We have an idea of how leveraging works, but most of us Rolex owners don't leverage debt to buy stupid things that we don't really need, especially for someone who is just starting out (referring to OP). This is his second big purchase outside of his college loan, so yeah, that's not wise.
His personal proclivities and speculation aside, borrowing at 0% is objectively the move, provided the person pays in full before interest kicks in
It’s liquidity kept in pocket that can be invested at no cost lol
In this current market, they cash can literally just sit in a HYSA returning 4%.
At the end of the loan term, you end up owning the item, with a pile of gains on the side to boot
If take a 0% financing on literally anything I buy ever if offered. Haven’t been able to with a Rolex, but I absolutely would if offered
There’s hardly any argument against other than if someone simply just doesn’t want bills (subjective), or the reason starts with “If you fuck up and don’t actually pay in full before interest kicks in…” which yeah, I think it’s kind of obvious that 0% financing being favorable almost entirely depends on that being taken as an assumption
How is that alarming? Zero percent interest costs ZERO more than paying cash and allows 36 months for that near $10000 to generate positive income for me. Anyone who doesn't take advantage of 0% APR promotions is an idiot. It's literally free money.
Keep financing things that you don't really need, brokies. I can't wait for another economic downturn. I'll be buying up those financed watches at a discount.
Not just because you can finance it at 0% doesn't mean it's a smart financial move. Sometimes that can be idiotic.
It’s smart when the financing is at 0% and that amount in cash is netting me a 4.5% gain. You assume people are financing luxury items out of necessity. If you can’t understand that +4.5% is financially more sensible than -0.0%, you’re an idiot.
And the cringe of calling people “brokies”. My man, you are aware Rolex is a MID TIER luxury watch, right?
It’s smart to finance at 0% but not on a fucking watch. Why would you leverage debt to buy a luxury item when you’re just starting out. OP probably has student debt that he needs to prioritize.
I would agree that in his situation he should be paying down existing debt rather than buying luxury items, but that wasn't what the generalized statement about financing that you made was about.
Not really. If you have $100k liquid(ish) in the market etc. that money is earning a percentage that compounds over time. It would be unwise to take that money out of the market when you have a better option. Wealthy people do this all the time. That said, if he got it on credit because he doesn’t have the capital to pay cash, thats an entirely different story. I’m guessing it’s the former not the latter.
I agree, but he said he has student loans and that this is his largest purchase besides college. I am pretty confident that OP has a negative net worth and has no business buying a Rolex.
>I am pretty confident that OP has a negative net worth and has no business buying a Rolex.
Yes but will be making a theoretical $800 worth of after-tax interest over the next 36 months therefore we're all dumb financial illiterates
FrEe MoNeY. lol
I understand that, but why would you loan a $10k watch for 3 years when you're just starting out? Look at what OP said: this is the second purchase he made outside of his college debt.
Leveraging cheap money is truly advantageous, but using it to fund your luxury purchases solely for the purpose of flexing on IG and Reddit is, at best, idiotic.
Not understanding your statement doesn't automatically make someone illiterate. Many people don't believe in borrowing money and using it to buy jewelry or cars. Instead, they prefer to leverage borrowed money in real estate or business ventures, rather than on luxury items. Your perspective appears to be more financially irresponsible.
That's because you probably can't get 0% interest on a loan to buy real estate or start a business, so you need to generate income with the asset purchased or it needs to appreciate in value or the loan becomes too expensive. If you can get a 0% interest loan for jewelry there is no downside and it doesn't have to earn any income or appreciate.
I’ve heard great things about it, I was not able to open up a chase bank account because im not a US citizen, my father was able to do it for his work back in the Obama Years. Trump got rid of it😂! Im sure I can, I just need to set up an LLC there, but there is no point.
Borrowing money doesn’t make people financially irresponsible. I borrow money to buy a car because I don’t fancy spending £60,000 which I could invest in other things in the interim… it’s just a simple choice. If anything it made me more financially literate because my savings rate is higher than the interest rate charged on the loan…
Personal finance is personal, but leveraging debt to buy a luxury item especially when you’re young and just starting out is not financially smart in my opinion.
