Finance or Outright ?

[hsfrank]

I never willingly accrue debt. Actually I am fortunate in that my only debt so far has been my first house and then only for a limited time. Recently I bought a set of Bose Quiet Comfort 15. They offered 6 or 12 equal payments charged to your credit card. I took that and imeadiately set up a transfer for a like amount from my savings account to the bank account where the credit card is on automatic debit.

[swiss ghost]

Originally Posted by Nav01L

Because you might feel some actual merit doing so...

And why would you want that to happen when you're really just aiming to communicate your wealth and status?

Ok, never mind, I'm getting slightly cynical here...

what does wealth and status have to do with financing?

all kinds of pro athletes who were once worth millions and now worth nothing thanks to 'financing' also known as 'pay later'

[alanc]

luxury timepieces are the poster children of discretionary purchases. My advice is, never finance discretionary purchases. Here's why -

First, while 0% financing seems free, it isn't. You can usually buy the same item for less if you pay cash, so you are out the price difference if you finance.

Second, even though you are theoretically paying no interest (see point 1 above - the price premium can be viewed as interest in disguaise), you are still commiting cash flow to a discretionary purchase during a period (the future) about which you know nothing and thus with respect to which you cannot know what you may need the cash flow for. Whatever the payments are, there may come a time when you need them for something else, notwithstanding the fact you can spare them now.

Save up and buy what you want from a trusted seller here (even BNIB can be found), save some money and don't lock up future cash flow.

[alanc]

Originally Posted by Gary Busey

Again, anybody on this forum who is leasing a luxury car(and not being able to deduct it as an expense) has no say in this convo.

Also, even if you do have cash to pay for an audi or bmw, you cant really tell anyone not to finance a rolex. The second you drive that audi or bmw out of the lot, you just lost the equivalent of a sub.
There is something to be said about depreciating assets. Whats a 1998 bmw 328 worth? Lool
As far as im concerned, every purchase is a trade. And no matter what, a rolex is a good trade

My view is - if you have to finance the BMW (or other luxury make), you're buying too much car. Buy the Toyota (or a used BMW for the same amount if you must have a Bimmer) for cash.

Too many people finance purchases for stuff they don't need to impress people they don't even know. Yes, I know, nobody needs a Rolex while G-Shocks exist, but life is about pleasure and satisfaction of ownership. as well as necessity. The key, though, is buy only those luxuries you can pay cash for. A five-year old Rolex in like-new condition from a trusted seller here, is just as satisfying as a new one; more so, in fact, because you can add the pleasure of how savvy you were in saving a bunch of money.

[steveclocks]

Originally Posted by aksingh

I was raised to never borrow and always save and pay cash, also that way stops impulse buys so by the time you have the cash if you still want to buy you know you really want the watch. Of the five watches Ive bought in the last few years, havent felt like selling any yet.

Exactly my thing too man! I don't regrett a single watch I bought over the years. And when I don't have the money, I'll just don't buy.

[polarinda]

Originally Posted by Nav01L

The way things are going in this day and age, you'll never really know how you're gonna be doing tomorrow... And if, like so many people these days I found myself locked out of my office with a generic letter telling me my showing up there was no longer needed... Well, the last thing I'd want would be invoices from a jeweler's or the BMW leasing service...

Lets face it, over the course of a financing period, even Rolexes don't really keep their value that well... Just like cars... They are hence utterly useless to secure a debt.

Realty is the only "collateral" actually worthy of this name. And as we have seen in the states a few years ago... Even that can potentially slam one down the drain.

It is then, not a matter of should you or should you not finance... But rather a matter of how easily you get out of the engagement if it all goes bad...

For this reason, all my watches are paid for... as is my BMW.

The only monthly payments I make are rent, health insurance, telephone and taxes.

That way... If that troublesome day that so many have met in recent years ever came in my life... I could start at zero, rather than at minus "fill in any number you can come up with here". And I like that feeling.

True. But the cash you used to purchase the watches and bmw could start you at above zero rather than at zero if you'd saved the cash instead.
Cash spent is money not saved. Paying it outright means nothing.
When u want/need the sub, you still pay $x whether you finance it or pay outright. The difference is only interests.
Maybe the only people suitable to buy a luxury item are people with a few million excess lying around doing nothing.

[Shikar]

A lot of justification going on in this thread.... :)

Regards

[Nav01L]

Originally Posted by polarinda

True. But the cash you used to purchase the watches and bmw could start you at above zero rather than at zero if you'd saved the cash instead.
Cash spent is money not saved. Paying it outright means nothing.
When u want/need the sub, you still pay $x whether you finance it or pay outright. The difference is only interests.
Maybe the only people suitable to buy a luxury item are people with a few million excess lying around doing nothing.

Well, nothing wrong with having a buck in the bank for a day worse than today... But I guess my point is, if you spend only what you have while you have it, you can get some enjoyment out of consumerism while still retaining the freedom of not owing anyone.

Whereas, if you start accumulating debt, some folks in black SUVs own your butt the day you can't pay.

