pinkapple Neutral Newbie March 3, 2020 Share March 3, 2020 What do you think? I have 2.28% with 60k left, FD is 1.7%, investment in funds can be 4-5% ↡ Advertisement Link to post Share on other sites More sharing options...
Philipkee Twincharged March 3, 2020 Share March 3, 2020 21 minutes ago, pinkapple said: What do you think? I have 2.28% with 60k left, FD is 1.7%, investment in funds can be 4-5% My dad used to teach me. Make sure u have money to pay up the car. But take a loan. Reason? In an emergency u need cash. A fully paid car might not easily be converted to cash. Or if u need to flee the country, no time to sell it off. So cash on hand is better. 9 3 Link to post Share on other sites More sharing options...
7Maoshine Neutral Newbie March 3, 2020 Share March 3, 2020 Agree with PhilipKee. You need funds for emergency use. Unless you got many $60k then it should alright. 😉 If not, just diversify to fd and funds, at least cover the interest payable hehe Link to post Share on other sites More sharing options...
Angcheek Hypersonic March 3, 2020 Share March 3, 2020 (edited) 1 hour ago, pinkapple said: What do you think? I have 2.28% with 60k left, FD is 1.7%, investment in funds can be 4-5% Is that you real pic .......... that smile is very Unique 😁 Depend on your cashflow ....... Investment in funds can be quite long duration and no guarantee . Pay off but make sure you have enough for rainy days ( maybe enough to stay alive for 2 yrs) Edited March 3, 2020 by Angcheek 5 1 Link to post Share on other sites More sharing options...
Vinceng Turbocharged March 3, 2020 Share March 3, 2020 The way moving forward for many is to max out the loan and live on borrowed money. You see those driving the big cars are more kiam kana. 1 1 Link to post Share on other sites More sharing options...
yishunite Turbocharged March 3, 2020 Share March 3, 2020 Because most car loan charge repayment fee and u have to pay some of the outstanding interest the actual return for early repayment is way worse than simply throwing it in a FD. The formula changes in the last 18 mths of the car loan when almost no financial product can match the interest savings on early repayment... Tldr: Dun repay car loan in first 5 yrs of 7 yr loan... anywhere else can earn better returns Last 1 yr if u got spare cash always pay off the loan Last 1-2 yr see how... depends on your risk appetite and how much the early repayment penalty is Ps. This message not vetted by MAS and isnt financial advice 🤣🤣🤣 1 Link to post Share on other sites More sharing options...
Newbie26 Hypersonic March 3, 2020 Share March 3, 2020 3 minutes ago, yishunite said: Because most car loan charge repayment fee and u have to pay some of the outstanding interest the actual return for early repayment is way worse than simply throwing it in a FD. The formula changes in the last 18 mths of the car loan when almost no financial product can match the interest savings on early repayment... Tldr: Dun repay car loan in first 5 yrs of 7 yr loan... anywhere else can earn better returns Last 1 yr if u got spare cash always pay off the loan Last 1-2 yr see how... depends on your risk appetite and how much the early repayment penalty is Ps. This message not vetted by MAS and isnt financial advice 🤣🤣🤣 Dont quite understand why last 18 months would be worse Generally its about cashflow. If no cashflow problem would just pay up in first year or asap because interest is compounded, a 2% interest is easily 5% for a 5 year 100k loan, 2.5% based on current formula early redemption incurs around 3k + penalty 2 Link to post Share on other sites More sharing options...
