The Motley Fool Discussion Boards

Previous Page

Personal Finances / Credit Cards and Consumer Debt


Subject:  Re: Auto Loan Date:  12/30/2013  7:33 PM
Author:  MetroChick Number:  307640 of 312189

I'm assuming a car loan would be 3-5 years, but no longer than 5. I personally wouldn't put money I wanted to use for something specific into the stock market for only 5 years. Right now the markets on a high - but a lot of people in the financial industry think a big part of that is due to the Fed greasing the economy - odds are they'll stop in 3-5 years and who knows if there will be a correction then.

And with a car, there's always a risk it could get damaged someway - and insurance might not pay you back as much as you still have a loan for - if the market's down at that time, than it's like losing twice.

Might be wrong - but I also thought that car insurance is higher when one has a loan on a vehicle compared to once it's paid off (but I might be wrong there).

Overall - if you have the cash I think it's better to pay cash than take out the loan and invest in the hopes your investment increases faster than your loan rate.
Copyright 1996-2018 trademark and the "Fool" logo is a trademark of The Motley Fool, Inc. Contact Us