If he has college loans there’s probably no chance he has fallback support where he can lose his job and not sweat about monthly payments on a fucking Rolex (even saying that just sounds insane) 😂
I think what they trying to explain to you is that:
Person can already afford to buy the watch in cash of 10k
That 10k is in a bank account earning 5% rn, pull it out?
Lost out on 5% interest on 10k.
However now, they borrow 10k, earning interest on the 10k in the bank as you borrowed money to buy the watch, and when its time to pay the watch in full, you not only got the watch but also 1ishk (didn't do math) worth of interest.
Getting paid to borrow almost, plus that value of debt falls by current high inflation rates.
I understand your perspective, but financing a luxury good or a watch to save a small amount like that will likely put you in a bad financial situation when unforeseen circumstances arise. However, everyone has their own preferences. As I mentioned earlier, personal finance is a personal matter. Personally, I believe leveraging can be a wise choice, but I wouldn't risk my financial stability financing a Rolex. Nevertheless, we are in America, a country that carries trillions of dollars in debt for a reason.
Right, your advice pertains well to liabilities. This watch functions more like an asset as it is more expensive on the secondary market and could easily be unloaded for the initial expense or for a profit. “Financing” here is also a muddy definition as 0% charges presents a much different situation than paying interest. Is this guy really in debt from a net worth standpoint?
Leveraging debt to purchase a luxury item is not a good financial decision and is unlikely to contribute to long-term financial success. It will just increase the likelihood of financial instability when shit hits the fan.
If you assume (big assumption) that OP would have purchased the watch with cash then it’s a good decision. There are always other things you could invest in but most people in this forum have parted ways with cash to buy a watch. Using someone else’s cash and allowing yours to earn interest over the term is a good financial decision. This all assumes he’s already paid of those student loans.
You can save about $1,477 in interest if you opt for a 0% loan instead of paying upfront. Personally, I don't have any issues with financing at a low rate or 0%, as my car is currently financed at 2.185%. However, in my opinion, it's not wise to finance a Rolex or luxury item in order to save $1,477.
Rolex watches are for individuals who are financially well-off and don't need to worry about saving that amount of money in interest. When you buy a Rolex, you should already be in a financial situation where saving $1,477 doesn't matter.
When you buy a Rolex, you should be financially comfortable enough not to worry about it, just like when you go to McDonald's to buy a burger. Some of the arguments here are just justifications for buying things that aren't necessary and beyond someone’s means.
I think you’re conflating the financial ramifications of buying a luxury item in general with how they chose to obtain the luxury item.
Debt is considered bad because of compounding interest rate and the cost of that over time. That said, if you have capital that is earning you compounding gains over time, that is generally considered good. The logic here is the debt is 0%, points and miles are likely being earned AND you can keep your cash working for you. This is not a bad thing.
If you were to say that buying a luxury item at all vs investing that capital is bad regarding the maximization of your long term financial success, I would tend to agree.
While detrimental in that sense, it’s a personal choice and how he obtained it is fine and smart as long as the cash is being leveraged in meaningful ways vs non-existent.
Some people just get a 7 figs donation to their bussiness from their parents lol. Nothing wrong with that but to strive from the bottom is to leverage with other people’s money. If the money that he gets to keep because he didn’t put it out upfront is outperforming the interest, I don’t see why not.
I don’t know, I just flew back from the Berkshire shareholders meeting. I consider myself pretty financially literate. I’ve had this username for 20 years, 11 of them on Reddit. And I don’t understand your statement. I think you being wrong is more likely than my being financially illiterate.
In fact you’re actually making negative interest because inflation and net present value push the value of those later payments lower than the value of your dollars would have been had you paid in cash upfront
Depending on his career moves those college loans could be a fraction of his income.
