How can FPV help you buy one of their vehicles

[GT-GTF]

Guaranteed trade in price would get my vote and guarantee FPV ongoing sales

[flappist]

Originally Posted by bfiipursuit

What do you mean??

a 2 year old FG GT with stripes / leather and less then 7,000 km isnt worth 50 kay?? At worse I would get 45 kay for it.

Go have a look at them on carsales!!

Every single vehicle on carsales has one thing in common, it hasn't been sold.

Dealer prices are set up to compensate for trade ins. You see a car for $50k and with no trade you will save a huge amount.

A 2 year old GT (2008 plate) with 0 km and 3 years warranty would have difficulty getting $50k and now coyote is here BOSS vehicles are going to nose dive in a big way just like windsor did in 2003 when BOSS came out e.g. When I bought my GT-P on 7 May 2003 a person I know bought a brand new TE50 a couple of days later for $45k from Metro. Thus is the nature of the industry.

[GT450]

Quite right Flappist and that's why they are still on Carsales. As they said in the movie The Castle " tell him he's dreamin".
Try privately selling your FPVs and you will do a little better but as a trade a lot of people on the forum need to get a grip on reality what dealers want to sell you one of these cars for and what they will trade them for are worlds apart these days but that's life today . Some here don't wnt to admit that.
Cheers
GT450

[Smoke Pursuit]

Originally Posted by flappist

Every single vehicle on carsales has one thing in common, it hasn't been sold.

Dealer prices are set up to compensate for trade ins. You see a car for $50k and with no trade you will save a huge amount.

A 2 year old GT (2008 plate) with 0 km and 3 years warranty would have difficulty getting $50k and now coyote is here BOSS vehicles are going to nose dive in a big way just like windsor did in 2003 when BOSS came out e.g. When I bought my GT-P on 7 May 2003 a person I know bought a brand new TE50 a couple of days later for $45k from Metro. Thus is the nature of the industry.

Why would a dealer put 45 kay trade on it then?? Bit hard to compare my situation to that of the AU T series verse the BA, totally different body shape!! This is only a motor upgrade, visually the cars the same minus stripes and its still got the same equipment level. Ive bought enough cars over the last 10 years to know what im doing.

Anyways you still havent said anything about discount interest rates verse cost price of the new car?? Whats the point of a discounted interest rate if your going to pay full retail for the car, the payment will be the same neway's. Manufacturers dont buy their money any cheaper then the rest of us!!

Oh and you do know the 12 months before first payment on the Navaras requires a 20% deposit don't you... Gotta read the fine print!

[mrbaxr6t]

I have only ever bought one new car that was an 09 plate focus XR5 what sours me on FPV offerings is why pay the massive money for the car to get crap after sales service, and then as others have said get ripped a new one in 3 years if you choose to sell, clearly this is why current owners dont "trade up" they simply cannot afford to cop a 50 odd kay loss in 3 years just to trade in and cop the loss in three years time all over thats 100 kay lost in 6 years possibly or therabouts not to mention the extra it cost you in interest, I won't buy a new FPV because I can buy two three year old ones with change, the value of them plummets way too fast for me. If I wanted this years' one I would look to buy it in 2014 let somebody else cop the value freefall.

[Poetic Justice]

Most of what you have referred to about dealerships/car salesman is a bit off bifiipursuit. I don't get paid a cent on financing.

The idea behind Toyota's 2.9% interest rate, for example, (which is limited to base Corolla Hatch and base Yaris hatch) is not to talk about the price of the car. It's to talk about how much you're budgeting to spend week in week out and whether we can achieve that. (Package also has up to 40% residual after four years available also.) This has already boosted sales big time on the vehicle and if anything, Toyota's profit margin will increase as a result.

But the most important end result, people are buying new cars they are happy with and can easily afford. It's a win win situation.

[Poetic Justice]

I think the guaranteed buy back thing is what would seal my old man. I don't purchase new cars as I get a company car, but my old man has owned many Fords (mostly v8 Fairmonts, XR's and now a BF F6).

If he knew he could walk in tomorrow and negotiate a deal on an FPV that would see him not do his dollar in 3-5 years time, he'd sign straight up. Sure there's a little negotiating on the price because it still has to work with his budget, but he'd sleep alot better knowing that when he would like to trade the car in and update to the newest FPV offering he'd be able to do so. It's guaranteed business and loyalty if you ask me!

