I get passive income of on average R30,000 which is outside my salary. Have taught myself to live within my means meaning all my expenses are usually covered by my Full time Job salary.Ive been saving up to buy a car for the past four months and have saved up at least R84k. Wd i rather buy the car cash or finance the car ? Any advantages of bank financed car ?
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Buying Car Cash
- Thread starter jacksonc
- Start date
AlmightyBender
Executive Member
The only advantage I can think of is you will improve that banks financial results, and thus the economy, by a microscopic miniscule amount. Buying a car cash saves you HUGE amounts in interest and is always the best option if it is possible. Go for it and enjoy your financial freedom dude
If you have a passive portfolio as you state the following should be considered:
Cheapest route is to buy for cash as you will reduce your interest burden but is this the most beneficial? I would say no as you have developed a passive portfolio you need to determine the current cost of your working capital ( the money tied up generating you the passive income ) if this is greater than the vehicle lending rate then finance the car. If you dont want to grow your passive portfolio then ignore what i have said.
Just remember in this economy CASH is king and access to liquidity is critical, try setup an access facility as this gives you thebest of both worlds.
Cheapest route is to buy for cash as you will reduce your interest burden but is this the most beneficial? I would say no as you have developed a passive portfolio you need to determine the current cost of your working capital ( the money tied up generating you the passive income ) if this is greater than the vehicle lending rate then finance the car. If you dont want to grow your passive portfolio then ignore what i have said.
Just remember in this economy CASH is king and access to liquidity is critical, try setup an access facility as this gives you thebest of both worlds.
Rouxenator
Dank meme lord
Wether you trade in or have cash in hand its always good to pay for as much of the car before hand. I never buy a car if I cannot put down at least a 50% deposit. If you are buying a car valued under R250k you put down 10% and apply for a low interest rate loan on the car and then a month later you make a down payment with the remainder of the cash you have. They cannot penalise you for that and you score a better interest rate.
Cius
Honorary Master
Buy cash. Much better than paying interest to some bank.