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  • xraygoggles
    replied
    EntrepreneurMD, is this really all just elaborate, wordy fiction you are doling out in your responses, or are you for real?

    I can't fathom, for the life of me, why anyone would go to such great lengths on an anonymous forum? What possible benefit could there be to it?

    Just seems strange, that's all. Although I admit, I do like reading the back and forth between FLP and yourself.

    Back to the topic, I don't care for or want a supercar, but I did get a Tesla 3 recently, and couldn't be happier about the decision!

    Leave a comment:


  • EntrepreneurMD
    replied
    OP, glad you appreciate the feedback.

    So for over two decades now I have been

    1- Transferring debt to 0% no transfer fee credit cards and paying them off within the 12-18 months

    2- Leveraging untapped HELOCs as my emergency back up to earn income on my actual cash reserves

    3- Refi home for cash out

    4- Refi automobiles for the lowest possible borrowing rates

    5- More than triple our early professional career income post-residency

    6- Saving hundreds of thousands by couponing, comparison shopping, credit card cash back, Ebates, generic clothing, restraint, etc.

    It has worked out every time. How hard is it to borrow at 0 and invest in a guaranteed CD at 3% or into early bulls (ie. 2009)? One has to be pretty unintelligent to lose there and make me look like FLP's genius. Obviously there has to be some calculated risk for the rewards one reaps, with the operative word being calculated. Have faith in your business and investment skills thru continuing research and refinement. Nothing wrong with being leveraged, everything wrong with being overleveraged. Healthy income a back up for leverage, not just the invested asset. Leverage at 0-3% good, above that not so much. Currently leveraged credit cards, car, residence. Expanding income, investment equity and emergency funds plenty to insure risk. No problem. Don't want my talents to be limited to my role as physician. What great things do you feel you are capable of?

     

    Leave a comment:


  • fatlittlepig
    replied




    I did not mention a car. Nor did I mention YOUR investments. Borrowing on one asset (secured) and investing in another increases risk. In financial analysis, it’s call VAR. Value at Risk. Changes in one investment impact the other. My point is that it is usual prudent not to cross borrow from one asset to invest in another. More people are hurt by leverage than helped (no data, just an opinion.

    Leverage is rather simple. It can help or hurt you. Some extremely wealthy don’t bother with leverage.
    No need to boast or take offense.
    One can pay for an asset and keep stocks on margin, or finance an asset purchase. It makes zero difference except to the lender, what is the collateral put up?
    Leverage is the concept, not the dang car. It increase the VAR due to the loan. You seem to prefer debt. Your choice. You recognize it and thus keep high liquidity.
    Click to expand...


    Tim, it’s all smoke and mirrors. It was actually a fellow forum member who clued me in that it was a charade, and since then others have messaged me that it doesn’t add up.

    the multimillion dollar commercial real estate practice

    the investing in mutual funds that returns 30% a year x 10 years (that conveniently is not listed)

    the multiple supercars (he snickered at my Honda Civic, but declined to post a picture of his “Ferrari”)

    the rich friends and lavish lifestyle

    and now the claims that great wealth awaits those who pursue strategies which make absolutely no financial sense.

    I get it- anyone can claim anything on the internet, the only issue is this forum is supposed to cater to intelligent and coherent personal finance advice.

    Leave a comment:


  • Tim
    replied
    I did not mention a car. Nor did I mention YOUR investments. Borrowing on one asset (secured) and investing in another increases risk. In financial analysis, it’s call VAR. Value at Risk. Changes in one investment impact the other. My point is that it is usual prudent not to cross borrow from one asset to invest in another. More people are hurt by leverage than helped (no data, just an opinion.

    Leverage is rather simple. It can help or hurt you. Some extremely wealthy don’t bother with leverage.
    No need to boast or take offense.
    One can pay for an asset and keep stocks on margin, or finance an asset purchase. It makes zero difference except to the lender, what is the collateral put up?
    Leverage is the concept, not the dang car. It increase the VAR due to the loan. You seem to prefer debt. Your choice. You recognize it and thus keep high liquidity.

    Leave a comment:


  • fatlittlepig
    replied
    Borrowing money to purchase a (heavily) depreciating asset somehow leads to great wealth. We obviously are in the midst of a financial genius. LOL.

    Leave a comment:


  • I Find This Humerus
    replied




    Tim and OP,

    One thing the significantly wealthy do is they leverage their assets to become even more wealthy, while enjoying the asset – even a depreciating asset.

