Free Cars – Car Loans

Here in Brazil as elsewhere, we take great care of our cars. Moreover, they are also as family members. Where else in the world do you find families that are going broke but have two cars in the garage?

The problem is us and our thinking. We are bombarded with the idea that we always need vehicular credit. And when our car already looks a little used, we rush to buy a new one and finance one of about $ 30,000. We all think: “We will always be able to finance a new car, this is normal. Search for the best car possible at the lowest possible price. ” Does that sound logical to you?

Being able to repay a car loan is a myth everyone believes.

Being able to repay a car loan is a myth everyone believes.

But the truth is that the “automotive fever” and this myth are destroying our financial future.

One study shows that a third of buyers make a purchase agreement of up to 6 years for a loan with an average rate of 9.6% per annum. And the value of these cars is about $ 26,000. That means a third of the cars you see on the street are dragging a payment of $ 495 a month.

And what the salesman does not say is that his new car loses up to 25% of the value when he leaves the dealership. After 4 years the car has lost about 70% of its initial value and there are still two years to pay off the debt.

That means that after six years you will have paid about $ 33,000 for your car that was worth $ 26,000 and is now worth about $ 6,000. Then this person suffering from the “automotive fever” will rush to make another financing of another new car and start all over again! And the payments will keep coming!

But what if we say “Enough”?

car loan with money cash

What if we keep the money instead of having to give the bank everything as payment? What if we make such a radical plan that money works for us and not for the bank?

In the example mentioned above, the amount of car payments is $ 495 per month, right?

Well, let’s think a little differently for a minute: Imagine you want a car that can have the monthly installments of $ 495 a month and the car you have is worth $ 1,500.
If you save $ 495 per month instead of having to send them to your bank as a payment, you will have $ 4,950 in just 10 months! And if you add the $ 1,500 car you have, you can buy a used car for $ 6,450.

That’s a tremendous high in car prices in 10 months, but you won’t pay the bank a dime!

Let’s go a little further: if you keep collecting this money, you will have another $ 4,950 in ten months. Maybe in less than a year you can sell the used car you bought for $ 6,450 for the same price you paid. Then you can buy a great used car for $ 11,400 in just 20 months. That’s very good, isn’t it?

Now let’s be radical again: here it’s been 20 months. You paid the car and you owe nothing to the bank and you still have a good car for $ 11,000 and no interest. Do you remember where you were 20 months ago? You were about to do another car finance, paying $ 495 a month for six years. And again you would be getting another debt!

Suppose you make this plan for the full 6 years: paying this $ 495 to yourself. Depositing in an investment fund during the 72 months and what would happen? After 6 years you would be finishing paying for the car you had funded and that now no longer looks as good as 6 years ago. Then you start looking and end up financing another car, thus returning to endless payments. Does that sound familiar?

But what about our plan?

money cash

After 6 years your car of $ 11,000.00 no longer gives. It was good, but the time has come to upgrade!

This is not a problem! You have an investment fund made especially to replace the car! Do you know how much you have in this fund? The interest on the stock exchange is 12% per year, so you would have $ 32,000.00.

Here is where everything gets really good: If you are going to buy a car for $ 12,000 in cash, you will still have $ 20,000 in your investment fund with a 12% annual gain. Do you know what that means? Even if you don’t deposit any extra money in this fund, you can still buy a $ 14,000 car every 5 years! Because the interest you earn on the investment fund will pay your cars for the rest of their lives!

This happens when money works for you. You never have to make any payments again! Do you know the value of the benefits of your car? Do you know what you could do without having to pay any car finance? Remember the $ 495 you would have to pay the bank for the financing of your new car?

If you invest that money each month

money loan

In a good investment fund, instead of having to pay the bank, in just ten years, it would be over $ 100,000. In 20 years, you will have almost $ 489,000.00. In 30 years, it will be like R $ 1.7 million and in 40 years, it would be R $ 5.8 million. Don’t you think with that money you could no longer retire? Of course it is!

I love the cars! But I have never seen one of $ 5.8 million Reais!

Only with a good decision can you literally change your life!

It’s possible to have free cars and still retire like a millionaire just by making a GOOD DECISION! So what are you waiting for? Try something different!

 

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