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Author: tmorella Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 308722  
Subject: Auto Loan Date: 12/30/2013 4:59 PM
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So, after 16 years, I have come to the realization that my current car may not make it through the next winter, and that I should buy a car sooner rather than later.

Anyhow, I have budgeted the amount that I am willing to spend on a used car. However, although the thought of having to pay an auto loan abhors me, I was curious ...

With the following assumptions:

1. I find a loan with a fixed rate below the traditional rate of inflation (i.e., 3% or less); and
2. I can reasonably be sure of investing the money that would be used to buy the vehicle at a return greater than at least the traditional rate of inflation (and hopefully greater than the inflation rate plus the interest rate).

I would think it would be worth it to take a loan, as opposed to buying the vehicle outright.

Am I missing something here?
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