How are you planning on purchasing your Z? / Lease or Buy?

How are you paying?


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Yasha

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Thinking of just leasing it for a few years, then deciding whether I wanna keep it long-term. It's better to use my capital on more traditional assets, then use some of the capital gains to pay the residual value. Will also allow me to change vehicles if life changes the way it usually does for a bachelor...
 

Lvckv69

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Paying cash since it's going to be a toy. Debt for a toy never made sense to me :)
I would never pay cash. Financing a car works better if you have good credit. Take a little bit of that cash and put a down payment on it. Take the rest of the cash and invest in stocks and bonds, your return on investment will be higher % than your loan interest. By the time you pay your car off, you will make that interest back with the investments and now you will have some liquid cash for savings. Cars are the worst way to lose money, because they depreciate so fast. If you are not into finance/investment, then nvm lol.
 

Denver the Last Dinosaur

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Take the rest of the cash and invest in stocks and bonds, your return on investment will be higher % than your loan interest.
Probably not at the moment it won't - most stocks have been losing money, while interest rates are rising.


Cars are the worst way to lose money, because they depreciate so fast.
Depends on how long you keep it and how badly you ruin it with "modifications", among other things. I bought my S13 200sx second-hand about 25 years ago and similar (if slightly better condition) models are now worth nearly twice as much as I paid for it, according to local online auction websites anyway.


A full-cash payment can often get you a better deal and save you lots of money in loan/financing interest and fees, plus you gain the interest while saving up in the first place.
 

Raven1

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Half in cash and finance the other half. Can usually get really low or zero interest rate and just pay it off in 2 years to boost credit score.
Exactly, Put down just around half, Finance for the Longest Term Possible (Makes the Extended Warranty & Maintenance Plans Cheaper/Cheapest) Calculate the Payments Remaining, Final Financed Sum to 30 Months or 2.5yrs and Drive a Sweet Ride for a couple of years while still in Warranty . . .
 

Donalex

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Exactly, Put down just around half, Finance for the Longest Term Possible (Makes the Extended Warranty & Maintenance Plans Cheaper/Cheapest) Calculate the Payments Remaining, Final Financed Sum to 30 Months or 2.5yrs and Drive a Sweet Ride for a couple of years while still in Warranty . . .
The longer the term, the higher the rate. Best to contract at shortest term possible.

Don't get extended warranties as they mean nothing until AFTER manufacturer warranty. Get a warranty right before the stock warranty expires. There are aftermarket warranties available.

Service warranties are a scam. You're paying interest and you're tied to getting service at the dealership.
 

Raven1

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The longer the term, the higher the rate. Best to contract at shortest term possible.

Don't get extended warranties as they mean nothing until AFTER manufacturer warranty. Get a warranty right before the stock warranty expires. There are aftermarket warranties available.

Service warranties are a scam. You're paying interest and you're tied to getting service at the dealership.
My Debt to Income ratio is on the positive side, after taking on the expense of the new car payment (which will be around $370ish but I'll double it to $800) I'll still be spending less than half total the monthly income. I prefer to use PenFed and with them my APR is typically 0 to 2% (although with the current market it's just at 3%) on a 72 month term (either way it'll be paid off in 30mos) and it really helps that I maintain my CS steady at 824 or higher.

I agree about the service warranty, just that I'm at the point in my life where my time is worth more to me and I don't mind dropping it off for service, getting nice new loaner and go about the day.

Thank You for the tip on the service warranty, I will research that and find a best fit solution as I will be modding the car pretty much right away, LoL . . .
 

bybepl

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I would never pay cash. Financing a car works better if you have good credit. Take a little bit of that cash and put a down payment on it. Take the rest of the cash and invest in stocks and bonds, your return on investment will be higher % than your loan interest. By the time you pay your car off, you will make that interest back with the investments and now you will have some liquid cash for savings. Cars are the worst way to lose money, because they depreciate so fast. If you are not into finance/investment, then nvm lol.
I'm just against debt, the free feeling of not owing money to anyone for anything. That piece of mind is worth more than the time value of money.
 

West Aussie

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I'm just against debt, the free feeling of not owing money to anyone for anything. That piece of mind is worth more than the time value of money.
Agree but at my age 50k is not much…most are still in debt by hundreds of thousands.
We own everything outright, this will be the only thing we owe money on….but again we do have money in stocks etc if we did have to pay ot off quickly
 

julien20vt

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Just a tip for people who advice other to pay the car with a debt and use their cash to make traditional investments.
In some (most ?) countries it is a bad advice :)

If you have the cash : use it to buy the car
Then : take a loan of the same amount... and use it to do some investments

By doing this, you'll be able to deduce the interest of the loan from your capital gains... so the actual cost of the loan will actually be even lower :D
 

Donalex

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Just a tip for people who advice other to pay the car with a debt and use their cash to make traditional investments.
In some (most ?) countries it is a bad advice :)

If you have the cash : use it to buy the car
Then : take a loan of the same amount... and use it to do some investments

By doing this, you'll be able to deduce the interest of the loan from your capital gains... so the actual cost of the loan will actually be even lower :D
Not in the USA.

According to the IRS, only a few categories of interest payments are tax-deductible:

Interest on home loans (including mortgages and home equity loans)
Interest on outstanding student loans
Interest on money borrowed to purchase investment property
Interest as a business expense.

All other interest is considered personal interest, which includes interest charged on credit cards, auto loans, unpaid utility bills and late payment or underpayment of federal, state and local income taxes.
 
 





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