[USER]

Please be nice. Our saving got basically drained in the last year and I’m needing a new vehicle bad! We’re planning to our purchase a small SUV from a friend for $17k.

After listening to the episode on car loans, I’m wondering the best route.

We could get a loan for 80% of the value from our bank at 8% or take it out of a non-retirement fund that has been doing well the past few years.

I don’t want to rob our future selves but car payments feel like such a waste of money too.

[Rachel]

If that same vehicle purchased elsewhere would cost more. I’d consider this with the loan (try CUs, first), but it also depends on how quickly you can replenish emergency fund and pay off the loan.

[Shane]

Take out of cash account and buy it. If rates drop down to 5 range consider taking it back out and I vesting it.

Not bad to sell at high stock values now.

[Heather]

If you live in Colorado or another state with extra EV tax credits, go look at a lease. I just got a 2025 Nissan Leaf Plus model for 0% down, taxes, fees and $20 a month payment.

Yes, $480 total in payments for 2 years, not per month.

With all the gas it’ll save, it’ll be a money maker for us.

[Jenny]

A friend leased a Tesla for $349 per month. That might be an option is the deal is still available.

[Dave]

Selling investments in a well-performing account will not only rob you of future gains, it will hit you with capital gains tax on top of that.

[Ashley]

You are more in the $8000 car range at this point. You can get a toyota rav4 with about 120k miles on it and it will be reliable for at least another 100k.

Build up emergency savings again. And the 8% IS robbing from your future self.

[Bryan]

Cheaper car. What do you have in cash? Do you have a car to sell/trade in?

[Emma]

What did the savings account get drained by? Are these habits that are forming that are getting you into trouble?

17k is a lot for a car if you have a drained savings acct.

[Randy]

8% no thanks. Taking from a taxable account and realizing gains = more taxes. You should find a cheaper car.

Only buy what you can easily pay for.

[Tony]

You can get an older reliable Honda or Toyota for half that amount. Focus on your needs that don’t require a loan and then build up to wants when you’re in a better financial position.

[Frank]

Don’t take out 8% loans to buy vehicles if you don’t have to. But why are you fixated on that vehicle?

I would be spending less if you are that strapped.

[Brad]

Buy something you can pay cash for… I wouldn’t add a car payment with no savings.

[Amy]

Are you sure your bank will lend you money at 8% on a private party sale? Some banks will only lend to you if you’re purchasing through a dealer.

So, if all you’ve done is check rates online, you probably need to talk to someone at the bank to confirm they lend on private party auto sales.

[Juliett]

There’s not enough information…
If you have no savings, buy a cheaper car.

[Author]

Posts