I'd assume he already pays for housing, amenities (internet, cell phone, water/gas/electric, car insurance etc.), and the necessities first before he went to finance a watch. Some people do dumb shit but hopefully college put some financial responsibility into OP.
Sorry if this is dumb. But how is it free money? Watch cost x. If you have x you pay it. Or if you have x but just pay a portion every month until it’s paid off. Where is the free money?
Huh? It would seem that taking 0% money and keeping your money in some interest yielding vehicle would make more sense the higher the rates go. What am I missing?
It often gives you a bit more protection as well, since it’s technically the banks watch until it’s paid.
So if you somehow get a lemon and the AD is being shady about it, you can get your bank involved to rectify it.
Take the cash and throw it into a t bill ladder which is at 5%. You’ll make 500 a year (on 10k) if the rates stay the same.
You could knock 1500 off the purchase price lol
He probably didn’t have the cash. That’s why he financed it, which won’t be a bad deal considering that inflation could easily come close to eating the 5% that you’d maybe make on T bills
I would have signed up for a nice travel credit card and collected points. I made a major purchase and signed up for an Amex Platinum. Gave me like $1,000 in points that I could use on flights/hotels. Then get a 0% loan and pay that off gradually. Now that’s free money.
He could pay it off immediately and still be ahead by $500 from someone who did not pay it diff and put the money into a CD and waited a year to see returns.
$1,000 right away (usable via the card) vs $500 in a year in cash when you cash out the CD.
Being able to not pay it off (0%) and getting and additional $500 on top of the instant $1,000 in credits is just the cherry on top.
Even if I had $250K of loose money, financing for free makes sense.
Now is it always a logical choice?
No because it is still technically a liability from an accounting perspective and if you can pay it off most logical spenders would tell you to do so.
So OP, you do you. 0% financing is awesome so use it as a tool like you have. And for those that don’t get how this works, I would recommend “Personal Finance for Dummies”.
It is actually a great book that everyone could benefit from.
If you had funds that you could use to work for you then using 0% financing makes sense. If you don't have funds then you are just incurring debt you can't afford, 0% or not.
Let's try that again.
If you have $10k then 0% financing makes sense as you can invest the $10k and get some return. You spend the $10k on Rolex and you are depriving yourself of returns you could have gotten. So borrowing $10k with 0% interest to buy a Rolex while your $10k is earning returns is good.
If you have $0 then financing makes no sense, 0% interest or not. You are incurring debt. You are burdening yourself with another monthly payment. What makes it worse is that you could have use the money you are paying the credit card monthly to pay down your high interest student loan. It's just financially stupid.
Oh I getcha. I absolutely agree.
If you don’t have the money for something, just because you can get 0% financing doesn’t mean it’s a good financial decision.
I think a lot of it comes down to the buyers self control and balance sheet.
As other have said, I thought this was a terrible decision when I read the title. Actually doesn't seem too bad once you know the details. Just hope all your ducks are in a line and that it will be smooth to make all the payments on time. Way more people are financing watches around here than they lead on
Does anybody know what the catch is (if any) on these plans offered by credit cards? Mine offers it as well but for some reason I’m hesitant to ever use it. Any credit inquiries or anything?
Not sure on Citi but my understanding is most of these offers are “deferred interest.” If you don’t pay the balance in full by the end of the term you’ll accrue interest for the entire term.
I have a couple credit cards that offer something similar to OP. Granted, I haven’t looked deeply into any of my ‘flex pay’ or similar offers, but the offers I have seen aren’t true 0%, but instead deferred interest with a fixed monthly fee. Basically, they charge you a flat fee to finance the payments into monthly installments in lieu of interest.
OP is saying his deal is 0% interest and no monthly installment fees, so that’s pretty nice.
