Just my opinion

rk911 wrote:

wing_zealot wrote:
Here's my scenario. About 14 years ago I bought my last camper. I financed at 4.2 percent. I kept the "cash" invested. Over the 12 year life of that loan my "cash" earned over 7 percent average annualized return. I am ahead about 5 percent per year. Paying cash forme would have been dumb.

your math works except you haven't taken risk into the equation. risk that your income stream will slip or disappear; risk that something else in life will rear its ugly head necessitating a change. risk. my wife and I were "normal" for a long time. car loans; RV loan, this loan, that loan. then, as Dave Ramsey would call us, we became weird. we paid off the house, started paying cash for cars and yes, we saved, saved, saved for what will likely be our last MH and paid cash for it. the other end of that stick is save, invest, save and then invest more. live beneath your means so later you can pretty much do as you please.

When you consider a loan at 4% ± vs. a well balanced stock and bond portfolios long term average annual return of 7.5% the risk is pretty low. The other side of the coin is, you haven't considered the risk that a period of high inflation could keep moving that target just out of your reach. Then it becomes like the carrot and stick, you can never quite catch that carrot. Seems to me the risks are about the same either way.