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04-20-2020, 09:12 AM
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#41
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Administrator
Join Date: Apr 2006
Posts: 22,973
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Quote:
Originally Posted by SmallCityDave
They are in good shape, they'd be in better shape if they didn't borrow that money and bought less expensive vehicles but they borrowed that money because they felt they needed to.
I'm not condemning them but I don't think that's the right thing to do and he asked our opinion.
Furthermore I'd sell the home and move to Arizona asap
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Way earlier in this thread, I mentioned that I bought a new vehicle (Subaru Forester) in December 2017. I could easily have paid cash, but they were offering 0% financing for 63 months, so I took it and kept my cash. I am still paying on that loan, but I easily have the cash flow to do it and have absolutely no financial incentive to pay it off. In June 2019, I bought another vehicle (Mini Cooper). They were only offering 3.5% financing, so I paid cash. As a general rule, if you can earn more on your money (risk adjusted) than the cost of financing, then why not finance? For me, 0% was an easy yes and 3.5% an easy no. I don't recall where I thought the break point was last summer.
The lesson is that if you have control over your spending and plenty of cash in hand, you may decide that it is better to finance than pay the cash. It's just calculating the present value of money under two different conditions. There is nothing in the OP's original or subsequent posts to suggest that he could not pay cash for his vehicles. He may have made the same calculation I did.
__________________
Living an analog life in the Digital Age.
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04-20-2020, 09:13 AM
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#42
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Recycles dryer sheets
Join Date: Jun 2018
Location: Spring
Posts: 306
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Welcome to the forums... It sounds to me like you are good to go, so you have indeed won the race!
That said, many in here are very debt averse and believe in maintaining quite a lot of liquidity (myself included) in their kitty. My parents experienced the great depression, and it had a pretty big influence my financial life. While never a super high earner, I am a heck of a saver and can stretch a dime quite far.
I'm finding a weird dichotomy of increased snarkiness and increased kindness all around the web these days (and not just since C19). Just look at the comments sections on any news sites that allow them. There is a lot of tension & anxiety around the world.
Good luck with whatever you decide to do!
__________________
In the business of isness >^..^<
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04-20-2020, 10:15 AM
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#43
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Dryer sheet aficionado
Join Date: Apr 2020
Posts: 32
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Quote:
Originally Posted by SmallCityDave
It's in his original post, he couldn't afford his truck or his daughters car so he borrowed the money. It's not that complicated.
I'd like to find a cd that's paying 2.5%
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No I said "Our house is paid for and the only bills we have are living, taxes, utilities and a couple car payments of around $900 a month. Plan on paying off one of the cars (daughters 2019 crosstrek) in June and will only have my truck payment of $600"
They are financed through a credit union - never said I couldn't afford them
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04-20-2020, 10:25 AM
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#44
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Feb 2007
Posts: 9,953
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Quote:
Originally Posted by srpuywa
No I said "Our house is paid for and the only bills we have are living, taxes, utilities and a couple car payments of around $900 a month. Plan on paying off one of the cars (daughters 2019 crosstrek) in June and will only have my truck payment of $600"
They are financed through a credit union - never said I couldn't afford them
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That's OK most of us get the drift...
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04-20-2020, 01:48 PM
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#45
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gone traveling
Join Date: Oct 2018
Posts: 309
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Quote:
Originally Posted by pb4uski
Since when are a Subaru Crosstrek and a Toyota Tundra expensive vehicles? Especially if you can borrow at 2.5%. Given the OP's income and savings these vehicles don't seem outrageous.
Are you sure that you aren't Dave Ramsey?
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Expensive is a matter of perspective, when I was 25 and had a net worth of 0 I didn't think that the $20k price of my truck was expensive.
Thanks for the compliment
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04-20-2020, 02:01 PM
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#46
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gone traveling
Join Date: Oct 2018
Posts: 309
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Quote:
Originally Posted by srpuywa
No I said "Our house is paid for and the only bills we have are living, taxes, utilities and a couple car payments of around $900 a month. Plan on paying off one of the cars (daughters 2019 crosstrek) in June and will only have my truck payment of $600"
They are financed through a credit union - never said I couldn't afford them
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Yeah I understand what you said but if you don't have the cash ready to buy the car outright in it's simplest form you can't afford it.
I work with people everyday that can't afford a home so they get loans, they may earn a lot of money but the cash isn't there.... If I have a 100k in the bank and I want to buy a $50k Tundra but with whats going on in the world I feel a lot better having the cash in the bank and I get a loan the end result is the same I can't afford it.
I understand we may all not agree and some may think my opinion is "controversial" and that's okay, I don't think you are a bad guy but I think it's a poor decision.
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04-20-2020, 02:07 PM
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#47
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Moderator
Join Date: Feb 2010
Location: Flyover country
Posts: 25,199
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Quote:
Originally Posted by SmallCityDave
but I think it's a poor decision.
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And you've made your point enough times that I think we've all got it now.
__________________
I thought growing old would take longer.
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04-20-2020, 02:10 PM
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#48
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Feb 2007
Posts: 9,953
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Quote:
Originally Posted by braumeister
And you've made your point enough times that I think we've all got it now.
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Yes even after 7 posts some of us don't agree with his comments. I don't think post number 8 will be the tipping point..
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04-20-2020, 02:11 PM
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#49
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gone traveling
Join Date: Oct 2018
Posts: 309
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Quote:
Originally Posted by braumeister
And you've made your point enough times that I think we've all got it now.
