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|Subject: Re: Paying for Cars with Cash||Date: 8/2/2007 10:50 AM|
|Author: readyteddy||Number: 9070 of 59078|
I haven't made a car payment since maybe 1980.
I did do a lease deal back in 1996. Decided to get my wife a Miata for her 50th birthday (it was the red sports car or a younger lover; we both decided the car made more sense). There was a zero interest lease available and we weren't sure how much we would use the car and so we thought we would "try before we buy" with a two year lease.
Turned out we loved the car so I bought it for cash coming off the lease - I know, I know, two sales taxes and all that but the total cost was still pretty close to what I would have paid if I had bought in the first place. Basically, I bought the first two year's depreciation for zero percent interest, then bought the residual value for cash, so the second sales tax doesn't mean a whole lot since we plan to keep the car forever anyway, but I digress.
When I bought the car off the lease, the guy at the dealership didn't know how to write up a cash deal. Pretty funny.
My every day driver is a 2000 Accord that I paid cash for too. My wife and I also each threw ten thousand into a segregated account a few years ago which will fund our next car when we need one. We keep this money separate from our other investments and don't do anything fancy with it. The "car fund" now has $25,405 in it and is in a 7 month CD at 5.05%.
I don't know about you guys, but I would rather have people pay me interest than have to pay interest to other people, especially on a depreciating asset. Paying interest on a car is sort of like paying interest on food. Well, duh....
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