Quote:
Originally Posted by jacobsed
The problem with option 2 is that you now have debt. I'm sorry but millionaires didn't become rich by playing spreads on car loans and going $45k - $50K into debt for one. Unless you already have all your other debts paid (house included), have an emergency fund and already have a solid retirement plan you really have no business financing a car this expensive.
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Whatever mate, you run your finances your way, I will run mine my way. Why would I take $35K out of the market where it is earning me 5% (and have to pay 15% capital gains tax on some portion of it) to save
.9% interest? I certainly COULD have paid cash for it, but having more than a couple thousand laying around in a non-earning account would be foolish. Even my emergency fund money is making more than .9%. Millionaires also did not get that way by being foolish with their money.
Your argument makes perfect sense if interest rates were at the historical norms of 7-9%. Particularly if one was planning to be in an endless cycle of trading one car for another. I have no intention of doing that, this car will be paid off in a couple years, and I plan to keep it for the foreseeable future. After all, BMW seems disinclined to sell me another one - I don't do automatics. I may keep this car so long it starts to appreciate - I have owned one of my cars for 19 years now.