hayleyearth Posted October 15, 2014 Share If the payments are within your means then go for it. We all finance cell phones so why not a bike. Really? Link to comment Share on other sites More sharing options...
Captain Fastbastard Mayhem Posted October 15, 2014 Share Really?Yep. Try getting out of a phone contract early. They nab you for the full outstanding value of the phone. It's a credit agreement with airtime and data values added to it, nothing more. Oh - and the same can be said of a car. It's a rapidly depreciating asset that should not be bought with cash. The same concept as buying a bike on credit. While I personally wouldn't do it (I don't need another bike) there's nothing wrong with it, and I would definitely consider it if I were to be looking for a new bike. Link to comment Share on other sites More sharing options...
hayleyearth Posted October 15, 2014 Share Yep. Try getting out of a phone contract early. They nab you for the full outstanding value of the phone. It's a credit agreement with airtime and data values added to it, nothing more. Oh - and the same can be said of a car. It's a rapidly depreciating asset that should not be bought with cash. The same concept as buying a bike on credit. While I personally wouldn't do it (I don't need another bike) there's nothing wrong with it, and I would definitely consider it if I were to be looking for a new bike. What I meant is....not EVERYONE has contracts, thus not EVERONE finance phones. HUH? You not making sense with the part in red! NOT AT ALL! Can not believe anyone will think that buying on credit is 'better'. It costs you more, full stop! (FYI I can still sell my car now for more than I paid for it because I bought it cash. Yes I got a good deal from the company, but if I didnt buy it cash it would have been another story by now because I would have had to add at least R40k onto that price with the interest and fees etc). I agree with the concept of having to save to buy something you want now might not make that product feasible by the time you can afford it, but if you have the cash (because you already saved it) then it is worth buying it cash now. Link to comment Share on other sites More sharing options...
Shebeen Posted October 15, 2014 Share 550 people and growing. that is not an insignificant figure...must have had a munga sized kitty to start with! Link to comment Share on other sites More sharing options...
Captain Fastbastard Mayhem Posted October 15, 2014 Share What I meant is....not EVERYONE has contracts, thus not EVERONE finance phones. HUH? You not making sense with the part in red! NOT AT ALL! Can not believe anyone will think that buying on credit is 'better'. It costs you more, full stop! (FYI I can still sell my car now for more than I paid for it because I bought it cash. Yes I got a good deal from the company, but if I didnt buy it cash it would have been another story by now because I would have had to add at least R40k onto that price with the interest and fees etc). I agree with the concept of having to save to buy something you want now might not make that product feasible by the time you can afford it, but if you have the cash (because you already saved it) then it is worth buying it cash now. You're in a very fortunate situation with your contacts. But on retail car purchases, unless you've got a shocking interest rate, it's better to pay a car off over 5 years than to buy it cash. Taking an average return of even 12% p/a on an investment (very achievable at minimal risk over 5 years) versus a finance cost of Prime (9.5%) you would be better off financing the car and investing the cash. Especially considering the value of the car in 5 years time. I've done the numbers on numerous occasions, and as long as you are smart with your money, and don't have a stratospheric interest rate on your finance agreements, then it's always better to buy the car on hire purchase. UNLESS you are in the position that you are in. That's an outlier of massive proportions. But - if you could finance it, it'd still be better for you to invest the cash and do a hire purchase agreement. Or unless you're "investing" in money market. Which you should only really do if you're parking the money for a short term (less than 6 months) The numbers don't lie... Link to comment Share on other sites More sharing options...
Vangar Posted October 15, 2014 Share What I meant is....not EVERYONE has contracts, thus not EVERONE finance phones. HUH? You not making sense with the part in red! NOT AT ALL! Can not believe anyone will think that buying on credit is 'better'. It costs you more, full stop! - Yes and no, unless you plan on keeping the car for ages treating it as a fixed expense just makes sense. Buying new doesn't make sense, car's are overpriced and lose too much value. (FYI I can still sell my car now for more than I paid for it because I bought it cash. Yes I got a good deal from the company, but if I didnt buy it cash it would have been another story by now because I would have had to add at least R40k onto that price with the interest and fees etc). - If it was new that must have been one helluva good deal since you lose a good 35% just driving it off the floor. Second hand maybe yes, I agree with the concept of having to save to buy something you want now might not make that product feasible by the time you can afford it, but if you have the cash (because you already saved it) then it is worth buying it cash now. - Unless having the cash on hand is more important. I'd rather have a steady line of credit with fixed repayments and have a good chunk of cash should I suddenly need it. Yes it cost's interest but thats fine, call it peace of mind fees. Link to comment Share on other sites More sharing options...
