Quote:
Originally Posted by Prodigy
Quote:
Originally Posted by Arizona
One more thing,...not to pry, but how much cash do you have?
There are a lot of guys on this board who will help with the advice, and let me tell you,....it like gold. Gman, rank, rev, even new guys like Steve booth have valuable input, so be patient, they will all probably chime in soon.
I have $30g and I'm not gonna put all my chickens in one basket.
Yeah I wonder where GMAN is? I sent him a PM this morning...
I didn't get your message until late last night, or early this morning. If it sounds a bit strange, I was sleepy.
I don't know anything about this company you mentioned. Leasing can help preserve some working capital and is usually not listed as a liability on your balance sheet where as a loan is considered a liability. I don't see any great tax advantages to leasing, at least to someone starting out. You can depreciate a truck and write the interest expense off so it can be just as much of an advantage as leasing, from a tax point of view. Also, the last 2 or 3 years, I believe, the laws have changed to aid smaller business to purchase more equipment. You could write the entire cost off the first year, if you choose to do it. I don't know if that will be available this year or not, but it was a year to year thing the President initiated to help purchase equipment up to a certain dollar amount. I believe it was under $200,000.
As I noted in my response to your pm, if I were you I would take $20,000 out of the $30,000 and pay cash for a truck. That will still leave you with $10,000 to operate on or use as an emergency fund. You won't have any monthly payments to make and can save a lot of money on interest. Most lenders require borrowers to pay a down payment of around 20-30% of the purchase price. If you lease some require 10%, first and last or first, second and last payments. It depends on the leasing company. It is a great feeling to have a piece of equipment paid off. It gives you flexibility to sit if you can't get a decent rate. It is the guys who have the big payments who seem to find the need to run for $0.85-$0.90/mile just to keep the wolves at bay.
If you pay cash and put the equivalent of a monthly payment each month, you can upgrade to the truck you want in a year or two and not have to worry about payments. Consider it a business decision. It is too easy to let the emotions control our decision making process. The idea is to make money. You will make more money with a paid off truck than if you make payments.