Great truck buying experience

[Mike]

Opportunity cost of capital you finance wizards.

English please


:-)

[slow99]

English please


:-)

I would never pay cash for a vehicle unless, for some reason, I want to lock in that rate of return. I would never "lock in" a 1.9% rate of return. Hell I still have some Undergrad and Graduate student loans outstanding. Why commit capital to forego a ridiculously low interest rate when you can put it work elsewhere? Once I pay that cash up front, it's not available to invest and earn more than 1.9%. It's the very basis of all Corporate Finance; every business in the world does it daily. Projects are deemed profitable (positive NPV) based on their return versus their cost of capital. If I can borrow at 2%, I will invest in projects that return more than 2%.

[FreightTrain]

He tried to "solid barg" instead of the honest answer.

"I don't have $35k laying around for a truck"

LMAO how about this answer. It cost me $1,700 to borrow 35k for 5 years thats a whopping $340 a year. Who in their right mind would tie up 35k for that little of cost. Also I could of went 0% but that would of cost me $5250 in rebates. Subtract the $1,700 in finance charges I'm still up $3500 over all.

There is a reason I have an 818 credit score lol.

[Broncojohnny]

You can put the cash to work in a blue chip stock and make 3-4% dividend yield growing at 5-10% a year. Not sure why anyone would pay cash for anything.

[Mike]

LMAO how about this answer. It cost me $1,700 to borrow 35k for 5 years thats a whopping $340 a year. Who in their right mind would tie up 35k for that little of cost. Also I could of went 0% but that would of cost me $5250 in rebates. Subtract the $1,700 in finance charges I'm still up $3500 over all.

There is a reason I have an 818 credit score lol.

You're confusing me with numbers!