[Smoke Pursuit]

Originally Posted by SCUD

Most of what you have referred to about dealerships/car salesman is a bit off bifiipursuit. I don't get paid a cent on financing.

The idea behind Toyota's 2.9% interest rate, for example, (which is limited to base Corolla Hatch and base Yaris hatch) is not to talk about the price of the car. It's to talk about how much you're budgeting to spend week in week out and whether we can achieve that. (Package also has up to 40% residual after four years available also.) This has already boosted sales big time on the vehicle and if anything, Toyota's profit margin will increase as a result.

But the most important end result, people are buying new cars they are happy with and can easily afford. It's a win win situation.

Thats exactly what im saying.

And yes the dealership does get paid on the finance deals they do, either via commission or rebates on their floor plan..

[geckoGT]

Originally Posted by bfiipursuit

FPV GT's hold their value better then most cars for the same value new, especially if you buy them at the right money.. I paid 58 kay for mine 2 years ago and have been offered 45 kay trade in, if i was to sell privately id get 51 - 52 thats only 3 kay a year in depreciation...

I see your point Brent but you need to remember that we do not all work within the industry and get the prices that you do. You bought your new GT at $58k on road, most of us can not get that price, particularly on a new model that dealers/FPV are very tight with discounts. When you are looking at buy back prices and changeover, yo need to keep it constant, your depreciation is actually $6500 per year.

We lost $28k in 3 years on the GT and $35k in 3.5 years on the SP, so our depreciation is more like $10k per year.

I am sorry, FPV's do not hold their value well at all.

[4Vman]

Originally Posted by geckoGT

I see your point Brent but you need to remember that we do not all work within the industry and get the prices that you do. You bought your new GT at $58k on road, most of us can not get that price, particularly on a new model that dealers/FPV are very tight with discounts. When you are looking at buy back prices and changeover, yo need to keep it constant, your depreciation is actually $6500 per year.

We lost $28k in 3 years on the GT and $35k in 3.5 years on the SP, so our depreciation is more like $10k per year.

I am sorry, FPV's do not hold their value well at all.

The dealers work on about $1000 a month depreciation on FPV's...

[Smoke Pursuit]

Originally Posted by geckoGT

I see your point Brent but you need to remember that we do not all work within the industry and get the prices that you do. You bought your new GT at $58k on road, most of us can not get that price, particularly on a new model that dealers/FPV are very tight with discounts. When you are looking at buy back prices and changeover, yo need to keep it constant, your depreciation is actually $6500 per year.

We lost $28k in 3 years on the GT and $35k in 3.5 years on the SP, so our depreciation is more like $10k per year.

I am sorry, FPV's do not hold their value well at all.

But in the case of your GT..

If you bought a similiar Mercedes or Bemma pricewise would you acheieve much more back. For memory the GT had 100,000 kms on it, go buy a BMW 323 and pay 70,000 for it new, drive 100,000 kms in it and after 3.5 years whats it going to be worth? 30 - 35 kay?

I dont think FPV is anyworse then any other manufacturer, if we all wanted good resale we would go buy Toyota Hilux Turbo Diesels or LC200 TD V8's!! or we just wouldnt buy cars full stop!

[Poetic Justice]

Originally Posted by bfiipursuit

Thats exactly what im saying.

And yes the dealership does get paid on the finance deals they do, either via commission or rebates on their floor plan..

Unless you are an integral part of the business (management, etc) the average sales person wants the deal. Wants THEIR commission - they wouldn't give two shits about whether the company benefits it.

Having said that, I don't approach it that way but such is my experience with people in this industry.

[Poetic Justice]

Originally Posted by bfiipursuit

I dont think FPV is anyworse then any other manufacturer, if we all wanted good resale would go buy Toyota Hilux Turbo Diesels or LC200 TD V8's!! or we just wouldnt buy cars full stop!

Quoted for truth

</toyotasalesman>

[geckoGT]

Originally Posted by bfiipursuit

But in the case of your GT..

