But to work, you need a car. Nice little hamster wheel they got must of us on.

I don't disagree with this, I just don't think it's exclusive to financing. If the interest rate is so low that it's insignificant, why give them all of the money up front? Keep it in your savings, investments, emergency, whatever.

*shrug* I've never been in a situation where it was a bad idea. Yeah, a loan with a double-digit interest rate is not smart, but to put $40k down for a car vs paying 2% interest seems like a worse idea to me.

Of course, I find that many people's ideas of "smart" financial advice makes no sense to me. The whole concept of "never use a credit card" or "never get a loan" leaves me scratching my head.






The Jedi Master

With the glut of finance deals in the UK at the moment there are loads of 3 year old cars. Plenty of choice to get a good one at a good price. I never buy new. I bought my current car cash for a good price when it was 3 years old. Still drives beautifully now it's 16 years old. Choose carefully and look after it. The money for its replacement is in place. Apart from houses we have never bought anything on credit and never will.

RedToo.

Same here RedToo, always buy 3-4 yo cars and don't have a credit card. Only debt is our mortgage, and even then the rate is at a historic low compared to what my parents had to pay in the 70s and 80s. God knows how they raised me and my brother on a single Forces salary, but they did it and I don't remember any hardship (at least on my part).

I agree. There's so much money to earn in using credit cards alone, I'm surprised so many people refuse to use them. I use them for every single purchase. Pay it off at the end of the month, and it doesn't cost me a dime. On the flip side I end up with around $5000 cash back on one of my cards alone for doing this.

Of course the CC company is banking on your running up your 50k limit and hitting you with finance charges etc. But using them wisely is 10x better than always paying for stuff directly out of your checking account.

With regards to financing things, I finance lots of things as many of those are also used to make money. It keeps your credit great and your buying power even better. As a certified car nut, if I want a vehicle, I will definitely go out and buy it/finance it or whatever. If there's one thing I've learned in my short existence on the planet, that you only have 1 go at this. You might as well try to enjoy it. For me, that means owning all the crap I want. I, or anyone else, might not be around tomorrow.

Exactly

Thanks for all the opinions guys. Appreciate it.

Actually, what I got from that article is that 0% *is* a "free lunch", but only for those who qualify. And that's how they get *some* people, by advertising a great interest rate only for many (if not most) to be told they don't qualify but, "Since you're already here, let's see what we can do".

It's then up to you if you want to continue or walk, but I can see why they do it, giving out a free lunch to some (along with the occasional free breakfast donuts and coffee).

++++++++++

We also purchase everything on credit cards but haven't carried a monthly balance in years. It's nice to know that if we ever need to we can (and they try to entice you by constantly raising the limits), but I don't see that ever happening other than a serious medical emergency that wipes us out.

My mom has also been crazy strict with the family budget (don't I know it growing up), while using credit cards and buying new cars with financing, but with very low to no interest and never carrying a CC balance (also with above 800 credit). My wife is getting involved in their finances in anticipation of helping to manage it (they're moving in and approaching 80), and she's impressed. With cooking and financials, they connect. My father and I would be screwed without them in our lives.

Yeah it works.. we did it with a 2005 Mitsubishi.. and we paid a good priece for it.. The only danger with it is if you miss a payment you get hit with all that back interest.. What we did was add a minimum of 12% extra to the payment sometimes more.. We would up paying the car off 10 months early and were free and clear.. In 2015 we gave the car to our daughter.. It can work..



Everyone is not in a position to do that though.. just pay cash for everything. 0% interest can be a good thing. Credit is a good thing.. providing you use it wisely. That is the rub for a lot of people though..

One thing that's changed relatively recently - a new car now could conceivably last 20 years without major repairs.

I never thought I'd even consider buying new, but even with interest charges I'm reconsidering now.

I'm old enough now that despite the added cost it could "almost" be the last car I ever have to buy. I'd pay a bit extra for that.