No good reason not to pay cash
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.
|Here are this week's reader questions:|
|•||Car's onboard data system could haunt you|
|•||Do the same dealer fees apply when buying or leasing?|
|•||Should I use my savings to pay off my car loan?|
|•||Is it better to pay cash or finance a new car?|
If you have a question for Terry, e-mail him at
Driving for Dollars.