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Paying off your truck?

Discussion in 'Ask An Owner Operator' started by karma123, Apr 5, 2015.

Page 1 of 11
  1. Apr 5, 2015 #1
    karma123

    karma123 Light Load Member

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    May 19, 2014
    California
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    Let's say that you're an owner operator, and have a brand new truck in which you make payments every month. If you had the opportunity to pay the truck off, will you pay it off? I mean completely pay it off! Do you guys think it's prudent? I think it would be smart.
    What are the cons and pros? Please don't judge and say I can't or no one can't pay a brand new truck off. Let's stay relevant to this post!
     
    karma123, Apr 5, 2015
    karma123, Apr 5, 2015
    #1
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  3. Apr 5, 2015 #2
    Steve62

    Steve62 Light Load Member

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    Mar 5, 2015
    Northern BC
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    Your truck payments are a write off 100% write off.
     
    Steve62, Apr 5, 2015
    Steve62, Apr 5, 2015
    #2
  4. Apr 5, 2015 #3
    HalpinUout

    HalpinUout Road Train Member

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    Oct 2, 2011
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    I'm not an O/O but how could it not be smart? Considering a new truck like you said it would be like lifting a piano off of your back... Definetley wouldn't have to work as hard...Not to mention your profit margin would go up....


    What would be ANY benefit of not paying it off? I cant think of any
     
    HalpinUout, Apr 5, 2015
    HalpinUout, Apr 5, 2015
    #3
    karma123 Thanks this.
  5. Apr 5, 2015 #4
    FatDaddy

    FatDaddy Road Train Member

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    Katy, TX or Swedesboro, NJ
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    I'm lost. Why would you choose to have debt if you can afford to have no debt?
     
    FatDaddy, Apr 5, 2015
    FatDaddy, Apr 5, 2015
    #4
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  7. Apr 5, 2015 #5
    karma123

    karma123 Light Load Member

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    May 19, 2014
    California
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    I was thinking the same thing. My uncle, who sold land in Nepal, has enough money to pay his brand new truck off. I envy him so much right know. He paid off his condo, and now he's contemplating about paying off his brand new truck. He has a Freightliner Evolution, so he's already thinking about buying a home with his new income. On the other hand, I am a struggling owner operator, I net about 4-5k a month. Well thanks for your feed back!
     
    karma123, Apr 5, 2015
    karma123, Apr 5, 2015
    #5
  8. Apr 5, 2015 #6
    double yellow

    double yellow Road Train Member

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    State of Jefferson
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    Why would someone not pay off their truck? Well, if they had an alternative use for that capital worth more than the interest they were paying.

    I used to be a "no debt" person, but today's interest rates are so low -- there is a lot you can do to earn more than 3% on your money. The key is to balance the upside against the risk and not put yourself in a position to lose everything if things slump for 5 years...

    I should add that I still am pretty much a no debt person -- I have clear titles to every vehicle. But I could see where leveraging could make sense (done wisely).

    Not in the US. Lease payments are tax deductible. Interest payments are tax deductible. But owned/financed trucks are either expensed or depreciated so you can't deduct the principal portion of your payment.
     
    double yellow, Apr 5, 2015
    double yellow, Apr 5, 2015
    #6
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  9. Apr 5, 2015 #7
    OOwannaBE

    OOwannaBE Medium Load Member

    575
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    Mar 12, 2015
    Nashville, TN
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    I pay off everything. My house will be paid off in 8 months. That is when I plan to buy my own truck. Because I have no bills other than utilities, insurance, and my cell phone bill.
     
    OOwannaBE, Apr 5, 2015
    OOwannaBE, Apr 5, 2015
    #7
    DrtyDiesel, Wild Murphy and Newtrucker48 Thank this.
  10. Apr 5, 2015 #8
    Pedigreed Bulldog

    Pedigreed Bulldog Road Train Member

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    May 7, 2011
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    No, they aren't. When you OWN the truck, you depreciate it. It doesn't matter if you pay over 3 years, 5 years, or buy it for cash and never have a note on it, it depreciates over the same length of time. Every so often, the government will set up a special temporary loophole designed to spur the economy by encouraging investment in business growth and allow equipment to be depreciated quicker, but generally speaking the IRS has timetables on how long various types of property hold value.

    The ONLY time your truck note is a 100% write off is if you don't really own it and are merely renting it...in which case it isn't YOUR truck because YOUR name isn't (and probably never will be) on the title.
     
    Pedigreed Bulldog, Apr 5, 2015
    Pedigreed Bulldog, Apr 5, 2015
    #8
    Ok big boy Thanks this.
  11. Apr 5, 2015 #9
    Clasix1055

    Clasix1055 Even when I'm wrong I'm right

    998
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    Jan 26, 2012
    Toledo, Ohio
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    If you only net 4k - 5k per MONTH ????????

    No need to be jealous sell your truck, buy a house and get a nice company job you will probably net more
     
    Clasix1055, Apr 5, 2015
    Clasix1055, Apr 5, 2015
    #9
  12. Apr 5, 2015 #10
    Newtrucker48

    Newtrucker48 Medium Load Member

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    Jun 8, 2012
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    I would always pay off debt no instance where keeping debt around is a viable and or smart business decision.
     
    Newtrucker48, Apr 5, 2015
    Newtrucker48, Apr 5, 2015
    #10
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