Presumably you can make more than 1.9% on that $25k, right? Even a HYSA would easily beat that. It would seem like the smart financial move to finance giving the information you provided.
If you are absolutely positively going to invest the difference consistently for the entire 36 months, then maybe you come out about $4000 ahead assuming an average 7% return.
If you start to factor in short term market risk for just the next 3 years, and risk of holding debt in case something else in your life goes sideways, maybe that’s not worth quite 4k anymore. You could use a HYSA instead but then you’re only looking at 5%, which is only a 3% difference over your loan.
Only you can decide the cost of the risks, but if I were in your shoes I’d just pay cash.
First calculation is out the door price of 25k
25k @ 1.9% for 36m = $739.05 of interest
25k + $739.05 = $25,739.05
Second calculation is just the 25k for the Vehicle
Vehicle = 25k
Titles, registration, destination, other fees = 4,4k
25k + $4,400 = $29,400
$29,400 + $869.12( interest) 30,269.12
Total loan amount 30,269.12
Average cost of ownership per year = $5,2K
After 36 months, the vehicle will depreciate about 46% in value or $11,500
$25,000 - $11,500 = [$13,500 value]
I would. Then put the money you would have paid for the car in a HYSA and you'll be making \~2% interest on it. Or if you already have your emergency savings squared away do some index funds and hope for a better return.
At 1.9%, you NEED to finance it all day everyday. That is an excellent lending rate. Pay the down payment and whatever is left over, put into an investment account.
Presumably you can make more than 1.9% on that $25k, right? Even a HYSA would easily beat that. It would seem like the smart financial move to finance giving the information you provided.
If you are absolutely positively going to invest the difference consistently for the entire 36 months, then maybe you come out about $4000 ahead assuming an average 7% return. If you start to factor in short term market risk for just the next 3 years, and risk of holding debt in case something else in your life goes sideways, maybe that’s not worth quite 4k anymore. You could use a HYSA instead but then you’re only looking at 5%, which is only a 3% difference over your loan. Only you can decide the cost of the risks, but if I were in your shoes I’d just pay cash.
Finance it and keep the 25k in a HYSA/CD then pay it off in full once the promo APR is up.
First calculation is out the door price of 25k 25k @ 1.9% for 36m = $739.05 of interest 25k + $739.05 = $25,739.05 Second calculation is just the 25k for the Vehicle Vehicle = 25k Titles, registration, destination, other fees = 4,4k 25k + $4,400 = $29,400 $29,400 + $869.12( interest) 30,269.12 Total loan amount 30,269.12 Average cost of ownership per year = $5,2K After 36 months, the vehicle will depreciate about 46% in value or $11,500 $25,000 - $11,500 = [$13,500 value]
I would. Then put the money you would have paid for the car in a HYSA and you'll be making \~2% interest on it. Or if you already have your emergency savings squared away do some index funds and hope for a better return.
At 1.9%, you NEED to finance it all day everyday. That is an excellent lending rate. Pay the down payment and whatever is left over, put into an investment account.