Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
I completely agree that newer cars have better safety and technology improvements for better ride, fuel economy even space but a 7 year loan would require that I carry full insurance coverage for those 7 years.
That extra 2 years of full coverage might cost anywhere from $500-$1000 per year.
I think if you keep saving that car payment even after you finish paying for the car and maybe the insurance difference when you go liability only coverage, you'll have a good buffer for when stuff starts to break.
I would prefer to keep a vehicle that is less than 10 years old. During the past 10 years, mulitple airbags, antilock brakes, and hands free bluetooth became standard on most if not all vehicles.
I carry full coverage with maximum legal limits, anyway. What's a person to do if they cause an accident? Pay the $10-15K to fix their car out of pocket? Everyone is human, you can make errors, too.
Why does this seem so highly unlikely? Maybe for you it is but for most others it is not. That's awesome if you aren't in that type of situation but if you have the money to be so confident about it, why even finance?
Because I can think of other things to do with $25K than sink into a toaster on wheels that might get totaled tomorrow.
My truck payment is $322 a month..in my mind it is $322 more a month than I need to spend. I could do a lot more around the house with that much money each month. What if I lost my job or a big unexpected expense occurred and that $322 was the difference between making or not making my mortgage? Id like to know I could dump my car and get something more affordable that would allow me to pay all of my bills.
At $385/mo, I don't really worry much about my auto loan. I mean, I could foot this bill working at a restaurant, if my world came crashing down and my career somehow evaporated. Hell, I could handle it mowing laws. Waxing cars. Whatever. It's a "bare minimum" vehicle for my purposes. AWD, new enough to have a warranty, fuel efficient, safe, roomy enough for friends and road-trips.
Also...life is about risk.
I mean, ever have a burger? Heart disease and obesity...kill a lotta people! but you enjoyed that burger, yeah? When's the last time you ran a few miles? Etc.
IDK man...If you have enough liquid in a mutual fund (not a 401k/IRA) to put into it and get out of the car, more power to you. But I've seen enough people who all of a sudden came into the store trying to get out of a car. The most common, in no particular order, are unexpected pregnancies staring at child support Pro-choice with a pro-choice partner who has an IUD., divorce/custody battles where the lawyer fees drive them to ruin Marriage is not in my plans. Never have, never will., medical events I carry insurance., and job loss I'm a versatile person with a myriad of saleable skills in a nearly bomb-proof career currently. If I lost it, I'd fall back on waiting tables or sales or whatever. Many options. I could walk into the military as an officer, as I understand, also (at least for another few months until I'm 30.). So many options if people are willing to work.. Most people don't anticipate how badly a huge medical event (cancer, bad accident) can cost; your insurance doesn't cover travel, time off from work, copays, etc...Yes, it does. Because I plan for that sort of thing. Because I know exactly how that can work.
I'm not saying its always a bad idea, or even that I would never do it myself. I'm just saying that it can really weld you into a car.
Somehow I don't think that being $2500 upside down in a car is a cancer patient's biggest fear.
At $385/mo, I don't really worry much about my auto loan. I mean, I could foot this bill working at a restaurant, if my world came crashing down and my career somehow evaporated. Hell, I could handle it mowing laws. Waxing cars. Whatever. It's a "bare minimum" vehicle for my purposes. AWD, new enough to have a warranty, fuel efficient, safe, roomy enough for friends and road-trips.
Also...life is about risk.
I mean, ever have a burger? Heart disease and obesity...kill a lotta people! but you enjoyed that burger, yeah? When's the last time you ran a few miles? Etc.
You pick and choose.
I am not singling you out per say just saying that most people would like to be able to dump a want (expensive car) rather than a need (house) if their world came crashing down around them. I don't know many that could afford a $400 a month car payment as well as utilities, a mortgage payment, etc...by washing cars or mowing lawns. If that was true id probably be doing that instead. Yes life is about risk and everyone does pick and choose. If that's your vice than that's awesome for you...and like I said in a previous post if I bought a summer/show car that I rarely drove and planned on keeping forever than yes I would do 84 months. In my opinion a car that is going to rack up miles and get normal wear and tear is not worth an 84 month loan. If I had an 84 month loan I would feel trapped.
I am not singling you out per say just saying that most people would like to be able to dump a want (expensive car) rather than a need (house) if their world came crashing down around them. I don't know many that could afford a $400 a month car payment as well as utilities, a mortgage payment, etc...by washing cars or mowing lawns. If that was true id probably be doing that instead. Yes life is about risk and everyone does pick and choose. If that's your vice than that's awesome for you...and like I said in a previous post if I bought a summer/show car that I rarely drove and planned on keeping forever than yes I would do 84 months. In my opinion a car that is going to rack up miles and get normal wear and tear is not worth an 84 month loan. If I had an 84 month loan I would feel trapped.
I would take out an 84 month loan on a new/like new motor home. As long as the interest was relatively low on it. A motor home is something you're likely to keep for at least 10 years, if not longer. You're probably not going to use it more than 4 times a year.
Now, in terms of that length on a car, I can see the scenario like you stated: a vehicle that you barely drive and plan to keep forever.
Somehow I don't think that being $2500 upside down in a car is a cancer patient's biggest fear.
Finances are a big issue when you have cancer. There's a lot of uncertainty.
Plus there's a good chance you won't be in any condition to do anything while you're getting treated.
The last thing you need is to have to try to dump an albatross car when you can barely get out of bed.
Finances are a big issue when you have cancer. There's a lot of uncertainty.
Plus there's a good chance you won't be in any condition to do anything while you're getting treated.
The last thing you need is to have to try to dump an albatross car when you can barely get out of bed.
This is where your permanent and long-term disability comes in.
I took an 84 month loan on my wife's truck when GM was offering zero percent down and zero percent financing
Truck cost 50k. I bought 50k worth of Muni bonds instead and my tax free interest stream subsidizes car loan which is all principal anyhow.
GM includes upside down protection in loan. Meaning if car gets totaled or stolen you are guaranteed the payment will be at least size of loan. I also took and 84 month warranty at purchase also with zero down.
Pretty much my wife has to just not get sick of truck for 84 months which is a long commitment
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.
Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
