Pay off car loan or not?

[Voodooman]

5 minutes ago, yishunite said:

Agree with the conclusion but the faulty assumption some ppl itt is making is what ur losing on the loan does not equate to what u earn paying it back. Secondly what u earn from paying it back is peanuts compare to what u gain from putting ur spare cash elsewhere except in the final 2 yrs of the loan

And btw i never see anyone offering 5 yr car loan anymore coz the advertise "interest rate" and effective interest are completely different base on tenure length and no one want to give u the low rates from 5 yrs and less. 6-7 yrs is only option

I am not aware there is a big difference between the 5 and 7 years given the very flat yield curve. 

[Enye]

wah...talk like investment bao jiak

now investment climate so bad...must have holding power

dont later paper loss cannot take it but still have a car loan to continue servicing hor

😖

[Throttle2]

2 hours ago, Enye said:

wah...talk like investment bao jiak

now investment climate so bad...must have holding power

dont later paper loss cannot take it but still have a car loan to continue servicing hor

😖

People who dont know anything about investments always think that it is baojiak

thats why you are Sifu, becos you know it is never bao jiak.

Thats why i am Sifu’s disciple becos i also know it is not bao jiak

[Throttle2]

10 hours ago, Jtbc said:

I will look at the investment return. If the return is more than loan interest then take the loan and use the money to invest else not. 

If put in FD at 1.7 Which is lower than 2.28,  Must as well pay/reduce loan amt. 

If investment return is 4 Which is greater than 2.28,  then go for investment. 

CPF is a secured deposit If you can / know how to make use of it. OA is 2.5 to 3.5.  which can use to pay housing loan. 

To put into context

car loan is not 2.28% pa only

effective rate is easily twice or 4.5%pa

Try finding a solid investment for 5%pa ......

not easy.... 

to put into context .....

muayhahaha.

[Beregond]

lets assume u got cash to make full payment. 

assume u have enough saving for emergency .

did u actually go count how different your car would cost. say for example a vezel. u pay full cash upfront 90k compare with u take loan for 5 years, 50% downpayment

i know a young couple, both teacher who cash payment for their vezel some years back. he say after he did his maths, why give the bank earn so much

[Throttle2]

5 minutes ago, Beregond said:

lets assume u got cash to make full payment. 

assume u have enough saving for emergency .

did u actually go count how different your car would cost. say for example a vezel. u pay full cash upfront 90k compare with u take loan for 5 years, 50% downpayment

i know a young couple, both teacher who cash payment for their vezel some years back. he say after he did his maths, why give the bank earn so much

 

Borrowing to cover an expense is the worst decision one can make.

if no choice then do it. 

[Jtbc]

14 minutes ago, Throttle2 said:

To put into context

car loan is not 2.28% pa only

effective rate is easily twice or 4.5%pa

Try finding a solid investment for 5%pa ......

not easy.... 

to put into context .....

muayhahaha.

Hi,  Pls advise how to calculate the effective rate of a car loan of 2.28%  for 5 years? 

Thanks. 

[Inlinefour]

with the current situation and economy

loan free

debt free

virus free

then you will

stress free

worry free

mind free 

my 2ml worth of Ron 92

take care all my fellow mcfers

heng

ong

huat

[Lala81]

If no repayment penalty, then just pay up cos car loans, u pay off interest first as opposed to normal housing loans.

Best full cash. If not then loan to minimum to get the required rebates etc.

With a 60k loan hanging around your neck, unless it's housing loan, should be avoided bah for mere mortals like us...

[Mkl22]

6 hours ago, Lala81 said:

If no repayment penalty, then just pay up cos car loans, u pay off interest first as opposed to normal housing loans.

Best full cash. If not then loan to minimum to get the required rebates etc.

With a 60k loan hanging around your neck, unless it's housing loan, should be avoided bah for mere mortals like us...

Agreed. 
Me also a peasant and have never encounter a finance rebate of 7k. Only buy bread and butter cars with at most 2-3k rebate if no loans are taken. 
probably the quantum must be pretty large for such a sizable rebate.  