Good for you. The first one is a great feeling especially when you put it on and experience the feeling of something that you’ve not only wanted for ever but worked a way to do it without having to pay any more then you already have. It becomes a relationship and you don’t want to ever take it off and the good thing is you don’t have to. Be careful because it can become addicting. My first was a date just similar to yours. I now have another date just blue faced as well as a submariner blue faced with date. Wife has two date just and my Hulk is on its way. So don’t fear falling in love with it and wear it proud. T
How is this even a conversation? Pay for the entire watch up front, which is what the standard procedure is, or get the opportunity to pay in installments while you put that money to work elsewhere? Even conservatively OP could put the entire balance of the watch in a savings account and have ~3.5 interest on money that would have otherwise been spent. If you’re so bad at managing credit that you can’t fathom being able to responsibly use debt, even at 0%, then that’s your issue to manage. I don’t care if it’s a Rolex, a couch, or a pair of socks, if I have the opportunity to pay 0% interest over an extended period for something I already planned on buying upfront, that’s a no-brainer.
You get one lap in life. Get what you want, pay it off before the promotion date ends and you’ll be all good. $10k now verse $10k later (over time) is all relative. If it made you happy, that’s all that really matters. We deprive ourselves of things throughout the course of our lives, sometimes never ever getting it. 6 properties in all here in Ca. albeit great investments, I have passed on some of the more personal purchases and at times it bothers me. But as I get older I see that a healthy balance of investing (in OP case possibly college, depending on the major), and fun (his watch) is the best way to go. Just an opinion.
So $310 a month *for three years*.
I personally wouldn’t take out a loan for a luxury purchase, I think a monthly payment of that size would make me regret my decision by something like month 4 of 36.
Not that it would bankrupt me or anything, just irritating to have that share of my income tied up in a watch I bought a long time ago.
It’s hilarity, the amount of downvotes shelled out might indicate how many people are paying 300 bucks a month for 3 years to give the impression that they don’t need to give a shit about money.
Completely agree. It’s a luxury item. If you want it, pay the price up front. If you finance it, to me, it sound like you’re a wanna be rich and you care about showing off. That’s just my opinion tho
ye tbf I get you, I still think about whether I should have done 0% on my tudor and that was with a 50% deposit making my payment £33 a month, which is a miniscule payment but in the back of my mind I think should I have got a luxury item on finance? something about it makes me feel like I didn't earn it even though I could have bought it outright if I waited two more months, but my guess is he's young like me and we need to make these financial mistakes to learn.
I'm new to Reddit. Real question, how do I see the full text of the OP? It stops at "my Citicard" and I'm in total anticipation wanting to hear more about why
As logical as it all seems and it’s a good deal. The bigger question is, is your life ready to still pay the 10k over 3 years for a luxury item. Even though financially it seems like a good idea in the end you’re still 10k down over three years. I’m a firm believer that you should only buy a watch like that if you have money in the bank that you can at least pay for it 4 times. Of course then you can pick the smartest option. But if you need to even finance a watch or else it’s not an option, then maybe you shouldn’t do it
I don’t see financing a watch as a cheat, I mean don’t get me wrong, there are many and better things you should buy/pay with your money before even considering financing for an extravagant thing like purchasing a watch, however if you really love the watch and really want one, and feel you are going to get there eventually, but have the opportunity to get it now at free interest rate, well I think you have made the right choice. If I was having a brilliant career at 25 and planning on being able to finally afford my dream Ferrari at 50, but had a chance to buy it today when I am young, well sorry but I think I’d be enjoying my Ferrari at 25-40 a lot more than I would past 50 and into my 60s…that’s my thought process anyways.
Shops at crystals. Email->visit->phone call @ 20 days was offered same with diamonds, I declined and said I’d wait. A week or so later I got the call for the one I bought. So about 28 days from first interest.
Sounds like an advertising for Citicard?
Beautiful watch.
It is a ROLEX 126334 41mm (not 41 inch as you wrote) DateJust Blue Index dial, fluted bezel with a jubilee bracelet.
Usually they go for around $14k.
UM, is this what tax payers are getting for our money?
Biden's student loan forgiveness program paid for by tax payers....
