Toyota Rav4, $29k, paid cash.

Anonymous wrote:I typically pay cash and am generally against car loans. However, I would absolutely take 0% for 60 months over paying cash.

+1. I think that if you are otherwise pretty liquid, the arguments against taking the 0% financing make little sense. I haven’t bought a new car in forever but will be doing so in the next few years. I’ll probably pay cash unless there’s a 0% financing offer (and assuming the cost of the car is not higher than it otherwise would be to make buying in cash still the better choice). My money market yield right now is 1.5%. And interest rates are rising. I would certainly rather just take the 0% financing and pay the monthly installments out of my MMA where the cash is accruing interest. In a year or so, we may see rates at around 3% or higher. There’s a lot of talk about inflation right now which means locking down a 0% loan is definitely the smarter move. Again tho, if you live closer to the knife’s edge, do what makes you more comfortable.

$0. My car has been paid off for 2 years.

Anonymous wrote:OP and the PP with two kids in daycare were different posters. But, yes, I agree with PP that most of the people responding are out of touch rich people. It is very typical for people not to have enough cash saved up to buy a car (unfortunate, but typical).

We're facing a similar question of whether to buy a new car at 0% versus used car at 2.29% or whatever the credit union is charging these days. Do I wish we had cash on hand to buy a car without a loan? Of course. But we don't, and our minivan is on its last legs and not worth repairing, and I need something safe and reliable (not luxurious, not fancy) to drive my family around in.

And getting a 0% loan and keeping the cash in savings is not the same thing as investing on margin. C'mon people...

Figure the cost of a new car with 0% and a used car at 2.29% and decide whichever is best for you.

If you choose the new car, when you decide how much to put down and how much to finance, it is exactly the same as getting a 0% loan and keeping the cash to "invest" (you choose the asset allocation) on the margin. This has nothing to do with being rich or poor.

Similarly, choosing the size of the down payment on the 2.29% loan is the same as getting a 2.29% loan and keeping cash to "invest" on the margin on the amounts you choose to finance.

car payment - 220/month used Toyota Rav4

OP and the PP with two kids in daycare were different posters. But, yes, I agree with PP that most of the people responding are out of touch rich people. It is very typical for people not to have enough cash saved up to buy a car (unfortunate, but typical).

We're facing a similar question of whether to buy a new car at 0% versus used car at 2.29% or whatever the credit union is charging these days. Do I wish we had cash on hand to buy a car without a loan? Of course. But we don't, and our minivan is on its last legs and not worth repairing, and I need something safe and reliable (not luxurious, not fancy) to drive my family around in.

And getting a 0% loan and keeping the cash in savings is not the same thing as investing on margin. C'mon people...

People telling you to put more money down are morons. 0% financing is the way to go, always - you're playing with the house's money.

2011 $10k cash for 5 year old car
2000 $20k cash for 2 year old car
1992 $1.5k cash for 10 year old car

Am starting to look for another car now. I don't drive much, so a car was never a must-have.

I have read that the 0% financing gimmicks came with a higher price tag for the car, so in the end the house always wins.