Angcheek Hypersonic March 3, 2020 Share March 3, 2020 U all so bad ... must use full cash one la. 3 3 Link to post Share on other sites More sharing options...
kobayashiGT Internal Moderator March 3, 2020 Share March 3, 2020 2 hours ago, pinkapple said: What do you think? I have 2.28% with 60k left, FD is 1.7%, investment in funds can be 4-5% 60% put in FD, 40% do investment. Link to post Share on other sites More sharing options...
yishunite Turbocharged March 3, 2020 Share March 3, 2020 27 minutes ago, Newbie26 said: Dont quite understand why last 18 months would be worse Generally its about cashflow. If no cashflow problem would just pay up in first year or asap because interest is compounded, a 2% interest is easily 5% for a 5 year 100k loan, 2.5% based on current formula early redemption incurs around 3k + penalty Base on opportunity cost. Where will ur balance remaining earn the most. Early days u have to sink a lot of cash for meager return. Towards the end u will use very little outlay to get high return in terms of percentage. Problem is ofcos that the total amount not much saved. But u wont be able to find any financial product that can give those returns at such low risk (technically negative risk since ur reducing ur own risk lol) Link to post Share on other sites More sharing options...
Mkl22 Twincharged March 3, 2020 Share March 3, 2020 46 minutes ago, yishunite said: Tldr: Dun repay car loan in first 5 yrs of 7 yr loan... anywhere else can earn better returns Hmmmm........ if it’s so easy to earn better returns elsewhere. Why is the bank wasting time lending money to you. 5 Link to post Share on other sites More sharing options...
yishunite Turbocharged March 3, 2020 Share March 3, 2020 Just now, Mkl22 said: Hmmmm........ if it’s so easy to earn better returns elsewhere. Why is the bank wasting time lending money to you. Read carefully. What u make from repaying the loan isnt what the bank makes from loaning u the money. Ur effective interest rate is something like 4.x% apr. If u early repay ull get effective 0.x% from your principal that has now disappear and cant be used elsewhere if repaying in the first two years after deducting all their fees. Go calc urself. We carrothead have to pay early repayment penalty and even some of the interest on the remaining loan tenure not to mention car loan calculate interest on the full principal every year of the loan (6 yr loan always better than 7 yr loan, almost no one will actually offer u 3-5 yr loans at those interest rates) Link to post Share on other sites More sharing options...
13177 Supersonic March 3, 2020 Share March 3, 2020 No need to pay off car loan de cause most people will change to another car within 4-5 years before the loan is clear. Lol. Link to post Share on other sites More sharing options...
Throttle2 Supersonic March 3, 2020 Share March 3, 2020 5 hours ago, pinkapple said: What do you think? I have 2.28% with 60k left, FD is 1.7%, investment in funds can be 4-5% How much cash you have? how well can you invest? Answer these yourself and you dont need to ask further. good luck 3 Link to post Share on other sites More sharing options...
Throttle2 Supersonic March 3, 2020 Share March 3, 2020 (edited) 3 hours ago, Mkl22 said: Hmmmm........ if it’s so easy to earn better returns elsewhere. Why is the bank wasting time lending money to you. I like the way you put it! 👍👍 And yet so many people think they can pull 5% rfr from the market. Edited March 3, 2020 by Throttle2 3 1 Link to post Share on other sites More sharing options...
Volvobrick Supersonic March 3, 2020 Share March 3, 2020 (edited) 3 hours ago, Mkl22 said: Hmmmm........ if it’s so easy to earn better returns elsewhere. Why is the bank wasting time lending money to you. Some time back some banks also thought like this and went on invest (or speculate) themselves .... And ended up bankrupt themselves! Edited March 3, 2020 by Volvobrick 3 2 Link to post Share on other sites More sharing options...
Angcheek Hypersonic March 3, 2020 Share March 3, 2020 3 hours ago, 13177 said: No need to pay off car loan de cause most people will change to another car within 4-5 years before the loan is clear. Lol. Waaa rollover is sibeh expensive 3 Link to post Share on other sites More sharing options...
Angcheek Hypersonic March 3, 2020 Share March 3, 2020 3 hours ago, Mkl22 said: Hmmmm........ if it’s so easy to earn better returns elsewhere. Why is the bank wasting time lending money to you. Bank earn by lending ... 😆 IMF give free money ↡ Advertisement 2 2 Link to post Share on other sites More sharing options...
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