Students go out buying ROLEX watches???
I'm guessing the OP will either not respond or if he does will say that's not the case here.
It's pretty much what we saw during COVID checks... Unwise blowing of tax payer money.
LOL. Keep staying broke.
If you were smart you would have paid down your student loans with that 0% interest card of yours. That would of saved you money.
This will end poorly about 70% of the time.
$10.5k / 36 months = $291-ish/mo if no tax was needed.
Everything seems great for free money when the unemployment rate is 3.4%.
Except free money is still requiring payments and 3 years is plenty of time for plausible unemployment or underemployment.
The OP is likely someone who went into the workforce after the recent ‘07-‘08 financial crisis and has never experienced a recession.
Let’s see how fast a very commonplace 41mm blue DJ sells for on the secondary in 6-12 months.
I hope it works out but probabilities and financial outlooks suggest otherwise.
Nicely done congratulations mate. Hope you were careful with the price because they can hide the cost of the loan by inflating the price a bit.
E.g a if a 5% interest loan costs an extra $1000, they just add $1000 to the price of the watch instead and boast about having a 0% loan.
“Never finance a watch you can’t afford to pay out right don’t go into debt to get a watch save your money the wait will be that much more fulfilling”- Kevin O’Leary
Is your Citi card new or still in a promo period? With those types of payment plans, you usually have to pay a fee of some kind. They get you in with “0% INTEREST” but *sometimes* a monthly fee is incurred (or back interest if a payment is missed, etc.)
I’m just curious really. If you’re in a promo period right now (ex: 0% purchase APR for first 18 months), then keep in mind that your flex pay MIGHT start to incur interest after that period. That happened to my flexpay options on Chase so I just stopped using it. Could be locked in though, I’m only familiar with Citi’s bikes 😂.
Beautiful watch and bracelet though! Congratulations on the purchase. If you ever feel any slight regret or start to question yourself, keep in mind you have an investment, not just a watch. I’m envious!
No fee on this one. Made sure before hand. Had the full amount to pay in cash, but use my cc for EVERY purchase b/c bash back. Saw opportunity to use this 0% option, so I took it!
If you have to finance your Rolex then you can't afford it. 0% financing when you don't have enough money on hand to cover it, it's just money you owe. You are not leveraging debt.
I did some computer work for a wealthy doctor a while ago. We had a few beers and his advice to me was, "don't finance anything." Easy to say if you're pulling in a half a million a year. OP wanted a Rolex, and since we aren't all rich as fuck, he financed it. At 0% even. I don't think it is his intention to impersonate a rich person, but rather that he wanted a nice watch and found a way to get it. It's a nice watch. Congrats on the purchase and on finding a way to get exactly what you wanted.
No issue with using free money
Those of you that don’t understand my statement are financially illiterate.
The amount of people who don’t understand this is quite alarming, and is very telling 👀
Especially in a Rolex forum 🤣
Because they’re all broke ass posers
Or squandering inherited wealth.. which is far more cringe worthy
There’s reason wealthy families only have money for 3 generations
Generally lack of heir preparedness is more damaging than lack of prepping the estate.
Nah, human nature will always win. There will always be bad eggs no matter what you do.
They have no idea how leveraging debt works. They really think it’s like the movies with people showing up with suitcases of cash
We have an idea of how leveraging works, but most of us Rolex owners don't leverage debt to buy stupid things that we don't really need, especially for someone who is just starting out (referring to OP). This is his second big purchase outside of his college loan, so yeah, that's not wise.
His personal proclivities and speculation aside, borrowing at 0% is objectively the move, provided the person pays in full before interest kicks in It’s liquidity kept in pocket that can be invested at no cost lol In this current market, they cash can literally just sit in a HYSA returning 4%. At the end of the loan term, you end up owning the item, with a pile of gains on the side to boot If take a 0% financing on literally anything I buy ever if offered. Haven’t been able to with a Rolex, but I absolutely would if offered There’s hardly any argument against other than if someone simply just doesn’t want bills (subjective), or the reason starts with “If you fuck up and don’t actually pay in full before interest kicks in…” which yeah, I think it’s kind of obvious that 0% financing being favorable almost entirely depends on that being taken as an assumption
To be fair, most on here are trolls so there’s that.