[Throttle2]

7 hours ago, Lala81 said:

If no repayment penalty, then just pay up cos car loans, u pay off interest first as opposed to normal housing loans.

Best full cash. If not then loan to minimum to get the required rebates etc.

With a 60k loan hanging around your neck, unless it's housing loan, should be avoided bah for mere mortals like us...

Yes yes yes

[UncleAtas]

haizz.. see all here all full cash. my 2 seater sofa also need to take loan from Courts.

[Throttle2]

23 minutes ago, UncleAtas said:

haizz.. see all here all full cash. my 2 seater sofa also need to take loan from Courts.

Then please change your nick to a more appropriate one.  Heehee

[Karoon]

Parking here to see if got 5% investment lobang

[Arogab]

In life, I think you got to balance on what you know and what you have. Honestly, I made about what I have today which at that time, about over 15 years back. Back then, I was play up by my own relative whom I trusted and left them to start all over again almost declaring bankrupt. 

What you need is to spread your income into several areas that your are familiar to grow from there. If affordable, every loan counts, but one of the lowest is a car loan that is just 2.8% and you do not loan too much. 

I have investment in my area which I know gives me consistent returns but this also comes with certain risks. At the same time, I do have a saving plan with FD and Insurance policies which when I was below 30 and never consider it at all till I get married. Investment in property is also one basic and you need at least a house to stay. Consider this further along if you have the capability. 

One thing for sure is like for me, I know China stock market can be lucrative. But I never touch it cos I am not 100% comfortable with the risk and my expertise unknown(you may also here from people making a lot from there). My example of the only ''don't touch what is not familiar to you''. There can be more where you just do not want to go in. For example commodities, currencies or whatever you can name it.

As for car, I loan with an amount that I am able to pay over the expected depreciation such that when I go for the next car, I can take back what I came up with plus a little more after the depreciation. this means to me that I do not have to come up with more and more unless I go into another much more expensive car. I only came up with my own idea after all those years of fall down and re-plan everything in my life. 

Thus, go for whatever you know. I think Bro Throttle did mention something similar. Just that he put many words into few good sentences👍👍 (That is why he say he wipe tables😂 but wear so many lolexes)

[Throttle2]

2 hours ago, Karoon said:

Parking here to see if got 5% investment lobang

Have of course but investments returns are not guaranteed.

 

[Throttle2]

31 minutes ago, Arogab said:

In life, I think you got to balance on what you know and what you have. Honestly, I made about what I have today which at that time, about over 15 years back. Back then, I was play up by my own relative whom I trusted and left them to start all over again almost declaring bankrupt. 

What you need is to spread your income into several areas that your are familiar to grow from there. If affordable, every loan counts, but one of the lowest is a car loan that is just 2.8% and you do not loan too much. 

I have investment in my area which I know gives me consistent returns but this also comes with certain risks. At the same time, I do have a saving plan with FD and Insurance policies which when I was below 30 and never consider it at all till I get married. Investment in property is also one basic and you need at least a house to stay. Consider this further along if you have the capability. 

One thing for sure is like for me, I know China stock market can be lucrative. But I never touch it cos I am not 100% comfortable with the risk and my expertise unknown(you may also here from people making a lot from there). My example of the only ''don't touch what is not familiar to you''. There can be more where you just do not want to go in. For example commodities, currencies or whatever you can name it.

As for car, I loan with an amount that I am able to pay over the expected depreciation such that when I go for the next car, I can take back what I came up with plus a little more after the depreciation. this means to me that I do not have to come up with more and more unless I go into another much more expensive car. I only came up with my own idea after all those years of fall down and re-plan everything in my life. 

Thus, go for whatever you know. I think Bro Throttle did mention something similar. Just that he put many words into few good sentences👍👍 (That is why he say he wipe tables😂 but wear so many lolexes)

Bro, i very long no wipe tables already....

[Enye]

15% yield also have but high risk

is whether you dare bo?

😬🤣