    I purchased my cars with cash, but have refinanced them when prudent on several occasions with sub 2% 6-year loans, for me up to $220K at a time. That kind of money can sprout a serious business. I have used these funds to further grow my business and real estate. In turn, I partially use the associated windfall to pay off the car loan.

    Then this process can be repeated indefinitely. Those depreciating assets over the decades can earn you hundreds of thousands, if not potentially millions. You can’t just think like a doctor or an attorney or a dentist or an accountant, it takes an entrepreneur to think out of the box.

    That is the only reason I have a current automobile loan obviously, with a $2M emergency fund and an auto loan interest rate lower than I get on the CD returns.

    This kind of leverage is one way (out of a plethora) the wealthy get wealthier with safe investments, and can help OP to leverage, over time, the final cost of supercar ownership while benefiting his business or diversifying into my favorite commercial real estate – for me, by doing this the car has paid for itself multiple times over. So for all the naysayers, my Ferrari has made me money, compared to their simple vehicle depreciation. In their stubbornness they can’t figure this out due to entrenched preconceptions.

    Yes I could have invested the $170K and not bothered with my passion for a supercar, but maybe some in the “crowd” want to actually live life and not be told their decisions are dumb for narcissistic disagreement on what others demand they must value versus their own intrinsic values.

    Tim, taking all my $13M and putting it in the markets simply for long term appreciation is not wise in the grand scheme of life, even if I will ultimately wind up ahead financially. Your definition of wise is simply not mine. So yes, I consider my Ferrari to be wise and simply adding to my $12M in appreciating assets to give up the enjoyment very, very unwise actually. Yes, I could have been a miser and not have purchased the cars or the big house. Is that the life you would consider wise? To quote Bette Midler, “It’s the soul afraid of dying that never learns to live.” Am I to live my entire life afraid to spend $150K here because it’s not “wise” financially? Would I look back at my life and say I lived it to the fullest? If you read my comments in this string, I recommended on one do it if they don’t expect to be a decamillionaire and have noted ownership is not for everyone.

    I don’t understand 95% of the advice coming from my 9 figure NW friends and neighbors until I research it in depth. It often conflicts with my understanding. I would never think of telling them their private jet is dumb, take a commercial flight. I gave up my preconceived notions a long time ago because I know my stubbornness and laziness to mimic success would be a major deterrent to achieving that success for myself. To each his own I guess. But some here have to give to each his own.

    OP did not ask if they should buy the car. Everyone should give OP the courtesy of answering the financing question posed. “Dumb” comments here are not a valuable perspective, rather a denial of our individuality.
    Click to expand...


    THIS is the kind of information I was looking for!

    Leave a comment:


  • EntrepreneurMD
    replied
    Tim and OP,

    One thing the significantly wealthy do is they leverage their assets to become even more wealthy, while enjoying the asset - even a depreciating asset.

    I purchased my cars with cash, but have refinanced them when prudent on several occasions with sub 2% 6-year loans, for me up to $220K at a time. That kind of money can sprout a serious business. I have used these funds to further grow my business and real estate. In turn, I partially use the associated windfall to pay off the car loan.

    Then this process can be repeated indefinitely. Those depreciating assets over the decades can earn you hundreds of thousands, if not potentially millions. You can't just think like a doctor or an attorney or a dentist or an accountant, it takes an entrepreneur to think out of the box.

    That is the only reason I have a current automobile loan obviously, with a $2M emergency fund and an auto loan interest rate lower than I get on the CD returns.

    This kind of leverage is one way (out of a plethora) the wealthy get wealthier with safe investments, and can help OP to leverage, over time, the final cost of supercar ownership while benefiting his business or diversifying into my favorite commercial real estate - for me, by doing this the car has paid for itself multiple times over. So for all the naysayers, my Ferrari has made me money, compared to their simple vehicle depreciation. In their stubbornness they can't figure this out due to entrenched preconceptions.

    Yes I could have invested the $170K and not bothered with my passion for a supercar, but maybe some in the "crowd" want to actually live life and not be told their decisions are dumb for narcissistic disagreement on what others demand they must value versus their own intrinsic values.

