Loan or Buy outright

[dvd7e]

My car is an '07 model and I don't have any plans on buying a new car for a while. But.....

Does it make more sense to
a) Start saving in advance and buy my next car outright

or

b) Take out a loan on the car and invest the money I would have used in purchasing it


I know it all depends on the numbers - you could probably fudge the numbers to make either one the better option - but I'm just wondering which one makes more sense generally speaking.

[jIM_Ohio]

Borrow against current car? NO does not make sense (meaning putting current car up as collateral for borrowing, then investing the money you borrow)
Borrow for purchase of new car- possibly
Save and pay cash for new car -yes

its a matter of how much risk you are willing to take and how good a deal you can get on financing the next purchase as well as cash flow at the time of purchase.

[wfhouses]

Save your money. I would never advise borrowing money especially for a car. It is best to purchase a car with about 10-15k miles on it. Gives the car a break in period and saves you much of the retail markup.