I am able to pay $33,000 cash for a new-car purchase or finance the car for 48 months at 6.35 percent. My home is paid for and I have $380,000 in savings earning 5.4 percent. Are there any compelling reasons not to pay cash?
Paying cash for a car is almost always the way to go — you can negotiate the initial price from a position of strength and you will save thousands of dollars in interest costs. With your large savings balance — and assuming you won’t have to pay any penalties if you withdraw some money — you should definitely pay cash.
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Driving for Dollars.