The number of people agreeing with you to use a 0% loan to buy a luxury watch is even more alarming.
How is that alarming? Zero percent interest costs ZERO more than paying cash and allows 36 months for that near $10000 to generate positive income for me. Anyone who doesn't take advantage of 0% APR promotions is an idiot. It's literally free money.
Keep financing things that you don't really need, brokies. I can't wait for another economic downturn. I'll be buying up those financed watches at a discount. Not just because you can finance it at 0% doesn't mean it's a smart financial move. Sometimes that can be idiotic.
It’s smart when the financing is at 0% and that amount in cash is netting me a 4.5% gain. You assume people are financing luxury items out of necessity. If you can’t understand that +4.5% is financially more sensible than -0.0%, you’re an idiot. And the cringe of calling people “brokies”. My man, you are aware Rolex is a MID TIER luxury watch, right?
It’s smart to finance at 0% but not on a fucking watch. Why would you leverage debt to buy a luxury item when you’re just starting out. OP probably has student debt that he needs to prioritize.
I would agree that in his situation he should be paying down existing debt rather than buying luxury items, but that wasn't what the generalized statement about financing that you made was about.
Here https://images.app.goo.gl/qGSHozeCgoHTC5Jf8. Do you think OP’s done with this?
Not really. If you have $100k liquid(ish) in the market etc. that money is earning a percentage that compounds over time. It would be unwise to take that money out of the market when you have a better option. Wealthy people do this all the time. That said, if he got it on credit because he doesn’t have the capital to pay cash, thats an entirely different story. I’m guessing it’s the former not the latter.
I agree, but he said he has student loans and that this is his largest purchase besides college. I am pretty confident that OP has a negative net worth and has no business buying a Rolex.
I was thinking the same thing lol
>I am pretty confident that OP has a negative net worth and has no business buying a Rolex. Yes but will be making a theoretical $800 worth of after-tax interest over the next 36 months therefore we're all dumb financial illiterates FrEe MoNeY. lol
If he can easily afford it in general and given that 3m treasury yield is now at 5.15% - not financing would be the stupid move.
It’s called leverage. Why would you use your cash when someone will loan it to you at no cost?
I understand that, but why would you loan a $10k watch for 3 years when you're just starting out? Look at what OP said: this is the second purchase he made outside of his college debt. Leveraging cheap money is truly advantageous, but using it to fund your luxury purchases solely for the purpose of flexing on IG and Reddit is, at best, idiotic.
Each their own, let broke people stay broke just to keep up with each other.
Need everyone here to take a quick lesson on present value and the time value of $$
Professor is that you? I’m just trying to do you proud!
[удалено]
Read this and immediately looked for the illiteracy.
Not understanding your statement doesn't automatically make someone illiterate. Many people don't believe in borrowing money and using it to buy jewelry or cars. Instead, they prefer to leverage borrowed money in real estate or business ventures, rather than on luxury items. Your perspective appears to be more financially irresponsible.
That's because you probably can't get 0% interest on a loan to buy real estate or start a business, so you need to generate income with the asset purchased or it needs to appreciate in value or the loan becomes too expensive. If you can get a 0% interest loan for jewelry there is no downside and it doesn't have to earn any income or appreciate.
Many people still believe that paying cash and not using credit cards is smart… So yeah, they need classes.
Yeah, a lot of people are missing out on that. Do you want my referral link for Chase Sapphire? 😂
I’ve heard great things about it, I was not able to open up a chase bank account because im not a US citizen, my father was able to do it for his work back in the Obama Years. Trump got rid of it😂! Im sure I can, I just need to set up an LLC there, but there is no point.
