hdwrench

I cashed in my 401k from Nortel and bought a new Harley a few years ago... best thing i could have done as far as i am concerned. Lost 75% of all my other investements and Nortel went from $82 to $3. Live for the day is what i say... I'll be lucky to see retirement anyway.

Nazgul

Ditto, Crazyhorse! Using the 401k for this isn't a good idea. Not only are you blowing the chance to have that money build tax deferred for the next 40 years, but there are penalties for cashing it out.

Here you are getting all these good ideas from this site on how to save $250 by avoiding dealer rip-offs, but you might just be sending the IRS more than that in penalties for the early withdrawl.

My two cents worth. Hope you don't mind....

evolver

Depends on the status of your 401k I suppose, but in general it would be a very bad idea. On top of the standard Federal tax, they would charge you a penalty tax. After all that is totalled up, you might only be getting 70% of the total you have invested.

Now, if your employer has been matching a decent percentage on the contributions you've made, you COULD think of that as "money you wouldn't have had anyway" and let that absorb the tax penalty in your mind. What you end up with then is basically the same as a poorly performing savings account - you've put the money away but it didn't grow much (or any).

Also, do you see yourself possibly buying a house within the next few years? Under the "First Time Home Buyer's" rule you can withdraw from your 401k without any of the tax penalties (standard Fed still applies though). That's what I'm about to do. A house can be thought of as an investment which will grow in value. You can't say the same for a new car.

Then again, if you're 21 and this is your first major purchase, there's always the benefit of that hard-earned lesson: owing $15,000 on something that's only worth $10,000. You can tell someone it's a bad idea, but most people won't really understand until they're in that situation themselves.

hdwrench - the entire market took a hit a couple of years ago, so everyone was in that situation. Mine went down about 30%, but since then it's gained almost double what it lost.

dave 02 gt

Ditto, Crazyhorse! Using the 401k for this isn't a good idea. Not only are you blowing the chance to have that money build tax deferred for the next 40 years, but there are penalties for cashing it out.

Here you are getting all these good ideas from this site on how to save $250 by avoiding dealer rip-offs, but you might just be sending the IRS more than that in penalties for the early withdrawl.

My two cents worth. Hope you don't mind.... [/b][/quote]
do a 401k loan, (crazyhoorse & nazgul are right.)

dave 02 gt

ps. welcome an enjoy

dustindu4

Ugh I would never ever co-sign a car for my girlfriend. Did I mention we've been together 6 years and living together? She tried getting me to do it before and I flat out refused. No amount of "favors" could convince me otherwise.

My dad's mortgage broker buddy says he knows waaay too many people who tried to buy a house who were more than qualified, but they were denied because their ex girlfriend they co-signed for, had the car repossessed years before and they NEVER KNEW ABOUT IT. Why? Because they weren't together anymore and she could care less about his credit!

Lesson learned: don't co-sign for a girl unless you're married! Credit history is set in stone, you mess it up and you're screwed for the rest of your life. Don't let a dumb hoe ruin your life. Financial security is very important to me.

If a girl has bad credit, she has it for a reason. This should make it more obvious that hitting your head on a brick wall, that co-signing is a very bad idea. It will only come to haunt you. Now if you're married, she owns you 50% anyway so you really have nothing to lose. You will always be there to make sure the payments are sent on time.

To the original poster: If you can't afford the car don't buy it. If you have no credit there are other ways to build it. Get a credit card, use it and pay it on time. Get a cheaper car and pay off the loan. All that stuff looks good on your history. This is what I did. I'm 25 and my credit score is 780 and I'm pretty proud of it. If you have bad credit because of credit cards that you got stupid with, then the choice is clear. Don't live beyond your means. Buy a used car.

crawFord Mustang

Be sure to read this article: Edmunds Article It is about a guy that was a car dealer for a period of time. Talks about a lot of "tricks of the trade".

Also, anything on Edmunds would be useful when dealing with the dealer.

GhostTX

Gonna add my $0.02.

Don't cash in the 401k. The compounding interest and growth over the same 5 year period will far outmatch any additional contributions you hope to make over the time frame to make up for what you took out. Personally, it'd be better to suck it up and pay the additional $50/mth than take out the $1K+ in the 401k.

You'd also be much better off getting a parent to co-sign the loan. Its definately a much more stable person than any bf/gf. Until you are legally binded to someone (aka marriage/guardian), it is not a a good idea to have them co-sign.

Find a good Amortization program or Online Financial calculator to figure up you ideal montly payments.

