Calculating a car loan v. Savings account?

I have two options: To buy a car outright for $24,000 (thereby forfitting 5% interest on my money annually in a savings account) or buy the car for $23,000 if I go with the dealer financing on a 5-year loan at 6% annually. I have no idea how to calculate which is better for me! Please help if you can. Thanks.

Calculating a car loan v. Savings account?

It%26#039;s always best to pay for things in cash and not borrow money. If you have the money laying around, why bother with borrowing money? Too much risk associated with it.

Calculating a car loan v. Savings account?

Car Loan Guide: http://carloanguide.automobile... Report It

Calculating a car loan v. Savings account?

You have a third option, buy a car you can afford or (fourth option) save your money until you can afford the car you want.

Calculating a car loan v. Savings account?

Just buy it outright. You don%26#039;t want to pay for that car for 5 years. The hassle you save by not having to deal with the bills is worth whatever small if any amount you lose not having the money in the bank.

Calculating a car loan v. Savings account?

Why do you want to buy a freaking $24k car that will be worth only about $8k in 4 yrs? Dave Ramsey would tell you not to buy a car that expensive unless you (1) pay cash %26amp; (2) are a millionaire with money to burn. I can%26#039;t even imagine doing it when I do get to be a millionaire. I am a cheapskate. Spending $5k on a car is lavish around here. Btw, you can get much better returns on your money in decent mutual funds, even if you are not a stock guru. Just buy an inexpensive (under $10k) car %26amp; invest the other $14k, you will come out way better in the long-term. See the article below. I didn%26#039;t write it, but it is brilliant, anyway! :)

Calculating a car loan v. Savings account?

because your savings rate and loan rate are almost the same, it will be up to you to decide. If you do not want to freeze up your money, finance. If you pay up front now, you can start saving your money toward the next car(or something else you will need in the future). Third option is pay 50% upfront and finance only 50%. Also, when buying a car go for the car that holds value good. Buy a couple of year old used and keep it for a long time. Cars loose value quickly especially first 2-3 years. hope this helps!