    Tim, taking all my $13M and putting it in the markets simply for long term appreciation is not wise in the grand scheme of life, even if I will ultimately wind up ahead financially. Your definition of wise is simply not mine. So yes, I consider my Ferrari to be wise and simply adding to my $12M in appreciating assets to give up the enjoyment very, very unwise actually. Yes, I could have been a miser and not have purchased the cars or the big house. Is that the life you would consider wise? To quote Bette Midler, "It's the soul afraid of dying that never learns to live." Am I to live my entire life afraid to spend $150K here because it's not "wise" financially? Would I look back at my life and say I lived it to the fullest? If you read my comments in this string, I recommended on one do it if they don't expect to be a decamillionaire and have noted ownership is not for everyone.

    I don't understand 95% of the advice coming from my 9 figure NW friends and neighbors until I research it in depth. It often conflicts with my understanding. I would never think of telling them their private jet is dumb, take a commercial flight. I gave up my preconceived notions a long time ago because I know my stubbornness and laziness to mimic success would be a major deterrent to achieving that success for myself. To each his own I guess. But some here have to give to each his own.

    OP did not ask if they should buy the car. Everyone should give OP the courtesy of answering the financing question posed. "Dumb" comments here are not a valuable perspective, rather a denial of our individuality.

    Leave a comment:


  • fatlittlepig
    replied




    Not everyone should comment in every thread…especially when OP specifically requested we not discuss the Flintstone mobiles. OP’s question is for those who have had the experience of paying for $150K supercars. Did not inquire about Chevy, Honda, $2K cars, car rentals and so forth. There are plenty of other threads about “value” vehicles. OP did not ask if supercar drivers are dumb, narcissistic to think this way and ultimately a roadblock to financial prosperity. Many lessons to be learned here.
    Click to expand...


    That's ok- FLP will comment on any thread he finds interesting. one of the nice things about this forum is that it is not moderated with a heavy hand, and we can contribute our perspectives and opinions. the WCI ethos (I believe) is making prudent financial decisions: buying 150K cars largely does not fall into that category (and offering a different perspective may be valuable to a reader).

     

    Leave a comment:


  • Tim
    replied
    Hmmmm,
    My brother plans to borrow $150k to make a purchase.
    He has plenty invested in the stock market and could pay cash. Is that a wise move.

    Clickbait in the title. Egged on by OP in the Flintstones clarifying statement. NINE PAGES!
    Strong work I’d say. Traditional debt or invest question that traditionally turns into an evaluation of the purchase one way or another. No harm, no foul. Some pretty cool cars.

    Leave a comment:


  • CordMcNally
    replied




    Not everyone should comment in every thread…especially when OP specifically requested we not discuss the Flintstone mobiles. OP’s question is for those who have had the experience of paying for $150K supercars. Did not inquire about Chevy, Honda, $2K cars, car rentals and so forth. There are plenty of other threads about “value” vehicles. OP did not ask if supercar drivers are dumb, narcissistic to think this way and ultimately a roadblock to financial prosperity. Many lessons to be learned here.
    Click to expand...


    You've also got to know your crowd.

    Leave a comment:


  • EntrepreneurMD
    replied
    Not everyone should comment in every thread...especially when OP specifically requested we not discuss the Flintstone mobiles. OP's question is for those who have had the experience of paying for $150K supercars. Did not inquire about Chevy, Honda, $2K cars, car rentals and so forth. There are plenty of other threads about "value" vehicles. OP did not ask if supercar drivers are dumb, narcissistic to think this way and ultimately a roadblock to financial prosperity. Many lessons to be learned here.

    Leave a comment:


  • DCdoc
    replied
    I like nice cars.  $150k isn’t a supercar.  When college is funded (if?) I plan to get a Porsche GT3.  By then I’ll probably be nearing 60.  Maybe by then I’ll want something different.  But, I’d your financial house is in order, there’s no shame in buying something nice you like, whether it is a car, boat, vacation house, airplane, or a host of other expensive toys.  You can have anything but not everything, right?

    Leave a comment:


  • afan
    replied




    Despite this thread running a very predictable course, I am glad to see there are some enthusiasts on this forum.

    If you are being fiscally responsible, there is nothing wrong with splurging on a vehicle just like you would splurge on a boat, vacation, or kitchen remodel. I am always amused to see that some who consider a car simply a means of getting from point A to point B feel as if they are entitled to a pat on the back for keeping it low key. But even more than that, they seem to want to admonish those who care more about the experience than themselves. I can certainly appreciate the non-enthusiast’s perspective but how come it never goes the other way?

