Thats all I do too.
If I can't pay cash for it than I don't need it.

 

The parts I get through Trane, York, and Carrier, including RTU's, Condensing Units, and Furnaces are ALL financed as I have to wait for payments from the customer to clear. My 2 service vans are leased, and used. The office is leased also. The truck was bought for my personal use originally, but then started being used for nothing but work. It's now a work truck, and getting it's second oil change (15,000 miles) this morning. I am FAR from naive if you were directing your comment towards me. When I presented my business plan and projected growth model to Bank of America it went through immediately; at a time when they weren't lending to small business. I'm working 16+hr days, 6 days a week right now, (7 actually) and expect to for at LEAST another year until I grow a little more and get a full-time accountant and can increase the logistical side of my staff, including the hire of a Project Manager.

Bottom line is, had I known my truck was going to be used for nothing but work, I would have leased an XL. However, ALL of MY vehicles are paid for in cash. I don't like paying banks.

 

Very true...I hope you remember that as you get older because it will help you out greatly in the future.

 

Well for me its a matter of sitting down and projecting how much I'm going to mmake over the time of the loan. You can buy an older truck and tie your money up in repairs. I buy used myself but still have to finace. Over the past few years there has been some pretty steep tax deductions on trucks. 09 or 08 llet you deduct 100% of the price of the truck. No doubt you have to be smart about it.

 

Double posted

 

You and me both.

--

It's interesting how this got into a "I pay cash for everything".

Well, la-dee-da. My truck worked out like this:

My consulting firm leased my truck for me at around $600/month for 48 months. That's $28,800, without having to pay income taxes on it. That's like $19K after taxes. So if it was paid to me as salary, I would have gotten $19K in my pocket (assuming around 33% tax rate which is in the ballpark for New York + Federal ; there are other ways to get some of that back, but in terms of a W2 salary for me, it's 33%).

So, I have what I would have payed out, which is $19K, and $9K for the lease buyout. That's $28K.

Hmm... sticker price on my '01 F250 V10 was ... drum-roll please ... $32,145.

Value at lease start was, I think, $30K because of negotiations plus a warranty extension to 48 months.

Gee, I saved money by leasing it.

See how that works out FOR ME? Just like most of this thread, FOR ME it's perfect.

Either the V10 itself, or financing it, or a whole slew of other things.

Maybe it wouldn't work FOR YOU.

But I am happy with my decision

Most of this thread has been about not understanding what the other party finds important. It's interesting how the gassers have to repeatedly justify themselves, while (some) of the dieselers (here in this thread) can't see it - or won't on purpose?

Empathy is a dying art it seems.

 

Nope, they let you deduct the sales tax for your state or county based off of what you paid for the vehicle...What a joke.

 

Empathy is a trait, not an art. http://www.management-issues.com/200...lity-trait.asp

 

Aren't we supposed to be talking about football?
Or at least politics?

Cause my high school football team is 3-0 after moving up to division 4A, and we just beat last years division champs Friday night.

 

A person has to be able to differenciate between wants and needs.
Most every one wants the world and they want it now.

Dieing and owing a bank a couple of million has some poetic charm to it.

 

I know... sigh...

 

If it is something that I am buying for personal use, I don't buy it unless I have the cash to pay for it. For a business, I can understand where borrowing the money is beneficial. For instance, say you are starting a new company(geophysical logging company here, since that is what I have experience with) and you need 20 trucks. Even buying stripped down XL models you are still looking at $600,000 just for the trucks. To outfit each truck with the tools and mods it needs to work requires an additional $1,500,000 per truck. You now have $1,530,000 per truck, or a total of $30,600,000. Not many people have that kind of cash just sitting around the house. These trucks make, on average, about $10,000 per day, or $300,000 per month total. Payments on a $30 million dollar loan come out to $150,000 per month, which leaves a profit of $150,000 per month for the owner(before paying employees). Without the loan, you don't even get the business. With the loan you make a good living.

 

I'm glad I'm in the HVAC/R business...I'd be scared to have a 1.5 million dollar truck, let alone 20 of them.

 

The good part about it is that the most expensive parts on it are the logging tools. The radioactive tool alone is $1,000,000. Once the trucks wear out their only new expense is the truck itself. They just transfer the work station and all the tools over to the new truck.

 

To be honest I don't recall who I was commenting about and don't really care to look. In response to your response ( ), the short version is that everything you just said supports what I said which was that it's naive to think you are going to run a business and pay cash for everything you need.

About your truck, that's a different scenario. It's a personal item (was) and at least initially was not required for business. You can plan to buy a personal vehicle X years down the road and save for it. If you're lucky things work out and you can wait that long. In business you don't always have the luxury of time enough to save.

I'm glad your business plan worked out for you and the bank. Most people either don't want to or don't know how to put together a convincing business plan for a bank, but to be honest banks are not all that hard to convince if they are in the least bit interested in lending money. Most of them will have little to no clue about the business you are intending to start. They have no idea what it is that you will REALLY be doing, how that industry REALLY works, and what your odds of success or failure in that industry will be. They're just number crunches.

I've seen bankers handed some amazing snow jobs.