tag:blogger.com,1999:blog-5643378785479457434.post1414818698906255416..comments2008-09-11T19:38:00.736-04:00RDShttp://www.blogger.com/profile/03952458580182359716noreply@blogger.comBlogger5125tag:blogger.com,1999:blog-5643378785479457434.post-49758646180541375462008-09-11T19:38:00.000-04:002008-09-11T19:38:00.000-04:00Tuuli,<BR/><BR/>Thanks for your comment. Buying an older but reliable car - especially from someone that you know and trust - can be great way to get a good deal on a car. I really like your idea of making an artificial car payment so that you will be financially prepared to buy your next car.<BR/><BR/>I have been toying with publishing a post on buying a car. Given the interest, perhaps I should write it sooner, rather than later.<BR/><BR/>RDSRDShttp://www.blogger.com/profile/03952458580182359716noreply@blogger.comtag:blogger.com,1999:blog-5643378785479457434.post-87354426078522630572008-09-11T15:02:00.000-04:002008-09-11T15:02:00.000-04:00My husband and I need to buy a second car, and we've been figuring out what the best solution for us is. Our initial plan was to buy a new car and drive it for over a decade. However, we found out that a friend of ours is selling their old car because they're moving to NYC, and we've pretty much decided to buy that instead. It's old and cheap, but in decent condition, so we should get a few years of driving out of it. In the meantime, we plan to start making monthly "car payments" into an online savings account. Hopefully, by the time we need to buy our next car, we'll have a nice lump in there to cover most, if not all of the price. Letting our car savings accrue interest is obviously better for us than paying interest on a car loan. What do you think?<BR/><BR/>Oh, and before I saw this car discussion I meant to comment to say, keep up the good work! I check here daily, and I find your advice very useful.tuulinoreply@blogger.comtag:blogger.com,1999:blog-5643378785479457434.post-22294327637769696002008-09-09T19:58:00.000-04:002008-09-09T19:58:00.000-04:00Anon - thanks for your question.<BR/><BR/>I have mixed feelings about auto loans. Like many aspects of financial planning, auto loans by themselves are neither good nor bad, but can be used responsibly or irresponsibly. <BR/><BR/>They have a number of good qualities:<BR/> - Cars are both expensive and (outside of major cities) absolutely essential. Without loans, many people would simply not be able to buy a car.<BR/> - Unexpected job changes or family size changes might require the purchase of a new car on short notice. A loan can make this possible.<BR/> - In today's economic climate car loans can be had at relatively low interest rates.<BR/><BR/>However, car loans have their downsides:<BR/> - Taking out a car loan means spending your future income on an asset that will rapidly lose value.<BR/> - Auto loans enable people to purchase more expansive cars than they can responsibly afford to.<BR/><BR/>I believe that spending too much on vehicles is one of the most common major financial blunders made by American families. However, the root of this problem is a poor purchasing decision. The auto loan is merely the enabler. Car loans make sense in some circumstances, can be used responsibly, and can be an important part of your financial plan.<BR/><BR/>Your plan to purchase a vehicle that fits your needs and keep it for a long time sounds like a good financial decision.RDShttp://www.blogger.com/profile/03952458580182359716noreply@blogger.comtag:blogger.com,1999:blog-5643378785479457434.post-4876262122909610442008-09-09T12:44:00.000-04:002008-09-09T12:44:00.000-04:00I like the idea of thinking about the actual cost of purchasing an item if you are using a credit card! It certainly will make me think very hard about buying it now or waiting until I can pay "in cash".Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-5643378785479457434.post-1553496334130643682008-09-09T02:47:00.000-04:002008-09-09T02:47:00.000-04:00How do you feel about getting a loan for a new car?<BR/><BR/>My family recently had to purchase an 8 seat SUV and we did not have enough cash to purchase it.<BR/><BR/>We were hoping that we will be able to keep the car for 10+ years, making it worth buying new.Anonymousnoreply@blogger.com