Great Loan Rate!!

Gdetrailer wrote:

IndyCamp wrote:

dahkota wrote:

ScottG wrote:

Your going to get some heat for that but I agree.
Never buy toys on time. Save a few bucks and buy something used but decent.
That strategy has served me well and now I'v retired at 50.
Just a suggestion - sorry for the hijack.

Interesting. We always bought new, got loans most of the time. We made sure our retirement and investment accounts earned a higher % than our loan rates. Never saved money in a bank as the interest rates were crap. But we managed to retire at 47 with no debt. And we are not members of the 1%. I don't think we are member of the top 10%.

We have a loan on our current rig, which we full time in. We have more money in our retirement and investment accounts than we did when we left almost 1 year ago. Our accounts are making more money than our loan payments, the interest on the loan is tax deductible, and we don't have to worry about capital gains tax from selling assets.

Sometimes, borrowing money is cheaper than spending what you have.

Absolutely.

I never understood the "always pay cash" crowd.

If you can borrow money at 2.99%, but earn greater than that on your investments (not hard to do), why would you not take the loan and let your money work for you?

I think it's funny when people look at me sideways for buying new cars/trucks and financing them. I am financing them at 0.0%, or, at most, 1.9%. The interest I pay on 40K over three years at 1.9% is less than I would earn in interest by investing that 40K.

"Borrowing" at low interest rates while having majority of your assets "invested" works ONLY if the market never crashes or tanks.

Consider yourself "lucky".

I am not so "lucky" with "investments".. So far I have gone through not once, not twice but THREE TIMES in which the markets have crashed and tanked..

My 401Ks, IRAs have not as of yet FULLY recovered from these paper losses, they are really worth LESS than what I and my employers put into them.. My only saving grace is a handful of stocks I was able to purchase through a previous company discount plan during one of the "tanked" periods..

If it wasn't for those market crashes and the outrageous cost of medical insurance now days I could have been retired a few years ago..

I OWN my home, put a large down payment on it, paid it off in 11 years.. The interest I DID NOT PAY since I paid it off early was reinvested in fully remodeling it, adding on a new living room/basement and even paid for a three and half stall garage too boot. I BORROWED NOTHING to make those changes, I paid CASH that I saved up from not paying a payment to a bank.

I have bought vehicles and PAID THEM OFF EARLY (5 yr loan and paid off in three yrs), and SAVED the money that WOULD HAVE gone to the bank as interest as a future down payment for the next ride..

While I do feel "cash is king", I use a MIX of saving up cash and being extremely picky about borrowing for no real reason..

To me, borrowing needlessly cuts into your buying power by saddling you with money sapping interest..

Anyone who thinks they are getting a "deal" by over extending themselves on credit is being foolish..

A RV is not a "needed" item, it is a WANTED ITEM so in my eyes I will not buy a RV on a loan.. If that means I buy a used one that IS what happens.. My current TT is a 1984 which I bought for $700 CASH, reconstructed it for about $5K CASH and have now used it for 7 camping seasons.. If I had bought a new TT I would have spent easily $25K PLUS an additional $20K OF INTEREST!!!! for a total of $45K!

Lets see how the math "works"

$45K for "new" - $5.7K "used" = $39.3K difference..

People who have a habit of borrowing excessively tend to FORGET ALL ABOUT THE INTEREST THEY MUST PAY IN. They typically do not count the interest cost as part of the purchase or ownership..

So in reality I have $39.3K MORE MONEY in my pocket by buying a used one and fixing it than if I bought a new off the lot one..

I have more buying power to save or buy other NEEDED ITEMS..

Credit used in a sparing way, only when NEEDED is your "best" policy..

For this statements. I am not so "lucky" with "investments".. So far I have gone through not once, not twice but THREE TIMES in which the markets have crashed and tanked..

You doing something wrong. The stocks never crashed! Yes, it tanked but it recovered about 1 to 2 years ago. I bet you sold your investment when it tanked instead of leaving it there and let it recover, bad move on your part. When stocks tank, I buy more stocks, not sell them.