Correct, my post is from January 19, 2022

oops… sorry!

 

[VNVET]

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 totally true. My net worth is “comfortable”, my cash on hand is decent, I also have 8 credit cards with low apr’s that only carry a balance for 30 days. My fico 8 score bounces from 845 to 850. Mortgage paid off, everything I own not the bank.
You can get an 850 score, credit history, ask for a large credit limit, never spend over 30% of your limit. it is commonly recommended to keep your total credit utilization rate below 30%. For example, if your total credit limit is $10,000, your total revolving balance shouldn't exceed $3,000.
All of my credit cards have high limits, this means I can basically buy something and pay it off within 30 days and it will not negatively effect my credit score.

 

[da_jokker]

Finally got my Bronco.... Finance rates are easily 4% or higher..... Opportunity to invest that money with a -20% market that still may see another 10 to 20% downturn in 2023...

I paid cash.

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