When to retire the car?

I am totally on board with getting loans when you can actually afford them. "Afford" means something different to everyone, though. You're absolutely right that paying cash for *everything* will trash your credit score. I think you're on the right track with all of this. Best of luck!

 

How does paying cash for everything trash your credit score? I would think not paying would do that

 

Yeah, unfortunately, you do have to borrow to get a good credit rating. But that doesn't have to be car loans. We have a mortgage and then we buy everything we can on our credit card and then pay it in full every month. We have a couple other cards we use occasionally to keep them active and maintain a high available limit. Our credit score is extremely high. Haven't had a car loan since 1998 or 99.

 

Credit scores are based on credit history. If one has no credit history (no loans, mortgages, or credit cards), then that leads to low credit scores since one is viewed as unpredictable, and banks and insurance companies want people to be predictable. The longer one's favorable credit history, the more predictable one is assumed to be and the higher their credit score.

 

I've heard, and tend to agree, that his system is primarily aimed at people who make a decent amount of money but don't live within their means. Those people typically have a prior credit history, but it's bad due to bankruptcy, charge-offs, or late payments. If such people then decide to go to al all-cash system, their credit rating improves and they can get a mortgage. The problems with the system in that regard happen for people who follow his advice from the beginning and never get a credit rating. These folks, although they're very good at balancing their budgets, would not be able to get a mortgage.

 

I'm thinking having too many credit cards is just as bad as not having any. Imagine you have all this open credit available, can't be a good thing. Paying interest on possibly 20 cards would put you in some serious debt with no way out

 

(5) You just so happen to be located 20 minutes from the dealer auction that is selling a 2012 Plug In Prius that I want really bad but is too expensive for me at the moment. Go to auction (it is 20 minutes from Lancaster), test drive it, and if you like it I will buy it with dealers license and sell it to you for cost + $300. You are looking at approximately $7500, possibly a couple hundred more/less, out-the-door....Here are pics/info

FYI this will be the 3rd week it has ran....1st week he wanted $7500...2nd week $6800....and now 3rd week who knows maybe he will drop it to $6000....I am only mentioning this because I think it is a really good deal. People ask 2X that price when it has slightly less miles and is a non plug-in.

 

I think it's strange but true? Some years back I heard that people who pay off their credit card balance every month are referred to, by "insiders", as dead beats.

 

Its a bit funny but your household is like mine, to the extent that you have very nice cars sitting in the garage like Jay Leno's, and commute in older vehicles. But while you are paying interest on the auto loans, the cars are just accumulating dust and their value is depreciating anyway??

I made a decision a short while back that it was silly to pay big $$$ on a car just to have it sit in the garage and depreciate, so since I have the cars I am going to drive them all.

If I had to drive 124 miles round trip daily, I would go with your #1 or #2 choices, probably #2 to avoid further automobile loans.

 

Believe it or not, it is indeed possible to buy a home with no credit score, though it is a bit difficult. We paid our first home off in 2009, haven't had a car loan since 2006. By 2014 or so we had a credit score that couldn't be calculated because we had no history (we had done away with credit cards in 2006 as well). We decided to buy a bigger home in 2015 and had to jump through hoops to get a loan for it. We had to find a lender that was willing to do "manual underwriting". We had to show that we paid our utility bills on time, and had to have a revolving monthly payment on something. Believe it or not, having Netflix sufficed in that case. I would say for some, doing manual underwriting would be difficult. For us it was made easier by the fact that I have a fairly high income, no debt, and plenty of money saved (could've bought the house in cash if we really wanted to).

Since then, we have kept a small mortgage (did a 10 year loan) and given in to the idea of having a credit card and paying it off every month. Credit score is back over 800, so now the banks think we are "winning" now lol. One thing we didn't realize before was how much our insurance rates were affected by not having a credit score.

In my opinion, credit scores are a good indicator that you are responsible, and paying your bills on time. It is NOT a good indicator of wealth or really even money management. I know people with great credit scores, but debt up to their ears. Meanwhile, another person could be a Millionaire with no loans or credit cards and seem like a dead beat. Not fair, but it is the world we live in today.

 

Not when you are coming from a 450,000 mile prius. 150k isn't bad!

The one you saw wasn't a plug-in though? Just cannot be because I've looked in tons of different cities and the cheapest plug-in I've found from a private seller was $10,000 but with a salvage title.

To go to the auctions you need to be on the account of someone that owns a dealership. Very exciting place. The one in Pennsylvania is actually the largest one in the country I believe. They are running almost 7,000 cars today.

 

That may be possible, but on average, higher credit scores are positively correlated with age and higher income. It's rare for poor people in their 20s to have a good credit score, but very common for rich people in their 60s & 70s to have good credit.

 

My view is when repairs cost more than the car is worth, it's time to retire it.

That being said, putting money into it as a hobby, entertainment, or test is a different story.

 

I've ALWAYS been a "Dead Beat" LOL

 

Some auctions are indeed open to the general public, like the government auctions, see http://www.gsa.gov Also some smaller auctions like the one in Allentown, Pa. are only public auctions

 

Not to mention that there is no such thing as a 2011 Plug in Prius. They came out in 2012.

 

Just call me a "proud deadbeat."