Most sales people have no shame as long as they get paid. The added fees for "filing paperwork" is just extortion. That being said it should be the customers responsibility to do their own due diligence.
@@kidsmooth6549 Yea It's one thing to lie and mislead someone into thinking they can comfortably afford something but at the end of the day the car salesman is there to sell you the car you want. They aren't your mother, spouse, or accountant and have no right to tell you what do with your money.
There is no way a guy like that is paying any interest. The only reason they'd go through financing is to get the price down and then they'll want to pay cash.
Ally, Amex or any other high yield savings banks are offering 4.35% currently, its a no brainer to finance when the interest offered on that loan is 1.9%. Total interest paid at the end of 36 months is 1625.91, and the interest from his savings had he kept the 55k in there would be 7177.5. Realistically he'd either have that 55k in an index fund like the SP500 or a high yield dividend one such as SPYI that pays 11% dividends so he'd make closer to 17k over 3 years. Would be monumentally stupid to pay cash.
Unless interest is double digits, it almost always makes sense to finance and invest the difference. Don't buy a car you can't pay cash for but put the cash in an asset that will cash flow enough to pay for the cars financing.
@@Micah1Powell I disagree. If your loan rate starts getting up to 7%, I'd have to give serious though about paying cash. Stocks have returned about 10% on average historically. Returns the past ten years have been significantly higher. There is a strong likelihood that there will be a period of lowered returns for a number of years and a return to the mean. Of course, no one has a crystal ball so taking the loan at 7% may pay off but there is a very strong possibility that you'll break even at best and potentially fall behind.
Another potential benefit is reducing your income tax burden. If you sell $55k in stock in a year that's potentially pushing you up into a higher tax bracket. If instead payments are stretched across 3,5,7 years the savings in taxes by not needing to liquidate stock all at once could well exceed the interest of the loan.
That’s not true, at 1.9% the returns from his investment most likely yield higher so it would be more beneficial for him to keep the money invested and make the payment each month
You drive the price down with finance and interest that looks poor value. Then the first month you call the finance company and pay it off for cash, undoing the interest they thought they were going to get off you. Thats how i do it in the UK.
On new cars yea but old cars really don't depreciate a lot, you'll loose most of your money in maintenence and repairs, but likely sell it for the same price you bought it for if you take care of it.
Hey it’s respectable. Never judge anyone by their cover. Had a software engineer buy a Lexus from me making $200k a year, humble as can be but successful because of his frugality
My local dealer doesn't bother with negotiating on the price, everyone pays wholesale for new cars. they only negotiate on the interest rate and that's just objectively based on creditworthiness. And they try to make money selling warranties, which is fine by me too. That's how it should be. Never understood how salespeople can justify selling to one person for more than another.
It made sense when access to things was harder when global supply chains didn't exist, so now there is no price competition, only would still exist in illegal things like selling drugs as thats something that isn't so globally accessible
I never understood that. Once in a while there's a good deal, but usually you spend more time looking than it's worth. You might as well work and earn extra income.
Last Saturday we went out for breakfast and I told the wife lets look at a different vehicle. Went to the Lexus dealership and 120 minutes later drove home a brand new LX 600 Ultra Luxury SUV. The funny part was the salesman was about to start talking financing, and I just said nah, and pulled out the checkbook.
Meanwhile the reliable middle class guy who comes in with all their information and does everything you're supposed to do in negotiations somehow ends up paying over sticker without half of the amenities the dealership promised. Why play this guy's games when he pays less? Do the rich HAVE to get richer? Is it some kind of universal law that even trumps corporate profit motive?
Depends. Some would say yes, others would argue depending on interest rate that it’s better to have cash on hand and invest it in something that beats out your interest rate, such that you take more money home at the end of the day while still maintaining cash flow and liquidity.
