I live in Indonesia and make $3,467/month ($41,604/year) after tax. I don't have a car, so I'm planning to buy a new $14,750 car before the end of the year because I have a wife and a baby now.
After all of my family expenses, I have $1,500/month laying around. I invest $1,000/month of that to $VT. Right now, I have $20,200 in $VT (I always reinvest the dividend). So each month I have $500 unused money.
Currently, I have $4,500 (not my emergency fund) that I'm planning to use as a down payment. I talked to a car dealer, and they came up with $365/month for 35 months. So $4,500 + $365 * 35 months for $14,750 car. This includes insurance and everything. Is this a good deal or not?
My plan is to either finance it like that, or sell half of my $VT shares ($10,250) and pay that car with cash. Honestly, I don't really want to sell my $VT shares. After thinking about its dividend, $20,000 yields around $488/year, which is pretty good compared to the car loan interest.
On the other hand, I also don't like having a debt, never even once. I don't have a debt, and also plan to buy a house next year.
What should I do here? Sell half of my $VT shares, or just finance the car for 35 months? Would love if someone can explain which one is the better option.
Thank you!
Submitted December 02, 2022 at 06:30AM by hacktober https://ift.tt/2NJZtiK
