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Old 06-03-2008, 05:14 AM
 
10 posts, read 25,046 times
Reputation: 12

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Hi

Need some advice I thinking of buying a small business and want to have a car that I can put "through" the business.

My question should I :-

* Buy a car outright

* Lease a car

* Finance a car

Any thoughts ?

Thanks in advance
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Old 06-03-2008, 09:39 AM
 
3,553 posts, read 6,786,557 times
Reputation: 2304
Leasing is generally the most expensive way to "own" a car.

Financing is the second most.

Buying a year old, low mileage car for cash and "running the wheels off it" is the next.

Buying a "beater" and keeping it running with bubble gum and duct tape is the cheapest.

I was self employed almost my entire career. My company made enough (most years) that I could've had a Benz/BMW/other as a "company" car. Instead I did number 3 above and put the $5K/year difference into my retirement account. I retired in my early 50s.

golfgod
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Old 06-03-2008, 10:33 AM
 
Location: Apple Valley Calif
7,475 posts, read 19,569,061 times
Reputation: 5580
Quote:
Originally Posted by golfgod View Post
Leasing is generally the most expensive way to "own" a car.

Financing is the second most.

Buying a year old, low mileage car for cash and "running the wheels off it" is the next.

Buying a "beater" and keeping it running with bubble gum and duct tape is the cheapest.

I was self employed almost my entire career. My company made enough (most years) that I could've had a Benz/BMW/other as a "company" car. Instead I did number 3 above and put the $5K/year difference into my retirement account. I retired in my early 50s.

golfgod
Every once in a while, you find a really intelligent answer in the forum. This one tops the list. Listen to this man, he knows of which he speaks.....
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Old 06-03-2008, 11:14 AM
 
5 posts, read 3,109 times
Reputation: 10
Quote:
Originally Posted by jbsvilla View Post
Hi

Need some advice I thinking of buying a small business and want to have a car that I can put "through" the business.

My question should I :-

* Buy a car outright

* Lease a car

* Finance a car

Any thoughts ?

Thanks in advance
You are always better off the pay cash for a used car, even if it is for business use. If you can not pay cash, go for a low-interest loan.
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Old 06-03-2008, 11:15 AM
 
3,698 posts, read 9,985,474 times
Reputation: 2593
Don't forget that the tax deduction for mileage is the same for a 1995 Corolla as it is for a 2009 Navigator.
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Old 06-03-2008, 02:47 PM
 
Location: Lake Arlington Heights, IL
5,481 posts, read 10,057,369 times
Reputation: 2784
Quote:
Buying a year old, low mileage car for cash and "running the wheels off it" is the next.
If I may add to the above wisdom. Perhaps a 2-4 year old car will be a better value than a year old model. The older the car, the less depreciation you pay up-front (in theory, there are some exceptions) You can find a 2 year old car with original factory warranty remaining. You can find even older used car values with factory certified extended warranties. You do pay extra, but I found these to be much less expensive than 3rd party extended warranties without the fear of the warranty company dissapearing. This takes some of the initial risk out of buying someone else's problem car. I also recommend getting a one month subscription to car-fax and running a report on the cars VIN. I did this on a van a dealer wanted to sell me in IL. It was returned to the manufacturer under Ohio's Lemon Law. When I mentioned this as major reason in cancelling sale the dealer stated "We were going to tell you upon delivery" Riiiiiiiiiiiiiiiiiiiiight.
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