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... You either budget something for life or you have to periodically come up with wads of cash.
Yeah, you're right. I do the latter while some people do the former. I currently drive a 2005 Durango with 117K miles that gets about 14 mpg around town (lots of hills). I see people with newer expensive SUVs (Land Rovers, Audis, Porsches, Cadillacs, Lexii, Acuras, Infinitis) and while I would certainly like one (especially some newer features such as bluetooth, USB, backup cameras, front parking sensor), I just can't seem to pull the trigger on the wad of cash for a new vehicle. My Durango mechanically sound, and I don't feel bad carrying all manner of stuff in the back - even things that will scratch it up. Its value is relatively small (probably 8K at most) so I wouldn't trade it in - I'd just keep it for hauling stuff -- but then again, if I keep it for hauling stuff, why bother with the new high end SUV? That's my dilemma.
What is the current interest rate for someone who is financing a car? Just curious.
If a car payment gets in the way of saving, it's being done wrong.
After saving 30% of my take home monthly pay and paying the bills, I still have some left over. I'd rather use some of that discretionary income for a lease payment than fixing a clunker.
Agreed, but think about how much MORE you'd save without the payment. I agree with many that interest rates are so incredibly low that it makes financial sense to go ahead and take the financing, but only if you have fantastic credit (which I do).
So it's a wash. I have a lot of cash sitting around waiting to be my home down payment anyway, so I'm not investing that (and yes, have those too), and it's dumb to put too many eggs into one basket. And I am comfortable with some $ sitting on the sidelines, waiting for that right home.
The fact of the matter remains that a huge portion of Americans are just flat out broke and many will never actually own their car even when it makes financial sense for them to do so. If you can afford leasing and don't want to deal with hassles and repairs then by all means do that. I guess if you're going to constantly be making payments anyway it's not that much different than financing and doing the trade in. As for me, my car has paid for itself long ago sans monthly payments, and I haven't had to worry about that hassle either. I'll ride it until it's no longer worth the frequency/cost of repairs. Until then, and long after, I'll keep living frugally.
Agreed, but think about how much MORE you'd save without the payment.
Using that idea to the extreme, think how much more I'd save without cable. Think how much more I'd save without electricity.
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