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I wasn't trying to make a point I was simply addressing people the people that directly quoted me.
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04-20-2020, 02:13 PM
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#50
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Feb 2007
Posts: 9,953
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04-20-2020, 03:23 PM
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#51
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Full time employment: Posting here.
Join Date: Aug 2019
Posts: 691
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__________________
--At what age does spending less now in order to have more later stop making sense?
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04-20-2020, 03:30 PM
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#52
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gone traveling
Join Date: Oct 2018
Posts: 309
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Quote:
I'm happy to help when I can
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04-20-2020, 08:14 PM
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#53
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Dryer sheet aficionado
Join Date: Apr 2020
Posts: 32
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Quote:
Originally Posted by SmallCityDave
Yeah I understand what you said but if you don't have the cash ready to buy the car outright in it's simplest form you can't afford it.
I work with people everyday that can't afford a home so they get loans, they may earn a lot of money but the cash isn't there.... If I have a 100k in the bank and I want to buy a $50k Tundra but with whats going on in the world I feel a lot better having the cash in the bank and I get a loan the end result is the same I can't afford it.
I understand we may all not agree and some may think my opinion is "controversial" and that's okay, I don't think you are a bad guy but I think it's a poor decision.
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Well that certainly is your opinion, some people like to sit around and make judgement on others with some unknown superiority complex. I didn't buy these vehicles knowing I was getting laid off. My wife and I have the cash to pay off both of the loans but financing keeps the cash in reserve. If need be I can put the truck up for sale but it's our future retirement road trip vehicle so for now I'll hang on to it. Being able to 'afford' something does not always mean paying cash.
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04-20-2020, 08:29 PM
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#54
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Full time employment: Posting here.
Join Date: Aug 2019
Posts: 691
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I wonder if smallcitydave never got a loan for anything because he couldn’t afford it... That would be pretty rare in America.
__________________
--At what age does spending less now in order to have more later stop making sense?
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04-20-2020, 08:55 PM
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#55
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Thinks s/he gets paid by the post
Join Date: Dec 2017
Posts: 2,534
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If you are retired, have positive cash flow, and investments, I can see taking out a loan to buy a car. You can afford the interest payments, and by paying interest now, you're keeping your other investments in place. Of course, I'd rather pay cash, but what if I didn't need to, because my income exceeded my expenses, and there wasn't anything I wanted to spend the extra cash on? Let's go Ferarri shopping!
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Balance in everything.
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04-20-2020, 08:59 PM
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#56
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gone traveling
Join Date: Oct 2018
Posts: 309
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Quote:
Originally Posted by srpuywa
Well that certainly is your opinion, some people like to sit around and make judgement on others with some unknown superiority complex. I didn't buy these vehicles knowing I was getting laid off. My wife and I have the cash to pay off both of the loans but financing keeps the cash in reserve. If need be I can put the truck up for sale but it's our future retirement road trip vehicle so for now I'll hang on to it. Being able to 'afford' something does not always mean paying cash.
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Well I'm sorry if I hurt you feelings, I don't have a superiority complex I was just trying to give you some input contrary to most here.
You seem to both attack me and defend the (right?) decision you've made.
You can keep your truck or if you really like where you are buy a newer, better & more expensive truck especially if you have the credit. All too many people think that they can and should borrow as much as the bank will lend me (yeah I know that's not you).
My advise isn't for everyone but places like this should be a good place to share different ideas.
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04-20-2020, 09:05 PM
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#57
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gone traveling
Join Date: Oct 2018
Posts: 309
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Quote:
Originally Posted by SnowballCamper
I wonder if smallcitydave never got a loan for anything because he couldn’t afford it... That would be pretty rare in America.
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I did and I learned from my mistakes, many here would have told that I'm doing just fine.
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04-20-2020, 09:31 PM
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#58
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Nov 2010
Location: Sarasota, FL & Vermont
Posts: 36,266
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Quote:
Originally Posted by srpuywa
....and bank accounts have around $130K ...
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Quote:
Originally Posted by SmallCityDave
Yeah I understand what you said but if you don't have the cash ready to buy the car outright in it's simplest form you can't afford it. ...
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Dave, are you flipping daft? The OP has $130k in bank accounts... so he can afford to buy the cars outright but for whatever reasons choses not to.
Do you have anything else that is useful to contribute or are you a one-trick pony?
__________________
If something cannot endure laughter.... it cannot endure.
Patience is the art of concealing your impatience.
Slow and steady wins the race.
Retired Jan 2012 at age 56
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04-20-2020, 09:35 PM
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#59
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Mar 2007
Posts: 14,328
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Quote:
Originally Posted by srpuywa
......... some people like to sit around and make judgement on others .....
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Judgment only has one "e".
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04-20-2020, 09:38 PM
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#60
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Nov 2010
Location: Sarasota, FL & Vermont
Posts: 36,266
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Not everywhere though.
Quote:
Is Judgement a misspelling?
Judgement is the accepted spelling in British English. Webster first recorded the misspelling of judgment in his 1828 American Dictionary of our English Language, and Americans have been misspelling most of our true English words since then. ... In American legalese, “judgment” even more sharply predominates.
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__________________
If something cannot endure laughter.... it cannot endure.
Patience is the art of concealing your impatience.
Slow and steady wins the race.
Retired Jan 2012 at age 56
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