    I’ve loved automobiles from a young age and have driven a variety of cars with three pedals since I was a teenager. The visceral experience of selecting my own gears and feeling the engine do exactly what I want never gets old and makes my commute a rewarding part of my day. I have kept it modest but someday, when my loans are long gone and our financial health allows, I’d like to find myself in a used 911 that I plan to keep and maintain for a long time. I don’t see any problem with that and don’t know why a reasonable person would either.
    Click to expand...


    Except that I would never splurge on a boat, vacation, or kitchen remodel. I don't "splurge." I don't accept the assumption that the more expensive option is more desirable. I don't agree that I really want a fancy expensive-thingy- and only my lack of money or fear of poverty restrains me. I would not want to drive or ride in someone else's wanna be supercar. They sound loud, uncomfortable, dangerous and annoying. Even worse if the driver wants to show off how illegally they can drive it. Offensively low gas mileage. Not only do I not want to own one, I want nothing to do with it.

    I have long found it fascinating that many people, all evidence to the contrary, assume that everyone shares their desires. Smokers who assume that everyone wants to smoke, but some are intimidated by the fear of cancer. Drinkers who assumes that everyone wants to drink and those who do not suffer medical conditions that make it unusually dangerous or are recovering alcoholics. Fancy vacation enthusiasts who assume that everyone who can afford it would fly first class to stay in 12 star hotels in Rome. Car aficionados who believe that everyone WANTS a fancy, expensive, fast, exclusive car. None seem able to understand that not everyone wants any of those things. Not everyone has an endless list of things they want to waste their money on.

    Rather than buy any of the above, I would prefer to pick up more shares of VTI. No maintenance. No liability. Very low tax cost and only on the money I actually receive in dividends. Long term likely to be worth more than I paid for them.

    I toy with marketing a line of exclusive pencils. Carefully curated collections of fine #2's hand selected by the world's leading pencil authorities. Covered in gold paint. Owner's initials engraved by old world artisans in Paris. $50,000 each. Only the truly discerning will see the value. Does it do anything useful that a 20 cent pencil (which is how they start life before the gold paint) will not? Of course not. It is a pencil. But that is so not the point.

    Leave a comment:


  • TheDangerZone
    replied
    @MPMD

    My post was not directed at you and I wasn't trying to jump in to a vette vs. supercar argument but it is an interesting thought experiment. Also interesting that all of a sudden since the C8 reveal, and before anyone has had the chance to drive, review, feel or hear the actual car, it has already become a new benchmark of sorts. I sure hope it lives up to everyone's expectations and proves to be reliable. That would be a great thing for the Auto industry.

    Anyway, back to your original thought. You are trying to objectively compare things that are subjective for many enthusiast car buyers. It's not just the horsepower, the acceleration, and the cost. Cars handle differently, their chassis behave differently, their engines sound differently and have different characteristics and torque curves. Chevy has famously cheaped out on Vette interiors which might not be everyone's cup of tea. Other competitors may offer more refinement and in turn, a more rewarding driving experience. It's not just about speed.

    Your bath towel analogy falls flat as well -- you can reuse a bath towel so of course throwing it out would objectively wasteful. Spending more on a car that subjectively better suits your taste is not the same thing.

    (FYI I personally could never imagine myself spending anywhere near 100k or more on a car, at least not in today's dollars)

    Leave a comment:


  • Matas
    replied
    I'll bite and chip in my $0.02.

    First of all, your partner can get whatever he/she wants.

    If it was my money, I'd look seriously at the upcoming 2020 Corvette. I agree with what everyone else has noted about this choice - mainly it's not exclusive and maybe not a true "supercar", but at about $75k (with Z51 performance package and some optional trim) it would be all the performance virtually anyone could handle, certainly on the street and probably on the track as well, and at a fraction of what the true "supercars" go for.

    If one must have the designer label, then look at an earlier model Ferrari 360/430/California, any of which now go for under $100k used. I think the new Vette will spank any of them on the track, but that wouldn't be the primary motivation, I'm thinking, for that buyer.

    And, even with all that performance and money spent, you could still be this guy in the Porsche 911 Turbo S getting passed on the track by a Miata!

    https://www.roadandtrack.com/motorsports/videos/a29929/spec-miata-versus-911-turbo-s-track-battle-proves-driver-skill-is-everything/

    Leave a comment:

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