If you bought a similiar Mercedes or Bemma pricewise would you acheieve much more back. For memory the GT had 100,000 kms on it, go buy a BMW 323 and pay 70,000 for it new, drive 100,000 kms in it and after 3.5 years whats it going to be worth? 30 - 35 kay?

I dont think FPV is anyworse then any other manufacturer, if we all wanted good resale would go buy Toyota Hilux Turbo Diesels or LC200 TD V8's!! or we just wouldnt buy cars full stop!

You are right, the BMW is no better, but then I would not buy a new BMW either. The Mini on the other hand, was bought for $45k and on trade in now (3 years on) we would easily get $25-30k. That is considerably better than the FPV's. In the early days of Mini's, they went through a time period when a second hand Mini cost more than its new buy price because BPM could not keep up with the demand.

To be honest, I think I will do what the old boy does, wait 3 years and then buy good second hand luxury cars for XR6 prices. He now has a Mercedes E350 and previously had a BMW 540. When he traded the BMW after 3 years he only lost $12k on it. Any car has the bulk of the depreciation in the first 3 years, after that it slows drastically. For proof, look at a XR6, $35k to buy and you would probably get about $15k on trade 3 years later. That is a loss of about $20k, if it kept depreciating at a linear rate, in the next 3 years it would be free (but they aren't).

I never actually said FPV was worse than other manufacturers, in some cases they are marginally better (not a lot). I just have no wish to throw away 10-15% of my personal annual income each year on car depreciation. What would that 10-15% of my income on my home loan each year do to my final interest cost and duration of mortgage?

Unfortunately, that is what all manufacturers are up against, people are getting a bit tighter on the depreciating assets (that is all a car ever is).

By the way, the GT was a bit higher as it went private sale, trade in was $4k less.

[flappist]

Originally Posted by bfiipursuit

Why would a dealer put 45 kay trade on it then?? Bit hard to compare my situation to that of the AU T series verse the BA, totally different body shape!! This is only a motor upgrade, visually the cars the same minus stripes and its still got the same equipment level. Ive bought enough cars over the last 10 years to know what im doing.

Anyways you still havent said anything about discount interest rates verse cost price of the new car?? Whats the point of a discounted interest rate if your going to pay full retail for the car, the payment will be the same neway's. Manufacturers dont buy their money any cheaper then the rest of us!!

Oh and you do know the 12 months before first payment on the Navaras requires a 20% deposit don't you... Gotta read the fine print!

Yes I do know about the fine print but you are missing the big picture completely.

It is NOT about the final cost of the vehicle it is about how it affects your financial situation in an ongoing basis.

But as you seem to be good at buying new cars I will retort that I bought my first new falcon with my own money in 1977, an XC panelvan and have bought quite a few since.
But buying cars does not give you insite into how the system works any more than driving them gives you insite into how the engine works.

My information is based on my working within many motor vehicle dealerships on an almost daily basis. This is not doing finance quotes but actually INSIDE their systems including the online auction systems so I have a very good first hand idea of what goes on.

Do you really think I would write something on here without checking my facts first?

Right now anyone can get into a BRAND NEW 2010 plate GT with auto, leather and stripes and 3 years warranty for $57k drive away so if you can get $52k for a 2 year old secondhand car with 1 year of warranty the go for it.

Why would they offer you $45k trade?

Maybe they needed to sell one more to make their quota?
Maybe they had a buyer who wanted that exact colour/combination and had $47k to spend?
Maybe they were desparate to get rid of whatever you wanted to buy?
Maybe they were being nice to you because of you family business connections?

If you actually do have any direct experience with the motor industry you would be well aware that bonuses, holdback and quota make a huge difference to the eventual cost of vehicles.

e.g. If hypothetically you sell 20 in the month you get an extra $3k per vehicle.
You have sold 19 and there are 3 days to go. If you sell 1 more you will get an extra $57k in holdback so it is in your interest to offer $45k trade for a $35k car in the hope that the wood duck thinks they are getting such a good deal that they buy something they can't afford and really don't need.

This is why the best deals always happen on the last day of the month and/or last day of the quarter.

[Smoke Pursuit]

Originally Posted by flappist

Yes I do know about the fine print but you are missing the big picture completely.

It is NOT about the final cost of the vehicle it is about how it affects your financial situation in an ongoing basis.