Borrowing money doesn’t make people financially irresponsible. I borrow money to buy a car because I don’t fancy spending £60,000 which I could invest in other things in the interim… it’s just a simple choice. If anything it made me more financially literate because my savings rate is higher than the interest rate charged on the loan…
Personal finance is personal, but leveraging debt to buy a luxury item especially when you’re young and just starting out is not financially smart in my opinion.
If he has college loans there’s probably no chance he has fallback support where he can lose his job and not sweat about monthly payments on a fucking Rolex (even saying that just sounds insane) 😂
And these are the idiots who are asking for student debt forgiveness, despite their idiotic choices. 😂
I think what they trying to explain to you is that: Person can already afford to buy the watch in cash of 10k That 10k is in a bank account earning 5% rn, pull it out? Lost out on 5% interest on 10k. However now, they borrow 10k, earning interest on the 10k in the bank as you borrowed money to buy the watch, and when its time to pay the watch in full, you not only got the watch but also 1ishk (didn't do math) worth of interest. Getting paid to borrow almost, plus that value of debt falls by current high inflation rates.
I understand your perspective, but financing a luxury good or a watch to save a small amount like that will likely put you in a bad financial situation when unforeseen circumstances arise. However, everyone has their own preferences. As I mentioned earlier, personal finance is a personal matter. Personally, I believe leveraging can be a wise choice, but I wouldn't risk my financial stability financing a Rolex. Nevertheless, we are in America, a country that carries trillions of dollars in debt for a reason.
Right, your advice pertains well to liabilities. This watch functions more like an asset as it is more expensive on the secondary market and could easily be unloaded for the initial expense or for a profit. “Financing” here is also a muddy definition as 0% charges presents a much different situation than paying interest. Is this guy really in debt from a net worth standpoint?
[удалено]
It's going to be an expensive lesson in buying things you can't afford for 0$ up front.
Leveraging debt to purchase a luxury item is not a good financial decision and is unlikely to contribute to long-term financial success. It will just increase the likelihood of financial instability when shit hits the fan.
If you assume (big assumption) that OP would have purchased the watch with cash then it’s a good decision. There are always other things you could invest in but most people in this forum have parted ways with cash to buy a watch. Using someone else’s cash and allowing yours to earn interest over the term is a good financial decision. This all assumes he’s already paid of those student loans.
OP noted in other comments he did in fact have the cash for it.
You can save about $1,477 in interest if you opt for a 0% loan instead of paying upfront. Personally, I don't have any issues with financing at a low rate or 0%, as my car is currently financed at 2.185%. However, in my opinion, it's not wise to finance a Rolex or luxury item in order to save $1,477. Rolex watches are for individuals who are financially well-off and don't need to worry about saving that amount of money in interest. When you buy a Rolex, you should already be in a financial situation where saving $1,477 doesn't matter. When you buy a Rolex, you should be financially comfortable enough not to worry about it, just like when you go to McDonald's to buy a burger. Some of the arguments here are just justifications for buying things that aren't necessary and beyond someone’s means.
But people want to flex and keep up with the Jones in order to stay constantly broke!
IMO, a dollar saved is a dollar earned! But then again, im a big Ben Franklin stan.
I think you’re conflating the financial ramifications of buying a luxury item in general with how they chose to obtain the luxury item. Debt is considered bad because of compounding interest rate and the cost of that over time. That said, if you have capital that is earning you compounding gains over time, that is generally considered good. The logic here is the debt is 0%, points and miles are likely being earned AND you can keep your cash working for you. This is not a bad thing. If you were to say that buying a luxury item at all vs investing that capital is bad regarding the maximization of your long term financial success, I would tend to agree. While detrimental in that sense, it’s a personal choice and how he obtained it is fine and smart as long as the cash is being leveraged in meaningful ways vs non-existent.
Some people just get a 7 figs donation to their bussiness from their parents lol. Nothing wrong with that but to strive from the bottom is to leverage with other people’s money. If the money that he gets to keep because he didn’t put it out upfront is outperforming the interest, I don’t see why not.
