Quick buying question poll

[micha3l]

Commercial Hire Purchase for me.

Was able to get 4.99% with CBA's Asset Finance division, and with my log book showing 85% work use (use the wife's work car on the weekends), a way better deal using finance after tax deductions.

Extra funds are better used paying off mortgage/investment purposes!

[sparoz]

Originally Posted by tyrrellnick

Works if you're a Sultan or Sheik.

Sorry to be blunt but if you can't pay for it outright, you shouldn't buy the car period.

[Knightelf]

This question has too many variables.

If you can't afford it upfront, then get a loan/CHP or whatever arrangement with the best terms you can find.

If you have the cash, consider whether there are better things you can do with that cash (e.g. if investment return > loan interest then obviously go for loan). If not then pay upfront.

[PeteA]

Finance. There's no way I can live with myself forking out 100k in one bang. That sting would be just too immense from seeing my account balance drop like that. I wouldn't buy any volatile item like a car without being certain I could pay for it all up-front of course, but i'd rather pay for it over 4 years. Even if that means paying a bit more for it in the long run, 1 -1.2k out of my pay per month is far more manageable.

[Knightelf]

Originally Posted by sparoz

Sorry to be blunt but if you can't pay for it outright, you shouldn't buy the car period.

A person should do whatever makes him happy (within reason). I do not agree that a person should never buy a car on a loan but it depends on particular circumstances.

As the saying goes... buy the least expensive car your ego can afford.

[Jeef Beef]

Originally Posted by sparoz

Sorry to be blunt but if you can't pay for it outright, you shouldn't buy the car period.

If you can do more with the money than the interest on the loan, then there is no reason to fork out the cash upfront.

Of course, that's a huge if.

[sparoz]

Originally Posted by sparoz

Sorry to be blunt but if you can't pay for it outright, you shouldn't buy the car period.

Originally Posted by Knightelf

This question has too many variables.

If you can't afford it upfront, then get a loan/CHP or whatever arrangement with the best terms you can find.

This is my personal opinion if you want to get ahead financially. Been there and still regretting my first BMW - I was 23.

Originally Posted by Reigns

Finance. There's no way I can live with myself forking out 100k in one bang. That sting would be just too immense from seeing my account balance drop like that. I wouldn't buy any volatile item like a car without being certain I could pay for it all up-front of course, but i'd rather pay for it over 4 years. Even if that means paying a bit more for it in the long run, 1 -1.2k out of my pay per month is far more manageable.

+1.

Originally Posted by Knightelf

A person should do whatever makes him happy (within reason). I do not agree that a person should never buy a car on a loan but it depends on particular circumstances.

As the saying goes... buy the least expensive car your ego can afford.

A person can do whatever they want even it doesn't make any financial sense. Unless you have the means to pay it upfront, or have a passive income that can cover the repayment, you are just delaying your financial freedom.

Originally Posted by Jeef Beef

If you can do more with the money than the interest on the loan, then there is no reason to fork out the cash upfront.

Of course, that's a huge if.

Not a huge if . Everyone's skill set is different.

[pavo335]

Originally Posted by sparoz

Sorry to be blunt but if you can't pay for it outright, you shouldn't buy the car period.

did you pay cash for your house?

let me suggest there is good debt and bad debt. That debt on ya house is the bad kind and the car type that is tax deductable is the good kind.

[Jeef Beef]

Originally Posted by pavo335

did you pay cash for your house?

let me suggest there is good debt and bad debt. That debt on ya house is the bad kind and the car type that is tax deductable is the good kind.

Depends, if it's an investment property gearing it up is a non-issue since rent can cover most if not all interest payments.

[sparoz]

Originally Posted by pavo335

did you pay cash for your house?

let me suggest there is good debt and bad debt. That debt on ya house is the bad kind and the car type that is tax deductable is the good kind.

We are talking about cars here specifically. Your definition on good and bad debt is fine for taxation purposes, but it is not on building wealth.

What you are talking about refers to if you have both HOME loan, and car loans it is better off to pay off the non tax deductible part first.

What I am talking about is that a car loan could be a bad loan to start off with if you couldn't afford it in the first place.

If you can't pay for it outright if you haven't got passive income to cover the repayments, then it is a bad loan. Personally, if I can relive my earlier years, I would not spend money on any over the top items unless my passive income can sustain it.

[PeteA]

This is true, but an investment loan for a house is what I call a super-duper good debt I'll go out on a leaf and say that any debt on a home (even a normal home loan) is a good type of debt because it's an asset that appreciates over time.

Debts on a cars are only EVER good when they are bought for business purposes

[Jeef Beef]

Originally Posted by sparoz

Not a huge if . Everyone's skill set is different.

Very true, certainly depends on how confident you are with that sum of money.

Just remembering that paying it all upfront immediately locks up that sum of cash in a depreciating asset.

Originally Posted by Reigns

This is true, but an investment loan for a house is what I call a super-duper good debt I'll go out on a leaf and say that any debt on a home (even a normal home loan) is a good type of debt because it's an asset that appreciates over time.

Debts on a cars are only EVER good when they are bought for business purposes

+1, getting tax deductions on repayments for business purposes is a big incentive for hire purchase.

[sparoz]

Originally Posted by Reigns

This is true, but an investment loan for a house is what I call a super-duper good debt I'll go out on a leaf and say that any debt on a home (even a normal home loan) is a good type of debt because it's an asset that appreciates over time.

Debts on a cars are only EVER good when they are bought for business purposes

I have changed my mind about home loan (not investment loan for a house). Any loan bigger than you need for cash storage is always going to be luxury unless you know what you are doing with the property market.

A car loan with business purpose is only good if what you spend on it justifies the business purpose.

[PeteA]

True true. I guess circumstances play a huge factor in what's beneficial or not for the individual.

[gazz]

Cash.

[Knightelf]

Originally Posted by Reigns

Debts on a cars are only EVER good when they are bought for business purposes

Car loans are always good, just don't get out of the driver's seat or look at your bank statements

[Meijo]

Originally Posted by gazz

Cash.

Cash is King !!!!

[Alpine*]

Originally Posted by gazz

Cash.

Cash = net monies = for me, no thanks

[Jeef Beef]

Originally Posted by gazz

Cash.

Drug dealing?

[sparoz]

Originally Posted by Jeef Beef

Drug dealing?

That's me.

[gazz]

Originally Posted by Jeef Beef

Drug dealing?

Nope. Had a very very fortunate run before the GFC. I would like to say it was completely by design but there was a bit of of luck as well. Mind you I worked very hard for a lot of years and took a few calculated gambles to make that luck.

Originally Posted by sparoz

That's me.

Hehe.

[oystero]

Originally Posted by sparoz

That's me.

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