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Pay Cash, Have a Loan or Lease

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RichieG

Contributor
Sep 27, 2018
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The car/cars you currently have. Did you -
1) pay cash and own outright
2) not enough cash so paid via loan/finance ( what was interest rate)
3) had cash but had loan to keep cash rich ( if so what was % car value to cash in bank and what was %
4) I lease. If so how come and what is monthly payment and purchase price

Can you also state which country your in.

Be interesting to see people’s though process in buying a car
 

ryanbleau

Silver Contributor
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Jun 22, 2014
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Scottsdale , Az
I buy used cars I can pay cash for. Solid little import Suv' s for the wife and larger Domestic SUV's for myself. Sometimes an exotic sportscar long term flip thrown in the mix. Currently wife is beating a hyundai Tucson and I drive a lifted Z71 Tahoe, heavily modded. Will be in the market for a older porsche when I get to AZ at the end of the month. Always Cash. My rule has always been if you cant pay cash you don't need it. I know it goes against the grain of some people who finance every aspect of their life.
 

MCF

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Aug 23, 2018
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Marietta, GA
I financed a car one time back in 1999 it it really took the fun out of having the car. Sold the car in less than a year.

Ever since it has been cash deals all the way. I find it is way more rewarding to have the title in hand, than letting Bank of America hold it.

That is just me, every one has their own beliefs and what works for one may not make sense to another.
 

RichieG

Contributor
Sep 27, 2018
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57
I financed a car one time back in 1999 it it really took the fun out of having the car. Sold the car in less than a year.

Ever since it has been cash deals all the way. I find it is way more rewarding to have the title in hand, than letting Bank of America hold it.

That is just me, every one has their own beliefs and what works for one may not make sense to another.

I understand that feeling. What if you have the cash to pay for the car ( and not change your lifestyle or damage your net worth ) but choose a low loan % to pay the car over 5 years. Say the car is worth $20,000. That money could be working for you whilst you are paying the loan back over a 5 year time span.

Is that smart money management or just how you view and handle money?
 

Real Deal Denver

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Jan 13, 2018
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I understand that feeling. What if you have the cash to pay for the car ( and not change your lifestyle or damage your net worth ) but choose a low loan % to pay the car over 5 years. Say the car is worth $20,000. That money could be working for you whilst you are paying the loan back over a 5 year time span.

Is that smart money management or just how you view and handle money?

I agree. Cash is the life blood of a business.

I do know several people that lease a car, and get a new one every year or so. I asked them one time why they piss away their money on something they'll never own. Their answer was shocking, and a true life lesson.

First of all, they have an excellent accountant, and their own business. Their accountant said they are going to pay the money in taxes and have nothing for it, or they're going to burn it on a lease and drive a new car all the time.

It's great to have friends that clue me into things like that!
 

minivanman

Platinum Contributor
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Mar 16, 2017
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We pay cash. Although the little woman drives a new SUV, I buy used. Just bought a 2008 Dodge Grand Caravan 109,000 miles in LIKE NEW condition $5,675 cash. Was driven by the dealer as a courtesy vehicle so the maintenance has been excellent.

Neighbor was just telling me yesterday what a great deal her Mercedes was to lease. I listened with no comment. The worst thing is.... she has a nice Volvo SUV sitting in the driveway that is paid for.
 

ZCP

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+1 for company vehicle. It is pretax. When comparing bottom lines, it costs less than i was paying in yearly maintenance on an older car. It also helps sell the company when i go onsite.

why not move all your expenses inside the company?
 

Jeff Noel

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Oct 26, 2018
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I financed my first motorcycle. Sold it a year later for 66% the price, after 3 tickets in 2 days and potentially losing my licence (ended up keeping it). Paid it in full in 2 years instead of 7. Did the same thing for my 2nd bike, but the $18K price means I still have $10K to pay for it. I traded the bike and renegociated the financing options (from 7 years remaining at 6.9% to 5 years at 0.9% for the same amount and a brand new bike, 0$ cash OOTD). I still owe my parents $4500 for that 2nd bike... they said it was a gift, but I won't forget that amount and I will repay them (tenfold eventually).

Got my first car from my parents for $1000. Paid cash.
Got my second car from my uncle, my parents lended me $4000, which I paid back. The car had 80K Km (50K miles) on it, now it's at 145K km (90K miles), it's a 2005 Ford Focus SX4 SE. Gets me moving... I still need to replace the whole exhaust system (cut a part of it 2 weeks ago) and I had to replace both front axles last week when one of them broke while going to work ($1150 job). Sigh

The $10K I still owe would've been paid in full this year (it was my plan), but the girlfriend's business is not going too well this year, so I took care of daily/weekly/monthly expenses and started spending more conservatively.

She was also diagnosed with type 1 diabetes in december 2017, so it changed my budget a little bit.

That's not an excuse though, I'm executing a new plan to clear that financed amount before July 2019. Sales will come soon. I begun creating a MVP.

The next time I finance a vehicle, I'll have more than its value in cash flow and I'll be able to pay it in full whenever I want. I won't get stuck with a deadly debt balloon anymore.
 
Last edited:

Andy Black

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Three years ago I paid €3k cash for a 2006 Toyota Corolla. It’s for school runs and grocery shopping. I don’t meet clients in it as I work from home. I think it’s worth €2k now. Sure, I’ve spent a bit fixing a persistent squeaky wheel, but it’s clean, well maintained and I love that it’s bought and paid for. It represents me being smarter than when I was younger.
 

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