Finance vs paying cash?

That's horrible. What kind of dealer or bank would charge a 20k interest finance cost???...weird.

 

The only problem with working like that is that you are paying say 10k in interest to the bank instead of sending uncle sam 3k in taxes. That kind of math just does not work for me. I want the extra 7k in my pocket.

 

I agree with your idea although I don't disagree with the other guy. $50k start up and a guy buys a $20k truck cash leaves him with $30k which to some is more than enough to start out. Or buy a $50k truck with $10k down and have $40k capital. I think if it's a guys first truck then he may need to start out with as much capital as possible because you can kill the interest by doubling up on the payments if I'm not mistaken.

 

yeah he is in kind of a bind but then I was looking at Lone Mountain yesterday. Don't know all the specifics but the 2016 5700 Western Star was like 12k down and 2600 a month for 60 months then it is yours. Not the way I would go for buying a truck but it is an option.

As for the earlier question about writing off the lease payments, that will all depend on how the lease is structured. If it is a straight up lease then yes you can. If you acquire portions of the asset then no you write off the interest and depreciate the asset.

 

It was Crete Carrier on the deal they offered. I think it was a 5 year loan. Crete always offered a very good interest rate. But over time it adds up.

 

But your missing the point. Why spend your working capital that you have on hand. 35 yrs doing it this way, everything I have is paid for. I like to play with expensive toys. Business side I use banks. Spend 7000 compared to using my 3000 is good business. It creates a good credit history. Can't have credit history if you use your own $$ all the time.

 

It is. That's from having a very good credit history. I can walk into my bank and ask for a certain amount and have it in 30 minutes and walk out. God help me if my banker ever retires!!

 

I agree with what you're saying as long as it's a great interest rate. I'm about to buy a newer truck (pu for personal use) and I'm getting 1.99% on that so yeah no brainer keep my money in the bank and use theirs. But for semi's I've been seeing no better than 8% offered. So I have been paying cash for those and I wouldn't say it has held me back one bit.

What interest rate have you been seeing for equipment?

 

Got to be honest LR, I think a LOT of us that have been around a while feel the same way, I am really getting tired of employees not doing their job, wanting more and more, all the while my equipment gets older and used up.

Sometimes I think if I liquidated everything I could live a pretty nice life with no worries. This isn't the first time I have felt this way over the years, but in the past you always "knew" that things would turn around again, today, I am just not so sure I am willing to make that bet, jmho.

 

Just for comparison Terry, the small balance I have left on equipment is at 5.9 percent, through my local bank, if I don't buy anything this year loan will be paid off by Jan. 1 2017.