But as you seem to be good at buying new cars I will retort that I bought my first new falcon with my own money in 1977, an XC panelvan and have bought quite a few since.
But buying cars does not give you insite into how the system works any more than driving them gives you insite into how the engine works.

My information is based on my working within many motor vehicle dealerships on an almost daily basis. This is not doing finance quotes but actually INSIDE their systems including the online auction systems so I have a very good first hand idea of what goes on.

Do you really think I would write something on here without checking my facts first?

Right now anyone can get into a BRAND NEW 2010 plate GT with auto, leather and stripes and 3 years warranty for $57k drive away so if you can get $52k for a 2 year old secondhand car with 1 year of warranty the go for it.

Why would they offer you $45k trade?

Maybe they needed to sell one more to make their quota?
Maybe they had a buyer who wanted that exact colour/combination and had $47k to spend?
Maybe they were desparate to get rid of whatever you wanted to buy?
Maybe they were being nice to you because of you family business connections?

If you actually do have any direct experience with the motor industry you would be well aware that bonuses, holdback and quota make a huge difference to the eventual cost of vehicles.

e.g. If hypothetically you sell 20 in the month you get an extra $3k per vehicle.
You have sold 19 and there are 3 days to go. If you sell 1 more you will get an extra $57k in holdback so it is in your interest to offer $45k trade for a $35k car in the hope that the wood duck thinks they are getting such a good deal that they buy something they can't afford and really don't need.

This is why the best deals always happen on the last day of the month and/or last day of the quarter.

Pfft now your changing direction... I have spoken of bonuses and holdback in some of my other posts, I do have a fair understanding of the industry in particular to how floor plans work and manufacture incentive schemes, thats why I have pulled you up.

You are suggesting that FPV can help people potentially buy their car, thru giving them discounted finance rates etc. The truth is however they aren't helping the consumer at all, all they are doing is robbing Paul to pay Peter through charging retail prices for the goods and giving the customer a cheap interest rate which covers the difference of 4% of interest typically. What's that acheiving?? Nothing, the customer still ends up paying the same (or potentially more) monthy payment, but because the interest rate is 2.9% it must be a great deal!

For example if i do a lease quote on a G6ET for 60 kay at 4 % and one at 8% the difference is roughly $6400 in interest over the 5 years... So instead of paying paying $52,000 for the G6ET with bonuses and incentives you pay $60,000 costing you an extra $8000 for the car, saving $6400 roughly in interest.. What the better deal?

Originally Posted by flappist

The datto deal has made me consider it as the GFC is still here and a 12 month relief on my cash flow is something that appeals to me.

The part that makes me scratch my head is that you suggest buying another Nissan will benefit your cash flow thru no repayments till 2012 but you made no comment of the 20% upfront, how does that help your cash flow?? Id rather pay 12 monthly installments rather then 20% upfront just so I could live repayment free for a year, thats the whole idea of cash flow.

While your theories are good nothing is free, I think thats the biggest issue I perceive with most of these marketing tools you speak of, because thats all they are, they aren't good value for the customer. Toyota and Lexus are the kings of it, and its usually on old plate / runout cars that they can't shift or cars they want to sell at retail.

[IDT]

Price Price Price

[Crazy Dazz]

Originally Posted by geckoGT

I see your point Brent but you need to remember that we do not all work within the industry and get the prices that you do. You bought your new GT at $58k on road, most of us can not get that price, particularly on a new model that dealers/FPV are very tight with discounts. When you are looking at buy back prices and changeover, yo need to keep it constant, your depreciation is actually $6500 per year.

We lost $28k in 3 years on the GT and $35k in 3.5 years on the SP, so our depreciation is more like $10k per year.

I am sorry, FPV's do not hold their value well at all.

ALL Cars Depreciate. You WILL lose money on all cars, until they are depreciated down to almost nothing.
The more you pay, the more you lose.
Furthermore, the money you pay for stamp duty and dealer profit is gone the instant you drive away, and it’s apparent that some dealers are ripping FPV buyers off big time. Nobody in their right mind should have paid anywhere near full list price over the past couple of years.
I think FPVs were also hit hard by the GFC (as was mine) with a lot of people being forced to sell.
It also hasn’t helped that they keep obsoleting them. Naturally that will always happen, but I think there has been a disproportionate impact over the past few years.