BuffsVintageBikes Posted October 15, 2014 Share 'Stru Let's face it, most people wouldn't think twice to finance a dirt bike for R100K which depreciates just as quickly as a bicycle so why should a bike be any different? As long as the commodity lasts you the length of your finance contract then I fail to see the problem with it. Gone are the days that a bike cost R1000 Link to comment Share on other sites More sharing options...
hayleyearth Posted October 15, 2014 Share You're in a very fortunate situation with your contacts. But on retail car purchases, unless you've got a shocking interest rate, it's better to pay a car off over 5 years than to buy it cash. Taking an average return of even 12% p/a on an investment (very achievable at minimal risk over 5 years) versus a finance cost of Prime (9.5%) you would be better off financing the car and investing the cash. Especially considering the value of the car in 5 years time. I've done the numbers on numerous occasions, and as long as you are smart with your money, and don't have a stratospheric interest rate on your finance agreements, then it's always better to buy the car on hire purchase. UNLESS you are in the position that you are in. That's an outlier of massive proportions. But - if you could finance it, it'd still be better for you to invest the cash and do a hire purchase agreement. Or unless you're "investing" in money market. Which you should only really do if you're parking the money for a short term (less than 6 months) The numbers don't lie... If you are REALLY about the numbers you should not keep your car for longer than 2 years/120000km (or how ever long the natural warrenty of the car is). 5 years is a big NO NO if you want to live a "low risk" life. Also very very few (if any) investment companies can guarantee you 12% interest at low risk investment options (which will incl all contributions made by investor) over 5 years with small investments (same as small car value = <R200k). Link to comment Share on other sites More sharing options...
Captain Fastbastard Mayhem Posted October 15, 2014 Share If you are REALLY about the numbers you should not keep your car for longer than 2 years/120000km (or how ever long the natural warrenty of the car is). 5 years is a big NO NO if you want to live a "low risk" life. Also very very few (if any) investment companies can guarantee you 12% interest at low risk investment options (which will incl all contributions made by investor) over 5 years with small investments (same as small car value = <R200k).No investment company will guarantee you 12%. but you can reasonably expect a return of 12% p/a over 5 years if you invest in the right funds and don't go for high risk funds - things lie Allan Gray Stable, Coronation Capital Plus etc. Guarantees cost money, and costs are detrimental to any sort of investment. As for only keeping a car for 2 years - debatable. Mine's a 2006 A4 that I bought 2nd hand 4 years, and financed over 5 years. The warranty is long gone, and I service it myself. I still claim depreciation against tax at a rate of 17.5% p/a, but I don't want to have a new car. If I did, and I had the cash and the option to buy with finance, I would do it with finance every time, unless my interest rate was at the level that finance becomes the less attractive option. As I said - the numbers don't lie. If you're looking at it versus a guaranteed investment, you'd be better off buying it cash. But then you shouldn't be looking at a guaranteed investment at your age anyway. Link to comment Share on other sites More sharing options...
Ramrod Posted October 16, 2014 Share So all the pragmatic and good advice aside, if the Rand dollar is going to continue to tank and real life inflation far higher than advertised CPI , is finacing this way not a interesting form of buying forward cover ? Pretty sure the price of any said bike will climb by more than 10% in a year. So buying now on credit may well be cheaper than saving and buying in two years !!! ( and riding a cheap bikes for two years , which looses its own value and cant be sold) I need to add , that I did not do this but I lurked on classifieds here for 24/7 for a few weeks and snapped up a bargain a few minutes after it being posted , that time was a GREAT investment !!So you mean i should have charged you more? lol glad you enjoying the bike Link to comment Share on other sites More sharing options...
Milosh Posted October 16, 2014 Share So you mean i should have charged you more? lol glad you enjoying the bikeYou could have [emoji6] but rest assured when a bike has a name she is being cherished .. Suzie - the smoking hot redhead !! Link to comment Share on other sites More sharing options...
StevieL Posted October 16, 2014 Share You could have [emoji6] but rest assured when a bike has a name she is being cherished .. Suzie - the smoking hot redhead !! Pictures please... Link to comment Share on other sites More sharing options...
Ramrod Posted October 16, 2014 Share Pictures please... Link to comment Share on other sites More sharing options...
hvh Posted February 19, 2015 Share CASH IS KING Link to comment Share on other sites More sharing options...
Dirt De Vil Posted February 19, 2015 Share Its not about the bike Link to comment Share on other sites More sharing options...
RDK Posted February 20, 2015 Share You're in a very fortunate situation with your contacts. But on retail car purchases, unless you've got a shocking interest rate, it's better to pay a car off over 5 years than to buy it cash. Taking an average return of even 12% p/a on an investment (very achievable at minimal risk over 5 years) versus a finance cost of Prime (9.5%) you would be better off financing the car and investing the cash. Especially considering the value of the car in 5 years time. I've done the numbers on numerous occasions, and as long as you are smart with your money, and don't have a stratospheric interest rate on your finance agreements, then it's always better to buy the car on hire purchase. UNLESS you are in the position that you are in. That's an outlier of massive proportions. But - if you could finance it, it'd still be better for you to invest the cash and do a hire purchase agreement. Or unless you're "investing" in money market. Which you should only really do if you're parking the money for a short term (less than 6 months) The numbers don't lie...You sir are correct this can be done, a guy that I know done this. He had cash to buy the car but instead financed the car with a residual as well and invested the cash. He made more money doing that and I couldnt believe it until he showed me his return on investment and all payments made on the car. So if I was in the position I would forsure also not buy a car cash, I never believed in giving deposit anyways. Link to comment Share on other sites More sharing options...
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