If you spend $40k cash on a car, you get a car. If you take out a loan at 5% for 4 years, you pay that much more than just $40k over those 4 years.Let’s say you have 40k cash. Boomer David Ramey mentality is to pay that 40k cash and buy a car
The smart way to do it is to get the lowest apr term possible. Even now in thesety times you can get 5% loans on 48 months
If you take that 40k, and invest it in a simple index fund, you will gain 10% yearly compounded based on historic data.
If you spend that 40k cash and buy a car u get nothing.
You have a great UPS job…. So how much is your CAR payment? Be honest 👀
- Thread starter Over70irregs
- Start date
Faceplanted
Well-Known Member
You’re totally not understanding what I’m saying.
If you have 40k cash here are your two options
1. Buy a car for 40k.
2. Take that 40k, and put it in the s&p. 4 yeas Assuming historic 10% Apr returns. 40k = 58564. Get a loan for 40k 48 month. 5% apr = 48k total spent depending on taxes/registration ect
10k profit in getting a car loan. This doesn’t take into account inflation
NEVER pay cash for any big purchase. You use loans aka leverage to increase your investments
I don't gamble my money. No thanks.
Faceplanted
Well-Known Member
Gamble. Uh ok. Enjoy working until your 55
Over70irregs
Well-Known Member
We are a credit economy. Everything ceases without it. Great post.
clean hairy
Well-Known Member
Guns n Roses were popular...
Analbumcover
ControlPkgs
The newest vehicle I drive is my Ford package car. Only 16k miles and it beeps like a little bitch whenever I get within 5 feet of the center line.
I have NOT been lurking
Eat. Sleep. Work. Jork.
Lemme guess, Silverado
DriverNerd
Well-Known Member
For that to be true you must be able to afford a $1000 per month car payment and do you really believe you're getting 10% return over the next few years?
Otherwise, sure.
iowa boy
Well-Known Member
I have NOT been lurking
Eat. Sleep. Work. Jork.
Get a cam
Brown Down
Well-Known Member
750 for my wife's car that we travel in. I have a beater to drive the short distance to work. But I also pay off my car loans as quick as possible. Just not to the point to get a nice car for travel with cash but getting there quick.
catstalking
ie qt
so what happens when our market resets to the actual historical mean due to our intense debt and the "historic 10%" becomes 1-2% if you're lucky
you're using return figures from a PUMPED half century and assuming that will just keep happening forever, maybe you're right maybe you're not but it's NOT a sure thing
catstalking
ie qt
here's the other problem, you're also assuming you can't possibly lose your job or have anything happen to your ability to pay your loan
if you buy with cash, no matter what happens you own transportation and some idiot in DEBT probably doesn't anymore
hard assets ALWAYS win over debt and IOU
Faceplanted
Well-Known Member
Just 2 more weeks and the economy will collapse
Next Day Err
Well-Known Member
$0 car payment. Ready for my next car paid in full with cash when the time comes.
catstalking
ie qt
it'll collapse when the right confluence of banks and/or real estate schemes finally break the dam
could be 2 weeks, could be 2 years, heck maybe we get lucky and it's 2 decades
Thebrownblob
Well-Known Member
Sweet
Next Day Err
Well-Known Member
Exactly. One cannot accurately predict economic crises. One can only get lucky.
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