By no means did I ever say that one should refrain from buying anything one likes, be it a watch or a car... It's all in the way of how one does it... Or how I do it, as you're free to live your life as you like.

[Nav01L]

Originally Posted by swiss ghost

what does wealth and status have to do with financing?

all kinds of pro athletes who were once worth millions and now worth nothing thanks to 'financing' also known as 'pay later'

Simple... If you bought a watch in order to feel like you really deserved it, you'd like to walk into the store with the pile of cash it takes to buy the watch in question...

If on the other hand you bought a watch just to flash it around in order to advertise your status (real or not, that's another story)... You'd be less concerned and well inclined to finance it.

My comment had thus no more than an ironic intent and did not in any way equate financing to having proper status.

As for celebrity athletes' bank accounts... I was of the opinion those remained mostly unbothered by the likes of Rolex, Audemars, Hublot and Richard Mille who are all more than happy to provide complementary watches to folks like Lionel, Michael, Rodger, Usain or that Blake dude from the Olympics...

The only thing those guys pay for is probably imported in a rather discrete manner by Dr Michele Ferrari...

;)

[outtatime]

Originally Posted by alanc

My view is - if you have to finance the BMW (or other luxury make), you're buying too much car. Buy the Toyota (or a used BMW for the same amount if you must have a Bimmer) for cash.

Too many people finance purchases for stuff they don't need to impress people they don't even know. Yes, I know, nobody needs a Rolex while G-Shocks exist, but life is about pleasure and satisfaction of ownership. as well as necessity. The key, though, is buy only those luxuries you can pay cash for. A five-year old Rolex in like-new condition from a trusted seller here, is just as satisfying as a new one; more so, in fact, because you can add the pleasure of how savvy you were in saving a bunch of money.

So the only people who should be allowed to buy a car are those who can pay cash?

How many people who buy a $20,000 Toyota have $20k in cash to spend on it?

Goodbye auto industry...

[mannyv11]

If you can play with someone elses money for free by all means I would say do it. Also with the way rolex is acting lately with the introduction of their boutiques and jewelers losing AD status, it doesn't look great for discounts even if you are paying in cash.

Also another thought if you can finance the watch for 18 months at 0% why not do it, I can almost guarantee that there will be a price increase in that amount of time. Someone recently posted that rolex bumps up the price an average of 8% on increases. So just by financing it and wearing it on your wrist in the long run you have the potential of saving yourself 8%.

Also I have financed large purchases in the past, but only if I have enough funds to pay off the entire loan if I had to. It is just a safe thing that I have learned over the years. All and all in my eyes there is nothing wrong with financing a luxury item as long as you can afford it and not put any strain on any of your other responsibilities. If the only way you could afford the luxury item is with financing I would be very careful in those waters because if something happens to you or your job you could be in a lot of trouble.

All and all you only live once and enjoy it, if you want a watch and you think you deserve it by all means I am not the person to tell you how to spend your money or anyone else's.

=)

[jwe]

Have you considered a 0% credit card? There are some cards offering 0% for up to 18 months in the UK. That way you can purchase a 'used/unworn' model from a reputable dealer and save on the list price also.
I wouldn't take out any finance if I couldn't afford it though!!
If you can [U]comfortably[/U] make the interest free repayments then go for it.

[mrbill2mrbill2]

Zero % for 3 years. Be late on one payment and "watch" the interest accrue.

[Muhle]

Pay in full!

[jphj012]

For personal, try to have NO DEBT as possible. For business however, I don't mind borrowing as much money possible from the bank.

[btinl]

Watches are luxury items. They are not worth going into debt for. I only pay in full upfront.

[manus]

That's why real estate went wrong.

[Hammer]

I'm all for saving up for a watch, but if it's an interest free deal, and there's a chance the watch will go up in value by the time you're in a position to buy it outright, then it's a no brainer. IMO, anyway.

[~JJ]

I think you guys need to differentiate the person w/ 50-100k+ in the bank, liquid, who uses credit to their advantage from a guy who lives check to check who uses credit to buy an item that's unattainable. Also, I keep seeing... credit is for people who want to impress... seems like a short sighted generalization / assumption...IMO.

[43builder]

there are only two things you should borrow money on - a car (only if needed - otherwise pay cash) and a house

i personally would never finance on a luxury item. much better to have cash in hand!

