Quote:
|
Originally Posted by wac77
Name the investement that guarantees you an after tax return above the car loan interest rate every year for the next 4 or 5 years, and I'd agree. But then again - forget about cars, why aren't you and everybody else just getting rich by making that investement on borrowed money??
|
Of course there's no guaranteed investment. Risk and return are inextricably linked. I financed approximately half the cost of my car at 4.49% with a 5yr term. At the time I settled financing, the 5yr treasury bond was yielding 4.22%. Add in some risk premium with a strong-credit corporate bond, and you're close to the goal with little risk (before tax).
It's all about your situation and risk tolerance. Instead of buying outright, I split the difference and hope to beat that 4.49% year over year. So far so good.