Doesn't matter whether you withdraw from another account or pay as you earn. You still need to calculate the loss of interest from not leaving or putting in the monthly instalment in the bank at F.D. rate. This is real apple to apple comparison.

You don't withdraw from your FD! Since when did I say to withdraw from FD?

You can change the scenario into a 3 year HP loan and it is same. I know what is EIR, and needless to say, if you keep withdrawing your FD every year then OBVIOUSLY you are on the losing end. I am saying let your FD COMPOUND year after year.

Then where are you getting the cash to pay the car loan?

My goodness. Even after that illustration, you still don't understand. My RM100,000 is in FD from day one. While I steadily, pay for installments every month. Your FD made money for you, despite after paying off all instalments. But a car bought with RM100,000 cash, did absolutely NOTHING, nada.

Does it matter? As long as it is not coming from the FD. Do you see my point now?

At the end of the day, your cashed out compounded FD will be more than what you paid in total for all installments. How is this worse than dumping your big chunk of liquid cash onto a depreciating item like a car??

Then the correct comparison will be pay off the car using cash and put the same monthly instalment to FD. You are comparing apples and oranges.

Wrong again . Because I could pay fully 100k on the car and pay a monthly instalment to FD which will also outperform your scenario.

LOL. Really? And how much are you putting into this FD every monthly installment? Go ahead and tabulate.

You can change the loan scenario however you want but it is not possible to earn more in interest from F.D. than you are paying in interest on a H.P. loan on the same amount. Banks know how to calculate the return on their funds.

He is putting all your monthly payment to the loan into FD.

You resort to saying banks know what they are doing when you don't have a comeback.

What you FAIL to realise is that hire puchase interests are low to encourage car sales in Malaysia. It generates money for the banks. Banks take your FD deposits and make much more than what they give you back.

What I am saying is, if you HAVE the money (cash), you can take advantage of this.

Nope! He is saying instead of dumping RM100,000 in FD, he is placing it on the car. He then pays MONTHLY to an FD that will outperform my scenario. So I am merely asking him to show how that will work out for him.

316i ?

Abort the plan bruh.

posers car

Exactly the same amount as the car loan instalment. It has to be apple to apple remember.

Here's the tabulation:-



So at the end of 9 years the FD will get a total of 142K , while not having a car loan and paying an exact 14k instalment to the FD will yield 154k. Not having a car loan scenario outperform it by RM12k.

This post has been edited by Drian: Dec 7 2015, 03:11 PM

First of all, previously you said MONTHLY installments. Your table shows YEARLY installments.

Are you trying to embarrass yourself?

Edited.

Also one more thing, only 8th year onwards your method overtakes. Can the same be said for lower tenures?

This post has been edited by MrPoppyplants: Dec 7 2015, 03:29 PM

LOL you actually think it will make a big difference.
Go ahead and calculate using month and compound it monthly and adjust so that it comes up to 4% pa. I'm too lazy to proof to you it's the same or you can bring this information to Finance thread and argue there.


If you haven't realise it by now, banks will give you lower rates the longer tenure you make. So if you shorten the tenure, the interest rates will be higher.

I don't need you to proof anything to me. Your first sentence already shows how ignorant you are. There is a big difference in interest earned from 12 months of installments compared to one year's installment. This will greatly affect your end result.

There is a big difference, really? LOL lets see who's more ignorant at the end of the day ya.




~152k vs your 142k

So big difference OMG.. LOL

You want to talk about investment but you are trying to justify to me that a difference of RM2,000 is nothing?

You really want to win? OK.

You want apple to apple comparison? Fine.

Tell me which bank offers a FIXED DEPOSIT which allows you to top up a fixed amount every month and yet still gives you 4.0% PA in order to project your wonderful table for 108 months. If you can't find one, fine. How about switching from FD to FD every single month? For 108 months you are going to do that? How about processing time and fluctuations in interest rates in between? Can you guarantee that for 108 months??

If you can do the above. I will admit that you are right. And I will stop.

*rolls eyes* come on. The example you have can be put on theory but can you really prove that it works in reality? We would believe it if you can give 100% assurance regardless of frustrated circumstances or not.

We need that example of how to utilize FD to make it actually work for us than against us as you succinctly put it.

However you forget that banks always ultimately cover their sides so anything in small print states *banks reserve the rights to change the terms etc* is an indication of legal disclaimer.

Likewise, for 9 years, anything could change

This post has been edited by S'aimer: Dec 7 2015, 06:17 PM