Did you finance or pay cash?

[Bert20000]

My dealer got me a 1.87% rate through Trust after I showed them the PenFed 1.99 rate. I have excellent credit, which helps.

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[BR0NCO]

I get the investment thing, but I am paying cash because writing a $1000 check every month will sting. I can easily afford it, I just don’t like owing money. I’ve been saving up and putting aside since I reserved the Bronco. I will invest the $2k I’ve been saving every month, my mortgage will be paid off this summer and I will be investing those payments as well. I can live the same life style with an additional $7k to invest every month with no debt.

 

[TyGuy40]

You need to take risk into the equation. How many people need a working spouse to keep making payments? Who's raising your kids while they're working? What happens if a breadwinner gets sick and has to take a leave of absence and the other spouse does too to care for the sick spouse or the children? And all of this happens in 2008? Remember being invested in '08? Go from 2 incomes to ZERO overnight, now what? Once again, no payments, not a big deal.

If a spouse gets tired of working, quit, no payments, no problem. Oh, no worries I'll just pull all the money out of my investments (that would have been a great plan in '08). Remember risk?

What if I get tired of working and just want to ride off into the sunset in my Badlands, no payments, no problem.

No one here will change each others minds in this discussion but for those of you starting out, please don't think that having a car payment is the American way and you'll just invest and watch your money shoot to the moon like it has in the last 15 years.

Take some time and think about the big picture, and risk my friends NEEDS to be factored in. Not owing anyone anything is peaceful, you have ZERO risk. Yes, you have some risk of not beating inflation and your money not growing but a good financial plan will allow for that.

I've never heard anyone with no payments say they'll have to work until the day they bury them.

I think all this is great advice. Risk is important to factor, and being in debt to NO ONE is a wonderful feeling. I calculated the risk, and opted to for a hefty downpayment, while financing the rest, mainly because money was super cheap (1%), and I have no kids, none on the way, and I just turned 40. Young enough to still invest in other things, old enough to know I won't be vertical forever, and you can't spend your money when you're dead. So I bought my dream car (or at least I bought the Bronco that was still going to be a pleasure to drive, and NOT cost me over 150k.

One of the happiest days of my life.

 

[petengineer]

I wanted to pay cash, but my dealer said I wasn't "allowed" to do that here in Canada because it'll be flagged for money laundering....

Well since your transaction is legitimate, nothing to worry about right........unless....

 

[Squatchn']

I paid cash. I got so much money on the trade in for my Ranger that it pretty much didn't make sense to take out a loan. Plus I recently bought my wife an Explorer back in September and we financed that car, and I didn't want to have 2 car payments.

 

[Delli555]

I get the investment thing, but I am paying cash because writing a $1000 check every month will sting. I can easily afford it, I just don’t like owing money. I’ve been saving up and putting aside since I reserved the Bronco. I will invest the $2k I’ve been saving every month, my mortgage will be paid off this summer and I will be investing those payments as well. I can live the same life style with an additional $7k to invest every month with no debt.

I agree. I hate having big monthly payments so I will be putting down as much cash as I can and finance the rest.

 

[CyberOrangeBadlands]

Correct in assuming dealerships want you to finance as much as possible because they are getting a piece?

Do they give you any incentives for paying all cash? Add’l features, throw-in’s etc - or are those days long gone?

If your plan if to pay all cash when do you let them know that? After you get the walk out the door price and after they try to sell you their laundry list of add-ons?

Guessing they are well versed in doing their best in steering you away from paying cash for the entire bill.

 

[croaton]

I sold my 2019 charger scat pak for $7000 more than I paid. So I only had to put $2500 out of pocket to buy my bronco out right.

 

[bikearch]

I paid cash...because i wanted too!!

 

[Jazer]

We will probably finance around half and pay cash for half. I get the whole free money thing and financing with low rates (we have 0% interest on our Stinger with Kia financing, so that would be dumb to pay out).. but I don't like the idea of paying 1000$ payments every month. Sure we could do it but would rather not, lol. I like having low monthly payments (If I have to have one).. and not owing anyone anything. I hate having debt. I feel like this is a reasonable middle ground.

 

[bluford]

Five years ago I got a credit card to handle daily purchases, and I pay it off in full every month. It's a great way to build credit as long as you have the self-control to not overspend.