When the interest rate is 0-2.9% financing is the better way to go. Anything past that cash is king. However, negotiating like your financing could just be counterintuitive because most dealers just slap a cash addendum after they find out. So the key is to not be an ass, unless the dealer is just a straight up scum, in that case just fucking walk. And negotiate with someone you click with.
Sometimes you need to take the manufacturer's financing to qualify for rebates. Negotiate the lowest possible purchase price including rebates, take the loan (making sure that there is no pre-payment penalty) and pay it off before the first payment is due.
Theres people like that who actually can't afford it, but they still go for it. I couldn't imagine being a salesman walking people into bad decisions.
same here, I don't want to be responsible for really messing up people's lives
Most sales people have no shame as long as they get paid. The added fees for "filing paperwork" is just extortion. That being said it should be the customers responsibility to do their own due diligence.
@@kidsmooth6549 Yea It's one thing to lie and mislead someone into thinking they can comfortably afford something but at the end of the day the car salesman is there to sell you the car you want. They aren't your mother, spouse, or accountant and have no right to tell you what do with your money.
There is no way a guy like that is paying any interest. The only reason they'd go through financing is to get the price down and then they'll want to pay cash.
Depends on what his investments are yielding. If interest is below 2% it’s a no brainer!
Ally, Amex or any other high yield savings banks are offering 4.35% currently, its a no brainer to finance when the interest offered on that loan is 1.9%. Total interest paid at the end of 36 months is 1625.91, and the interest from his savings had he kept the 55k in there would be 7177.5. Realistically he'd either have that 55k in an index fund like the SP500 or a high yield dividend one such as SPYI that pays 11% dividends so he'd make closer to 17k over 3 years. Would be monumentally stupid to pay cash.
Unless interest is double digits, it almost always makes sense to finance and invest the difference. Don't buy a car you can't pay cash for but put the cash in an asset that will cash flow enough to pay for the cars financing.
@@Micah1Powell I disagree. If your loan rate starts getting up to 7%, I'd have to give serious though about paying cash. Stocks have returned about 10% on average historically. Returns the past ten years have been significantly higher. There is a strong likelihood that there will be a period of lowered returns for a number of years and a return to the mean. Of course, no one has a crystal ball so taking the loan at 7% may pay off but there is a very strong possibility that you'll break even at best and potentially fall behind.
Another potential benefit is reducing your income tax burden. If you sell $55k in stock in a year that's potentially pushing you up into a higher tax bracket. If instead payments are stretched across 3,5,7 years the savings in taxes by not needing to liquidate stock all at once could well exceed the interest of the loan.
“Sharpen his pencil” ✏️
L M F A O
😂😂😂😂
A guy like that pays no interest.
He'll negotiate the price, and buy cash.
That’s not true, at 1.9% the returns from his investment most likely yield higher so it would be more beneficial for him to keep the money invested and make the payment each month
Yep.
@@brucedavidson7422 This. This is what people who overpay on loan interest rate student loans will never understand.
As he should, I’m gonna do the same
@@brucedavidson7422Then why wouldn’t banks do the same thing instead of lending money? You’ve taken risk out of the equation.
There’s a reason people that wealthy end up that way and it’s because they are frugal with everything they do
That's a lie they tell you for just long enough to raid your pension fund.
Yeah I see billionaires saving big with those cheap mega yachts.
Yes they are 😂 my father uses ductape for electrical, plumbing, light fixtures, holes in the wall. He rents out rvs and makes $30k a month 😂
So does exploiting the workforce
Looks like you attracted a bunch of mindless commies...
You drive the price down with finance and interest that looks poor value. Then the first month you call the finance company and pay it off for cash, undoing the interest they thought they were going to get off you. Thats how i do it in the UK.
In the US some states allow the lender to charge you a penalty if you pay it off early…
@@kf5ydulol, the banks always win.
Cars are depreciating assets. Anything spent is basically lost. Get that price down as low as possible!
