Is it ever a good idea to pay full price for a car up front?

[Anonymous]

“Financing” the car to get an additional discount and then immediately paying off the loan, as many of us have done, does not count as taking a car loan the way most people see it. So obviously in that case it’s just a means to an additional discount, like using a coupon.

I’ve never liked the option of leasing as public policy. It leads to overspending/overextending and also the makes people appear wealthier than they are, exacerbating the conspicuous consumption problem we have. Because it’s “cheaper” (per month) than buying, people get a more expensive car than they could afford to finance. But the problem is that they are now locked into this payment forever, because at the end of the lease they are forced to lease a new car, whereas at the end of the loan you own the car and can keep driving it for a long time.

Some very high income people will come on here claiming leasing is cheaper if you want a new car often. This still isn’t true but it matters less because they are wasting money they can afford to waste.

[Anonymous]

Anonymous wrote:The car is cheaper, generally, if you finance it. Pay off the loan with cash the next month.

I just went with my mom to buy a certified used car over the weekend. They gave $2k off if you financed. We confirmed the rules. She needs to make 4 monthly payments and can then pay in full. She was planning to pay cash but this hassle is worth the discount.

[Anonymous]

We pay cash but if it meant we got a discount I’d take financing and pay it off quickly.

Generally though the amount at stake isn’t enough to try to try to beat interest rates. When interest rates are low on car loans they are low in safe investments too.

[Anonymous]

Bought a $28K car in 2017 with 3-year financing and paid it off; car was the best beak of my life. 5 years and 60K later I could sell it for $18K if I wanted to but I love it too much to sell.

[Anonymous]

^best deal

[Anonymous]

Anonymous wrote:Some people lease because it’s easy, not because it’s the best deal.

This. Also, if you'd like to always drive new cars. I have a friend who loves cars and he leases, and every two or three years he has a different model or brand of car. He loves the variety. He's also quite wealthy. He could've bought any one of the cars that he leased.

[Anonymous]

Good credit, 0-3% rate, take a loan and invest.

Maybe I only bought cars during recessions?

[Anonymous]

Anonymous wrote:“Financing” the car to get an additional discount and then immediately paying off the loan, as many of us have done, does not count as taking a car loan the way most people see it. So obviously in that case it’s just a means to an additional discount, like using a coupon.

I’ve never liked the option of leasing as public policy. It leads to overspending/overextending and also the makes people appear wealthier than they are, exacerbating the conspicuous consumption problem we have. Because it’s “cheaper” (per month) than buying, people get a more expensive car than they could afford to finance. But the problem is that they are now locked into this payment forever, because at the end of the lease they are forced to lease a new car, whereas at the end of the loan you own the car and can keep driving it for a long time.

Some very high income people will come on here claiming leasing is cheaper if you want a new car often. This still isn’t true but it matters less because they are wasting money they can afford to waste.

How is leasing more expensive than selling your 2-4 year old car?

[Anonymous]

Anonymous wrote:I would never bother with the hassle of a car loan. Just pay cash.

+1 I have already paid cash and don't see the downside if you can afford it

[Anonymous]

Yes. Always.

I don’t commit my future income to depreciating assets of any kind.

[Anonymous]

All Asians that I know, myself included, pay cash on vehicles purchase. I paid cash for my 2023 Tesla model X and Model Y for DW. I also paid cash for my DS 2024 Lexus IS350.

[Anonymous]

Anonymous wrote:All Asians that I know, myself included, pay cash on vehicles purchase. I paid cash for my 2023 Tesla model X and Model Y for DW. I also paid cash for my DS 2024 Lexus IS350.

You only bought your DS a brand new Lexus IS350, how DO you live with yourself?

[Anonymous]

never pay full price for a car, those who fall for the no haggle pricing, the media saying there are no cars to buy, etc. simply not true, the dealers will tell you they have no cars but they do.

The average car sits on a lot is 71 days

[Anonymous]

Anonymous wrote:

Anonymous wrote:Of course. The rich don’t get car loans.

Correct, but we also buy certified pre-owned (aka used cars).

100% - buy pre-owned, pay cash, and drive into the ground. It's a depreciating asset.

[Anonymous]

Anonymous wrote:Wealthy can do whatever they want but for smart UMC, you buy what you can afford.

+1

I was always taught, you should only buy a car that you can afford to pay off in 3-4 years (for your first cars). Then you drive the car for 7-8+ years and continue to save the car payment (and any decrease in auto insurance as the car ages). That way when you have an 8yo+ car, you trade it in/sell it and that with your savings will get you close to paying cash for the next car. By your 3rd car you should easily be able to pay 100% cash.