I think where many people get severely disappointed is that they expect a short term reward for their devotion. They buy a GT, lock it in the garage, take it out only on Club days, and then get ****ed when it STILL drops 40% of its value in 2 years. Unfortunately a 2 year old “mint condition” GT is just not rare, it’s just a two year old that will obviously be worth a lot less than a brand spanker.
People need to realise that there will probably NEVER be another car equivalent to the GTHO…
By all means, keep your GT “mint.” If Ford soon abandons performance cars again, then your car may eventually begin to appreciate, and maybe in twenty years it will be worth something…
In the meantime, cars depreciate. Get over it.

That’s one reason I always finance new cars. I look at the repayment as an operating expense. Then when I get rid of the car, if it is worth more than the loan balance, it is a bonus.

[flappist]

Originally Posted by bfiipursuit

Pfft now your changing direction... I have spoken of bonuses and holdback in some of my other posts, I do have a fair understanding of the industry in particular to how floor plans work and manufacture incentive schemes, thats why I have pulled you up.

You are suggesting that FPV can help people potentially buy their car, thru giving them discounted finance rates etc. The truth is however they aren't helping the consumer at all, all they are doing is robbing Paul to pay Peter through charging retail prices for the goods and giving the customer a cheap interest rate which covers the difference of 4% of interest typically. What's that acheiving?? Nothing, the customer still ends up paying the same (or potentially more) monthy payment, but because the interest rate is 2.9% it must be a great deal!

For example if i do a lease quote on a G6ET for 60 kay at 4 % and one at 8% the difference is roughly $6400 in interest over the 5 years... So instead of paying paying $52,000 for the G6ET with bonuses and incentives you pay $60,000 costing you an extra $8000 for the car, saving $6400 roughly in interest.. What the better deal?

The part that makes me scratch my head is that you suggest buying another Nissan will benefit your cash flow thru no repayments till 2012 but you made no comment of the 20% upfront, how does that help your cash flow?? Id rather pay 12 monthly installments rather then 20% upfront just so I could live repayment free for a year, thats the whole idea of cash flow.

While your theories are good nothing is free, I think thats the biggest issue I perceive with most of these marketing tools you speak of, because thats all they are, they aren't good value for the customer. Toyota and Lexus are the kings of it, and its usually on old plate / runout cars that they can't shift or cars they want to sell at retail.

So the trade in of my current datto would not be more than $16k? It is not a FPV, it actually HAS fairly good resale value......

And as a PAYE employee I am very sure you would prefer monthly payments as your cash flow is assured and you get the same money on the same day every week regardless of what happens.

Are you seriously saying that even though you are employed in the finance industry you don't understand how, in the middle of this current recession when debtor accounts are extending further and further, deferring operating costs can assist in maintaining viability?

Seriously?

And you don't seem even remotely understand cash flow.

The difference between $1000 per month for 5 years ($60k) as opposed to $1500 per month for 36 months ($54k) is that if you can't afford $1500 per month and refuse to pay $60k THEN YOU CAN'T BUY THE VEHICLE.

Now, if because you have the vehicle you can earn an extra $200 per month then you will have earned over the 5 years an extra $12k and will be actually $6k better off rather than worse off.

[duaned]

How about you two go back on topic? It's getting boring in this thread with all this talk about finance! Lets talk about CARS!

[geckoGT]

Originally Posted by duaned

How about you two go back on topic? It's getting boring in this thread with all this talk about finance! Lets talk about CARS!

The financial side of things is one of the biggest elements determining if buyers are going to BUY a car so it is on topic.

[flappist]

Originally Posted by duaned

How about you two go back on topic? It's getting boring in this thread with all this talk about finance! Lets talk about CARS!

I spoke with the member who started the thread and asked if posting about finance options was on topic in a thread about methodologies to increase FPV sales including various finance options and the reply was that if I had actually read the whole thread I would not have had to ask the question......

The fact that over 70% of the poll was finance options might also be a bit of a hint.

[Smoke Pursuit]

Originally Posted by flappist

So the trade in of my current datto would not be more than $16k? It is not a FPV, it actually HAS fairly good resale value......