On new cars yea but old cars really don't depreciate a lot, you'll loose most of your money in maintenence and repairs, but likely sell it for the same price you bought it for if you take care of it.
Hey it’s respectable. Never judge anyone by their cover. Had a software engineer buy a Lexus from me making $200k a year, humble as can be but successful because of his frugality
Buying a Lexus is frugal? 🤔
@@theatomic430it is for A luxury car purchase
@@theatomic430yeah, they’re super reliable meaning you won’t spend a ton on repairs/maintenance beyond the minimum
@@theatomic430 he probably stayed that way until the net worth started doing the work for him
@okchx It doesn't have to be a new lexus. I bought a 3 year old lexus for 23k, income is 150k. Even then I didn't want to spend so much lol
You should never overpay regardless of whether you can afford it or not
Jokes on you, I'm not pretending.
My local dealer doesn't bother with negotiating on the price, everyone pays wholesale for new cars. they only negotiate on the interest rate and that's just objectively based on creditworthiness. And they try to make money selling warranties, which is fine by me too. That's how it should be. Never understood how salespeople can justify selling to one person for more than another.
It made sense when access to things was harder when global supply chains didn't exist, so now there is no price competition, only would still exist in illegal things like selling drugs as thats something that isn't so globally accessible
I believe in all of you, you’ll get there
Oh my gosh this is my dad. He still coupon clips
Every penny counts.
I never understood that. Once in a while there's a good deal, but usually you spend more time looking than it's worth. You might as well work and earn extra income.
@@Excalibur2 somebody's never gotten 100 bucks of food for 20.
@@goodgoodnotbad9573 haha definitely not. Anything good? If I could find deals like that, I might start going for it.
Most people are financially illiterate and make dumb decisions when buying a vehicle.
It’s an art
I would get these people at Honda all the time lol. Super nice, but you could literally point them out after the first 30 of them lol
Last Saturday we went out for breakfast and I told the wife lets look at a different vehicle. Went to the Lexus dealership and 120 minutes later drove home a brand new LX 600 Ultra Luxury SUV. The funny part was the salesman was about to start talking financing, and I just said nah, and pulled out the checkbook.
I'd think a guy like that gets a car for free from his friend's company, in exchange for dropping by weekly and giving management advice 😂
at least its a deal
Mass transit is cheaper.
Fixed income = Dividend income.
Both sides of this process are disgusting.
100k/month and you’re buying an 70k boring soccer mom crossover that’ll depreciate to shit in three years? I doubt it
Meanwhile the reliable middle class guy who comes in with all their information and does everything you're supposed to do in negotiations somehow ends up paying over sticker without half of the amenities the dealership promised. Why play this guy's games when he pays less? Do the rich HAVE to get richer? Is it some kind of universal law that even trumps corporate profit motive?
I drive a 2011 200000 mile lincoln town car with no reverse got hundreds of thousands in the bank with a paid for house wonder why lol
I don’t get it, it’s better to negotiate and then pay cash to avoid interest all together right?
Depends. Some would say yes, others would argue depending on interest rate that it’s better to have cash on hand and invest it in something that beats out your interest rate, such that you take more money home at the end of the day while still maintaining cash flow and liquidity.
When the interest rate is 0-2.9% financing is the better way to go. Anything past that cash is king. However, negotiating like your financing could just be counterintuitive because most dealers just slap a cash addendum after they find out. So the key is to not be an ass, unless the dealer is just a straight up scum, in that case just fucking walk. And negotiate with someone you click with.
Sometimes you need to take the manufacturer's financing to qualify for rebates. Negotiate the lowest possible purchase price including rebates, take the loan (making sure that there is no pre-payment penalty) and pay it off before the first payment is due.
@@chiplangowski3298 exactly, nobody is making you wait for the payments to pay it off
If the interest % is lower than the % yield on investments then no, good tool is using an amortization calculator.
I had a guy make 80k a month. Just crazy
My house cost 55k
Was this 40 years ago?