I'm thinking of purchasing a used G35 coupe ($20,000 to $25,000) and I have about $25,000 in cash that I have saved for a car. I purchase another vehicle every five years by allocating a set amount each month into an ING savings account. Anyways, I'm thinking about financing the vehicle (100%, no down payment) and removing the payment amount from the ING account each month. Does that make sense? I figure I'll be earning some interest on the principal while paying down the car loan so I should come out ahead versus if I completely pay for the vehicle in cash. Any thoughts?

Thank You

 

if u have the cash to pay it off i would just pay it off...unless you want to build ure credit..finance it..

 

Finance.. let your money make you money. Atleast thats what I would do. But ultimately it should be your call based on your plans for the money you have saved.
Cars are not investments, typically. They depreciated. You wont see a return on the cash you spend on it.. but you will see a return on your invested cash.

 

Need some more details:
ING account rate
Vehicle financing rate
Monthly payment

 

I think if you can get a finance rate that is less than the rate that you are earning on your ING account, then finance the car. If it costs more to finance, then buy the car with cash. It all depends on how much you would be paying in interest on the loan, compared to how much you would earn in interest on your savings.

 

I always pay cash for everything I can. Nothing like owning what you have with no debt.

My take on purchases (besides a house or college) is that if you can't afford to pay cash, then you can't afford it.

 

id buy the car now with cash, no telling whats gonna happen with ANY bank in this economy

 

How bout not so extreme, maybe just 10k down? I would much rather have some cash in the bank for the raining days.

 

Ummm, chances are you will be paying more interest on the loan on your car than the money is going to be earning in the account. A very good chance of this unless you got some crazy stuff going on. I waited and sold stock from my portfolio to buy my G in cash. Glad I did this since the market has tanked the last year or so, but I have a G, fully paid off, and no outstanding debt. It is a nice thing to have.