And as a PAYE employee I am very sure you would prefer monthly payments as your cash flow is assured and you get the same money on the same day every week regardless of what happens.

Are you seriously saying that even though you are employed in the finance industry you don't understand how, in the middle of this current recession when debtor accounts are extending further and further, deferring operating costs can assist in maintaining viability?

Seriously?

And you don't seem even remotely understand cash flow.

The difference between $1000 per month for 5 years ($60k) as opposed to $1500 per month for 36 months ($54k) is that if you can't afford $1500 per month and refuse to pay $60k THEN YOU CAN'T BUY THE VEHICLE.

Now, if because you have the vehicle you can earn an extra $200 per month then you will have earned over the 5 years an extra $12k and will be actually $6k better off rather than worse off.

Flappist, you're missing the point...

Im self employed myself so I know what it’s all about. Thanks for jumping to conclusions.

I’m not talking about you trading your old car in, your personal situation won't be the same as anyone else’s, what your saying is your going to use your current Datsun to cover the minimum deposit of 20%, have you thought that perhaps that cash would be better in the bank? For this exercise we are talking about how great Nissans offer is and the fact that you can get one with no payments till 2012. You say this is great for cash flow but what about the 20% upfront outlay?? What’s that do for cash flow? 60 kay car with 20% minimum deposit is $12,000 you have to pay to the dealer before you can drive it out the door, why bother financing at all if that’s good for cash flow, pay the whole $60,000 now and defer the operating costs altogether..

Explain to me how this $12,000 upfront payment is good for your cash flow today when you could pay $1,000 over the next 12 months and have that $12,000 in the bank?? Paying that to a dealer isn't maintaining viability, that’s outlaying $12,000 today you could spread over the next 12 months, maintaining cash in the business.

All I’m saying in this thread is that people need to know what they are getting into when they go for these sort of options that certain manufacturers offer, they are simply marketing tools, they use them to sell cars and usually benefit themselves, not to give customers a break.

[fmc351]

I dont know how you get past the notion a cash deposit of 20%, if more than the 1st years repayments, plus interest lost on that 20% sitting in an investment account, is less cashflow for the first year. If cashflow is an issue, Id hesitate a guess the individual sees it as more of an issue today, than in three years.

Cashflow isnt one thing, theres weekly, monthly, yearly and as long as you need to project for whatever purpose its being measured. Liquidity is going to be the main concern here. You can go bankrupt making a profit.

[GTENVY]

Voted low interest rate, only things stopping me buying one in the near future to be honest. its all about money money money lol

[flappist]

Originally Posted by bfiipursuit

Flappist, you're missing the point...

Im self employed myself so I know what it’s all about. Thanks for jumping to conclusions.

I’m not talking about you trading your old car in, your personal situation won't be the same as anyone else’s, what your saying is your going to use your current Datsun to cover the minimum deposit of 20%, have you thought that perhaps that cash would be better in the bank? For this exercise we are talking about how great Nissans offer is and the fact that you can get one with no payments till 2012. You say this is great for cash flow but what about the 20% upfront outlay?? What’s that do for cash flow? 60 kay car with 20% minimum deposit is $12,000 you have to pay to the dealer before you can drive it out the door, why bother financing at all if that’s good for cash flow, pay the whole $60,000 now and defer the operating costs altogether..

Explain to me how this $12,000 upfront payment is good for your cash flow today when you could pay $1,000 over the next 12 months and have that $12,000 in the bank?? Paying that to a dealer isn't maintaining viability, that’s outlaying $12,000 today you could spread over the next 12 months, maintaining cash in the business.

All I’m saying in this thread is that people need to know what they are getting into when they go for these sort of options that certain manufacturers offer, they are simply marketing tools, they use them to sell cars and usually benefit themselves, not to give customers a break.

Because you would only be paying interest on $48k not $60k.

As you are aware the first year is almost all interest and very little principle so you will be saving quite a bit won't you?

Apart from that to ensure you actually have the 12 x $1k payments in your plan you should put the money somewhere safe because if you use it and then can't get it back for whatever reason you have a BIG problem.
Nothing worse than owing a heap of money on a car that has been repossessed because you could not make payments......

So where do you put it?