[Gary Busey]

If history is any indication of the past, a Rolex should have a similar status as a home in terms of value.
A luxury item, almost 100% of the time, depreciates to 0 very quickly, and you usually have nothing to show for it except a memory and a smile:

-Gulp of caviar
-Bottle of Petrus
-Ferrari (i know, some models are collectibles and worth 10x more...not talking about those)
-Spa with 8 girls licking your body (ive never been, just heard of it)
-etc

exceptions:
-Diamonds (seems like supply control in this case has kept prices up)
-ROLEX! (doesnt seem to lose all that much value)
-Really collectible items (some cars, a few watches etc)

Seems to me we have some financial extremists in this group. The kind that say pay your house and everything before getting a Rolex, no debt, only cash, bla. Thats an exageration, and prevents many upper middle class from enjoying these ''luxuries'' before the age of 50 (sorry, wont be my case), even if they can now.
Granted, i respect that way of thinking, especially in todays Fiscal Cliff, apocalypic economy....but its also reflection of how wealthy (vs mean) the average Rolex owner is, and out of touch sometimes.

you buy a Camry, i buy a Fiesta, and a Rolex. There are sooo many other variables


-Gary B

[financeman]

Originally Posted by Gary Busey

If history is any indication of the past, a Rolex should have a similar status as a home in terms of value.
A luxury item, almost 100% of the time, depreciates to 0 very quickly, and you usually have nothing to show for it except a memory and a smile:

-Gulp of caviar
-Bottle of Petrus
-Ferrari (i know, some models are collectibles and worth 10x more...not talking about those)
-Spa with 8 girls licking your body (ive never been, just heard of it)
-etc

exceptions:
-Diamonds (seems like supply control in this case has kept prices up)
-ROLEX! (doesnt seem to lose all that much value)
-Really collectible items (some cars, a few watches etc)

Seems to me we have some financial extremists in this group. The kind that say pay your house and everything before getting a Rolex, no debt, only cash, bla. Thats an exageration, and prevents many upper middle class from enjoying these ''luxuries'' before the age of 50 (sorry, wont be my case), even if they can now.
Granted, i respect that way of thinking, especially in todays Fiscal Cliff, apocalypic economy....but its also reflection of how wealthy (vs mean) the average Rolex owner is, and out of touch sometimes.

you buy a Camry, i buy a Fiesta, and a Rolex. There are sooo many other variables


-Gary B

Well said

[Wllnv19]

Everyone is responsible for there own financial decisions and how they decide to spend or not spend their money. Life is to short, if you want a Rolex and chose to finance, then do so because no one knows what the future holds for any of us.

[slvrbulletv6]

In my situation, I purchased my watch after I waited to be debt free from school loans and attained career accomplishments. I did not want to purchase my watch until I felt it was deserved and financially relevant to my current socialeconomic status. I always paid my credit card (and other bills) in full. In my opinion, I would finance only if it saves me money instead of paying it in full outright (such as accruing rewards on the credit card) or if the cash can be used for other worthwhile opportunity costs, I have 30 days before the credit card bill is due so why not benefit from it. My next goals are to purchase my own home (instead of renting) and purchase a nice sports car to park in the garage (yes, in that order).

If people have other debt, but still continue to spend, that's how they want to live their lives. But I don't want to hear their complaints on how they're "broke" or have "nothing" and can't pay for this or that. Especially, those that expect others to pick up their tab at a get together... (Referring to some people that I know...and my posting just slightly went on an off tangent rant...=X).

[Stonedcl]

I purchased my 1st rolex by financing it and got a great deal.. I got about 15% off and 0% financing for a year and had it shipped so I saved on taxes.. With a rolex you really will not lose your shirt on a ss model.. By the time you pay it off it would have had a price increase so you are already up in my opinion.. If you do get into a jam then you will defiantly be able to sell it and pay it off if you need to especially with a model like a sub or Daytona..
While I was paying off my 1st rolex I was saving up for my second so right after I paid off my 1st rolex I paid cash for my 2nd..

[jpourteau]

Nothing like working for something... Don't finance

[polarinda]

Save up and buy that 500k house in cash too. You never know when the next economical tsunami is coming and it could jam you up worse than owning that sub under finance.

[Shikar]

Originally Posted by polarinda

Save up and buy that 500k house in cash too. You never know when the next economical tsunami is coming and it could jam you up worse than owning that sub under finance.

I actually agree, and do. Though it may have been said in jest above.
We all make our choices and live by them.

Regards.

[Reu]

BOOOO!!!!!!!!!!!!!!

Can someone please message me and let me know when this thread has either run out of mileage and comes to an overdue but natural end or one of the moderators puts it out of its misery!!

I contributed myself to this thread although after my last post I promised myself I wouldn't take a peek again. I logged on and saw it again today and I couldn't help it.

It just looks to me that there just isn't going to be an overall agreement.

Whether it's right or wrong, moral/ethical or not one thing I have noticed is that the posts from UK members seem pretty different to the US members. There you go - a new angle!!

Again I'd just like to say I am unbiased. Live and let live, as long as its not harming anyone else.

I truely have to get off here for a while. I just seem to feel compelled to open this thread up when I visit here haha.

[SeamasterGMT]

Had to jump in just to say...

I walked into an Audi dealer and said "I've got cash, can you give me a discount?" He first said "no, if you took finance, we get a kickback from the finance company so I could knock some off if you wanted to take it out". then he said "we can only accept ( can't remember exact amount but something like £10k) because of anti money laundering measures.

It could be worth it to take the finance on a car if it means getting a better deal - just make sure there is no early payment penalty.