leoj

What's your thoughts on it? Do you buy used cars cash? New cars financed? New cars cash? Currently I finance only the new cars I would buy like my Genesis. Can't help but feel it's a huge waste of money even though I have a really low interest rate (3%). Listening to Dave Ramsey he absolutely hates financing vehicles. I don't really see myself having more than 12k to buy a cash car when the time comes. I'm not sure I trust a 12k car to be 100% reliable. What is your opinions and experiences?

JonGTR

By his plan, if you have 12k, then you should go buy an Accent or Corolla. They'll be reliable enough.



All new vehicles are a waste of money. They will all depreciate and never be considered an investment. You can only consider collector cars as investments these days.





I'm not a Ramsey fan at all.

i8acobra

I have Champagne taste and a beer budget, so I finance. I just never pay over 5% and never go longer than 60 months. I also never finance negative equity on my trade in or taxes. Those get paid cash.

Stocker

If you are doing something with your money that gets a better rate than the financing will cost you, then do that and make the extra money over time. Most people will do better overall if they just pay cash (because most people aren't investing). But most people also can't plunk down a pile of cash for a car when they need a new one so they'll finance it.



Do what you gotta do.

187sks

I have bought my last 8 vehicles with cash. I do not intend on financing another car ever. I carry liability insurance only as well. Full coverage is a lot of extra money, especially on relatively low value cars. It's usually a bigger hit than the cost of the financing itself.

JonGTR

That's not always an option where you live. Down along the border states, insurance rates are ridiculous and you don't want to get caught off guard without full coverage when an illegal/uninsured totals your vehicle. I've been in that situation twice now. Both times in vehicles I love. That's why I now drive a stock Avalon to work with full coverage.

187sks

I don't regularly drive anything worth more than a year's worth of full coverage insurance premiums anyways. Most of the value in the vehicles that I love wouldn't be covered by full coverage insurance anyways unless I had a declared value policy.

i8acobra

I usually have one or two vehicles like that, but I also like new cars. I have a 2014 F150 I bought new. That's financed and has full coverage.

JonGTR

It's hard to love a vehicle valued over $2k, or find one that can get you to work reliably.

187sks

I'm guessing you mean under $2k? Full coverage always cost me more than $2k/year. Either way I have to disagree, I love my little Accent and I'm pretty sure its market value is below $2k. Everybody loves my van and it's value is around $2k (I bought it for $900 and put in some work).



I haven't been driving anything I either bought for over $2500 or valued over $2500 in many years. Reliability isn't too bad depending on what you buy. I always have at least two seemingly reliable vehicles in case one has a problem. I have never had difficulty making it to work reliably.



Wanting newer cars and being willing to pay extra for that luxury is fine, just not for me personally.