How much are you paying for your car?

[Anonymous]

I’m buying a $25k. brand new car. I’m getting a 0% financing deal for 60 month.
My monthly payment will be around $400.
I can afford i but I wonder whether this is too much. I have seen posts here car payments of $400 were criticized as excessive.
I don’t see how I can pay less than that if I want to drive a decent midsize car. This is not even a luxury model.

How much are you paying for your car?
If your car is paid off, how much did you pay for it?

[Anonymous]

Bought a new Mazda 5 for 18k. Paid cash.

Car lease payments are for the poor, or for flashy new-money types.

[Anonymous]

Serious and not snarky question - why do you not have more money saved to put against the car, either outright or a downpayment? You are essentially financing the entire car.

If your finances are that tight and you don’t have the ability to save more, then you probably should be looking at a used car. $25k is the price of a modest new car, but it still sounds like more than you can afford. It’s one thing to take them up on 0% financing for about half that amount, but not the whole thing.

[Anonymous]

Who cares what anyone here thinks. If you can afford it and you like the car, what DCUM says doesn’t matter at all. Everyone here will tell you that cars should be paid in cash, which is far from reality. At 0% it makes no difference

[Anonymous]

This really depends on your personal finance situation. No one-size-fits-all answer.

[Anonymous]

What is your HHI? Other monthly payments and total debt?

[Anonymous]

3 cars one was a $419 payment for 6 years sucked but it has been paid off for 7 years and still runs so not too bad. Another had a $270 payment for 6 years and has been paid off for 1 . Last one is a lease but we put $0 upfront its $480 per month for an SUV which seemed reasonable to me for a 3 year lease that we may purchase at the end

[Anonymous]

I've always just saved up until we could buy a new car out right. My parents bought my first car at 16 and I drove it for 8 years.

$400 doesn't seem excessive, especially at 0% interest.

[Anonymous]

36k saved up the cash. Previous car was 14 years old. 2nd car 32k also saved the cash about 5 years ago. We drive our cars to the ground.

[Anonymous]

Seems a little too expensive for you. Do you have a year of payments saved up? I'm sure you can do it, but some wonder why haven't you done it already.
I bought a $15k used car and it's still going strong after 10 years. I will get the $25k car after that, but it's a splurge. It better run 15 years since it will be new.

[Anonymous]

The last two new cars we have purchased have been in that price range and are great cars (Prius and Rav 4). The Prius is 10 years old and still going strong and the Rav-4 is 2 years old. You can get excellent cars that will last a very long time in that price range. If you can afford the $400 payment, all is good.

[Anonymous]

I always pay cash for cars and I really like buying three year old cars coming off lease. They generally have pretty low mileage and if certified pre-owned by a reputable dealer you can get a very good deal.

[Anonymous]

Anonymous wrote:Serious and not snarky question - why do you not have more money saved to put against the car, either outright or a downpayment? You are essentially financing the entire car.

If your finances are that tight and you don’t have the ability to save more, then you probably should be looking at a used car. $25k is the price of a modest new car, but it still sounds like more than you can afford. It’s one thing to take them up on 0% financing for about half that amount, but not the whole thing.

To the contrary, much better to finance the entire thing at 0% than to sink cash that could earn a return elsewhere in a depreciating asset. If I had 10 grand for a down payment and the dealer was offering 0% financing, l will take it and invest the 10k (assuming I get a good price on the car).

[Anonymous]

Anonymous wrote:Serious and not snarky question - why do you not have more money saved to put against the car, either outright or a downpayment? You are essentially financing the entire car.

If your finances are that tight and you don’t have the ability to save more, then you probably should be looking at a used car. $25k is the price of a modest new car, but it still sounds like more than you can afford. It’s one thing to take them up on 0% financing for about half that amount, but not the whole thing.

Because at 0% financing, it doesn't make sense for me to put money down when I can invest it for 5-8% return in the market.
A used car often means additional maintenance costs.

[Anonymous]

I applaud you for taking advantage of 0% financing. Even if you had enough to pay for the vehicle in cash, take advantage of someone else's money while you can. If you can afford $400 a month, then it's not too much.