Exactly!! Dave Ramsey has some good thoughts/ideas/plans on saving and getting out of debt but it is very difficult to live without credit. Just be smart and don't spend what you cant afford. And Dave Ramsey has lost all credibility with me because of how he runs his company and how he treats his staff unfairly (the staff who he isn't best friends with or staff who are not the big faces of the company that bring him lots of money).

 

[PowPow]

Five years ago I got a credit card to handle daily purchases, and I pay it off in full every month. It's a great way to build credit as long as you have the self-control to not overspend.

yeah man, I got a chase card with those sweet rewards/points. So I literally put everything on my credit card and pay it off in full. It's more like a charge card than a credit card. I set a budget, and work within that budget for each of the items getting charged to it. (groceries, cable, hulu, etc...)

I easily earn $1000's of dollars in cash back every year because of this. and since it's paid off in full, never any fees. If I could, I'd put my mortgage payment on my credit card, but my lender doesn't allow for that.

It's a great way to build & establish credit. My score is over 800. And has been for 10+ years.

Just like you said though, you have to have control and a good tracking/budgeting system. Otherwise you can lose track pretty easily since it's just going to a card.

I never have cash on me. Like never. I get annoyed when my kids classroom parent or whatever asks for $5 for the class party and to send it in via cash. umm, it's 2022. Have you heard of this app called Venmo?

 

[DrewBronc21]

I still believe the math will almost always show taking a low interest loan for as long as possible and keeping your cash, investing somewhere else, etc. is the better financial move.

You need to take risk into the equation. How many people need a working spouse to keep making payments? Who's raising your kids while they're working? What happens if a breadwinner gets sick and has to take a leave of absence and the other spouse does too to care for the sick spouse or the children? And all of this happens in 2008? Remember being invested in '08? Go from 2 incomes to ZERO overnight, now what? Once again, no payments, not a big deal.

If a spouse gets tired of working, quit, no payments, no problem. Oh, no worries I'll just pull all the money out of my investments (that would have been a great plan in '08). Remember risk?

What if I get tired of working and just want to ride off into the sunset in my Badlands, no payments, no problem.

No one here will change each others minds in this discussion but for those of you starting out, please don't think that having a car payment is the American way and you'll just invest and watch your money shoot to the moon like it has in the last 15 years.

Take some time and think about the big picture, and risk my friends NEEDS to be factored in. Not owing anyone anything is peaceful, you have ZERO risk. Yes, you have some risk of not beating inflation and your money not growing but a good financial plan will allow for that.

I've never heard anyone with no payments say they'll have to work until the day they bury them.

If the spouse loses their job you still have the cash because you didn’t put it all into buying a car for cash. If you want to ride off into the sunset in your Badlands, you can do that and keep your money working for you, not all in your Bronco. Most successful investors in real estate, etc will always keep their money and use low Interest financing to make more money. Would you buy a $500k house in cash with 2% interest rates?

With that said, I’m about to pay off a 6 year low interest car loan in less than 2 years so I didn’t even follow my own financial beliefs lol. Why did I do it? Emotion not math. Looking to get my Bronco and didn’t want two car payments. I don’t want the FEELING of two car payments even though by keeping the cash you will always have the money.

 

[Kos]

I wanted to pay certified cheque. They straight up said I cant because of laundering. I too was able to put 2k on CC for points. I dont know, I believe they could be screwing with me. My dealer is on this Forum, perhaps he will chime in :/ They mentioned also they wouldnt be able to get it over the border if I paid cash... and there would be extra fees/taxes. Im too gullible I guess and was too intimidated to speak up.

Sounds like they wanted you to finance so they would get the kick back (not sure how it works in CAN, but that's how it typically works in USA). I've "financed" vehicles before to get extra incentives from the dealer (usually $1,000) and because I get easily confused, I accidentally send in the full outstanding balance instead of the monthly payment.

Got the title in hand 2 months after I take it home and an extra $1K in my pocket.

 

[ChetC]

At the end of the day no matter how the math is done I just sleep better knowing that I don't owe anyone anything. If I was paying cash and not investing because of that it would be an issue but I max out all tax advantaged investments every year. I know I'm missing out on taxable gains but it becomes more emotional than monetary for me at a certain point.

I'm with this guy. After living most of my life with payments and debt, I finally achieved a debt free status a few years ago. I'm not super wealthy and I've sacrificed a lot to get to this point, but the feeling of having no payments outside of utility bills is incredibly freeing and removes far more stress from your life than you can imagine. For me, that's the interest I'm making on my cash Bronco purchase, an investment in my mental well being and I can assure you that's worth more than a couple of percentage points over five years.

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