Fixed deposit? Nup need part of it every month.
Savings? Yeh 1% interest if I am lucky as opposed to 9% on the usual finance plan (or 3.7% on Nissan but oops, I need the deposit for that)
In a shoebox under the bed?

[fmc351]

Originally Posted by flappist

Because you would only be paying interest on $48k not $60k.

As you are aware the first year is almost all interest and very little principle so you will be saving quite a bit won't you?

Apart from that to ensure you actually have the 12 x $1k payments in your plan you should put the money somewhere safe because if you use it and then can't get it back for whatever reason you have a BIG problem.
Nothing worse than owing a heap of money on a car that has been repossessed because you could not make payments......

So where do you put it?

Fixed deposit? Nup need part of it every month.
Savings? Yeh 1% interest if I am lucky as opposed to 9% on the usual finance plan (or 3.7% on Nissan but oops, I need the deposit for that)
In a shoebox under the bed?

The amount being discussed need not be the only money on hand, Id argue if $1k is hard to find, its not worth entertaining anyway.

Its simply an analysis of whats the best use of $12k. $12k deposit, invested in say a term deposit, is still yours to use tomorrow. You can pull some or all if needed (depends on the bank, you may have to pull all and sacrifice some interest), you cant do any of that if you slap it on the counter for a deposit. You could use a 90 day account and only need to find the $1k for 3 months while 12 is still earning interest and available if needed, or invest 10, and only need $333 a month. You can get 90 day term deposits paying over 5%, Heritage is paying 5.7, add in the 3.whatever you mentioned at Nissan and youre passing the interest costs of straight finance, but without the flexibility. As bf pointed out earlier, you cant simply compare the lower principle and the subsequent interest, without considering the lost revenue from interest lost.

Dropping $12k doesnt help with liquidity, which I think is the relevant definition of cashflow in this situation, especially if finding $1k a month is a daunting task.

He has a point.

[flappist]

Originally Posted by fmc351

The amount being discussed need not be the only money on hand, Id argue if $1k is hard to find, its not worth entertaining anyway.

Its simply an analysis of whats the best use of $12k. $12k deposit, invested in say a term deposit, is still yours to use tomorrow. You can pull some or all if needed (depends on the bank, you may have to pull all and sacrifice some interest), you cant do any of that if you slap it on the counter for a deposit. You could use a 90 day account and only need to find the $1k for 3 months while 12 is still earning interest and available if needed, or invest 10, and only need $333 a month. You can get 90 day term deposits paying over 5%, Heritage is paying 5.7, add in the 3.whatever you mentioned at Nissan and youre passing the interest costs of straight finance, but without the flexibility. As bf pointed out earlier, you cant simply compare the lower principle and the subsequent interest, without considering the lost revenue from interest lost.

Dropping $12k doesnt help with liquidity, which I think is the relevant definition of cashflow in this situation, especially if finding $1k a month is a daunting task.

He has a point.

Exactly my point, every scenario is different and only a fool would not consider every option and how it effects THEM rather than just assume that because something suits someone else it will suit you as well.

There is a huge difference between earning $104,000 a year in one lump sum at the end as opposed to $2,000 a week and if you are busy doing your job and do not have the time to inclination to do excess administrative paperwork then a simpler although more expensive solution may appeal.
Every hour you spend stuffing around sitting at a desk doing paperwork is an hour you are losing money because you are not doing your job, unless of course your job is sitting at a desk doing paperwork in which case I can see how it may be difficult to understand my point.

Ideally there should be no PAYG and everyone gets paid the full amount with the responsibility on them to have the money for their tax at the end of the year. That would work wouldn't it? You could stick all the tax in a short term deposit and make a profit. Or would that not work for some situations.

Interestingly enough interest rate is the number one on the poll and 12 months deferment is number three and between then they account for 70% of the votes so someone must consider them a good idea.

They may be right or they may be wrong but right or wrong are not relevant as purchasing of new vehicles is the goal.

[fmc351]

Id suggest getting a good accountant.

[Smoke Pursuit]

Originally Posted by fmc351

Id suggest getting a good accountant.

He doesn't need an accountant, he needs a Spin Dr.

Just joking Flappist.. But seriously mate if your going to use examples please disclose all information, not just some of it, because it can be very missleading.