CobraSVT302

well, not the WHOLE thing. just a little bit that i have invested into it just for the car. i know im gonna get taxed, but ill take care of that later.






thanks dad. [/b][/quote]
*In an equally fatherly voice*

Cashing in a 401K is probably not a good idea to use to purchase something like a car - which will start depreciating in value the second you drive it off a lot. Besides taxes - you may want to check first to if you are going to pay any penalties for an early cash out. It may not be worth it…

79cobra

ford.com has one on their site, so does kellybluebook.com
you can play with term, down payment and interest rate to see what the differences are.

kevinb120

that guy was an idiot :bang: Phillip the tool

gk_jam

You folks have a lot of great advice to give, and I also could use some guidance in this regard. I am starting research on buying a new car, and would love for it to be a Mustang V6. However, my situation is very unique. Here's the deal:

I don't live in the U.S., I will be moving to DC in October to start a job. I will need to purchase a car almost immediately. First of all, I have no credit in the US, and no foreseeable way to gain some by the time I'm ready to purchase. Also, as I am not currently working, I won't be able to place a down payment on the vehicle.

All this indicates a rather high monthly payment. I understand that, but I have no idea of ballpark figures. This is where I need help. Without exact pricing available, I am assuming to pay $17k-$18k for the actual car (base V6), with a financing period of 60 months. What I need to know is a ballpark figure of what kind of interest rate I will be able to finance at, given my background. I don't have any parents or siblings in the US, so I may have to sign alone for a loan.

Insurance rates will also be a consideration. I have no driving record, and will be over 25, but my US driver's licence will be obtained as soon as I arrive, only days before my planned purchase of the car. So I'll be a driver with a "new" record, but over 25 yrs old. Again, any idea of ballpark figures for insuring a car like the V6 Mustang for me?

It should be noted that I spent 5 years recently in the US as a foreign student, but I haven't really built any credit during that time. I don't know if this info makes a difference, just including it.

I really would appreciate any advice on this. I love the new Mustang, and would really like to own one! I know the monthly payments will likely be quite high, but i believe I will be able to afford something substantial. Just trying to do some prelim research so I am prepared in the Fall.

Decipher

In your situation I would hold off on the mustang, buy a cheaper car (read: used) and build up some credit. But that's just my take. Anyone else?

Galaxie

I agree.... buy a 8-9 year old car... drive it for a year, build up some credit, you can sell that car for about the same you paid for it. Then you can get the 'Stang

dustindu4

I'm going to be honest. With no credit history and no job, there's no way in heck you're going to get a loan for $20k. Buy a beater, get some credit cards and use them, not missing any payments. After a year or two you should be in good shape. Looks like it's '08 for you.

gk_jam

Well, though I have no credit history, when I apply for the loan I'll have quite a secure and well-paying job (I am moving for work), which is why I'll be able to afford high monthly payments.

But I understand your point, and will look into used alternatives.

Pony Style

[quote]Originally posted by It could be my first car@Mar. 23rd, 2004, 8:10 PM

Quote:

Originally Posted by jarradasay,Mar. 23rd, 2004, 5:55 PM

... v8 is too strong, too loud and... just too much.

I didn't think this was even possible?!?

I would suggest you do a little reading on how to negotiate a great deal. There are too many people out there that think they are getting a good deal for buying a car at MSRP, when in fact that is the price the dealer wants you to pay. If they are lucky, they sucker many with the sticker price or a few bucks under. I am extremely sick and weak these past few days, so I'm not going to post a long one with my experiences, but I will recommend some helpful web sites that will get you in the right direction in your deals...

http://www.carbuyingtips.com/

http://www.carbuyingtips.com/carintro.html

http://www.google.com/search?hl=en&ie=UTF-...&q=MSRP+invoice

Good Luck!

B

dustindu4

Credit bureaus don't care about that. What you have is good, you just need to build history with it. I'm not a credit counselor so I don't know exactly what you need to do to get your credit up there.

Stadifer

Just my 2 cents (as everyone covered everything about the car)... I would go through your local Credit Union and get pre-approved for the MSRP of the Mustang you want to get (Or at least the MSRP - Your Down). That way when you go to the dealer you can say I already have financing setup, we just need to take care of the pricing.

I've only purchased used cars to date... But everytime I go in the salesman (or manager) talk up their financing like there is no tomorrow. They often try to include that 0% financing as part of the price negotiations. Everytime I simply say that I already have financing and we can leave that out.

I also like knowing that my local Credit Union has my loan and I know that they will take care of me. Instead of my loan being owned by some bank on the other side of the country where it's going to be a pain in the hiney to get ahold of someone to help me with the loan, and/or having to make a payment on a weird date where plus the 5 days it takes to send the check to the bank holding my loan.

All my loans have been via my Credit Union and it is nice to walk in when I get paid and make my car payment while depositing my check. One car I had to re-finance and thanks to my Credit Union there where no hoops to jump through.

Stadifer

Sidenote on the 401k's.... All my retirements are handled via Mutual Funds, Roth IRA's, and Money Markets. I don't like the idea of my employer having so much control of my retirement.

So I take my after-tax dollars, stick them away, and won't have to worry about being taxed when I pull the cash during retirement.