Comments on: Car Loan Payment or Pay Cash For A Car?

By: Me

Me — Wed, 07 Dec 2011 00:16:36 +0000

Once in a while, car companies have good financing deals like 0.9% for 60 months + no money down, etc… A typical saving account’s APR is around 1%. So, financing and not paying by cash can be a good thing. It happened to me last year. I have a saving account with Discover Bank for 1.5% APR. So instead of paying cash for my Honda Fit, I opted to finance for 0.9% for 60 months and pocket the difference

By: mike

mike — Wed, 06 Jul 2011 08:32:55 +0000

It is better to buy a second hand car for cash always. They can be sold for a smilar price withing 2-3 years and then upgrade again. Interest rates are just too high.

By: Ron

Ron — Fri, 08 Apr 2011 10:26:02 +0000

Thanks a lot for the information, i subscribed to your rss feed , in this time of crisis we really need to save money in our cars , credit cards etc.. or we will not reach the pay day !

Thanks,.

Ron

By: Craig

Craig — Wed, 06 Apr 2011 21:19:03 +0000

Dylan,
Welcome. I don’t edit comments just because I disagree. So according to your calculations borrowing money is cheaper than buying it with cash? Or are you just saying it’s not as big of a difference as this post indicates.

By: Dylan

Dylan — Wed, 06 Apr 2011 08:52:05 +0000

I don’t expect this to reach the site but if it does…I’ve studied finance…certain calculations have been conveniently left out and this article leads people to the wrong conclusion. e.g. A $10000 car today is not equal to a $10000 car tomorrow due to the effects of inflation – which are huge. There is no value placed on owning a car for 4 years. In this example there is no cost associated with NOT having the car (opportunity cost). There are a tonne of scenarios where a person will be better off to borrow instead of save. If you need to work it out just look up how to calculate net present value of an investment (car, house, anything). There is so many vital calculations left out – yes, if you leave them out, it makes it look like borrowing is a demon. Be sure though, it’s not. It can open you to new opportunities, you just have to take the time to learn and do it with sound judgement.

By: Jason Kay

Jason Kay — Sun, 07 Nov 2010 19:52:11 +0000

Some good information. Especially in the current economic climate.

By: 4 Habits of Millionaires

4 Habits of Millionaires — Fri, 22 Oct 2010 14:50:23 +0000

[...] Ouch. This one hits home. How often do we buy things based on what others will think? People often talk about teen spending and consumerism, but what about adult spending? A person who is upside down and in debt still thinks they can afford a car payment. [...]

By: trademan

trademan — Thu, 21 Oct 2010 13:29:38 +0000

Really good article, it would help me out the save my money.

By: umair

umair — Mon, 30 Aug 2010 08:07:54 +0000

Good to know this information. This is a great HELP to all especially those in need of financial assistance for their loans. Good Article!

By: Palm Beach Used Cars

Palm Beach Used Cars — Mon, 31 May 2010 06:30:42 +0000

Having cash is always best. You would all be surprised if you knew how many people with bad credit are willing to pay higher percentage rates for a used car.