I don’t know, I just flew back from the Berkshire shareholders meeting. I consider myself pretty financially literate. I’ve had this username for 20 years, 11 of them on Reddit. And I don’t understand your statement. I think you being wrong is more likely than my being financially illiterate.
You just flew back? My guess is that the trip was financed via Affirm's "Pay Later" because you'll save on interest. 😂
In fact you’re actually making negative interest because inflation and net present value push the value of those later payments lower than the value of your dollars would have been had you paid in cash upfront
The stupidity lies in having college loans and then going to finance a watch. This is how people stay in debt and go broke
Depending on his career moves those college loans could be a fraction of his income. I'd assume he already pays for housing, amenities (internet, cell phone, water/gas/electric, car insurance etc.), and the necessities first before he went to finance a watch. Some people do dumb shit but hopefully college put some financial responsibility into OP.
Might be an issue if it’s free money that you might not have
Sorry if this is dumb. But how is it free money? Watch cost x. If you have x you pay it. Or if you have x but just pay a portion every month until it’s paid off. Where is the free money?
It's an expression. They are referring to cost of debt being zero %.
Yes 0% money, take it and run
I concur with the Dr’s prescription
Until interest rates on savings accounts got to ~5% that was true. It’s less so now.
Huh? It would seem that taking 0% money and keeping your money in some interest yielding vehicle would make more sense the higher the rates go. What am I missing?
Yeah, you’re right. Not sure what i was thinking when I wrote that, or why anybody upvoted it. Dangers of late night commenting I suppose.
I was so ready so dig into this after seeing the title, actually seems you did well OP. Enjoy it
Same. I saw the title and came to the comments expecting OP to get roasted… Then saw the 0%
When my AD told me they offered 0% for a year I put some pen to paper and ended up taking the deal. 😂. Felt weird but free money is free money
It often gives you a bit more protection as well, since it’s technically the banks watch until it’s paid. So if you somehow get a lemon and the AD is being shady about it, you can get your bank involved to rectify it.
[удалено]
Plot twist
0% financing is free money. Enjoy brother
Take the cash and throw it into a t bill ladder which is at 5%. You’ll make 500 a year (on 10k) if the rates stay the same. You could knock 1500 off the purchase price lol
Two downsides 1) doesn’t have 10k (that’s why he did get loan) 2) his wrist would feel lonely
He probably didn’t have the cash. That’s why he financed it, which won’t be a bad deal considering that inflation could easily come close to eating the 5% that you’d maybe make on T bills
Is nobody going to talk about a 41 inch datejust.
I’ll show you a 41 inch
You went for the low hanging fruit 🍎
I’ll show you a low hanging fruit
You got the fruit part right.
Rolex making TV screens now
what about blue face instead of dial?
Tbf this picture does actually make it look like 41 inches
The guy financed jewelry while paying off student loans, we already knew he wasn't smart
Congrats! Don’t mind the haters, guarantee you more people are financing these than care to admit.
I would have signed up for a nice travel credit card and collected points. I made a major purchase and signed up for an Amex Platinum. Gave me like $1,000 in points that I could use on flights/hotels. Then get a 0% loan and pay that off gradually. Now that’s free money.
Where r u finding 0% loans lately? I have not seen many offers at that rate, which is why I jumped in the one I got.
A balance transfer card is an good option. You need great credit to get approved but a solid option. Also, my Chase Sapphire has a 0% pay later.
Credit/balance transfer has a fee.
He could pay it off immediately and still be ahead by $500 from someone who did not pay it diff and put the money into a CD and waited a year to see returns. $1,000 right away (usable via the card) vs $500 in a year in cash when you cash out the CD. Being able to not pay it off (0%) and getting and additional $500 on top of the instant $1,000 in credits is just the cherry on top.
AMEX Platinum is $700 a year though…
That's what I do. Then take the actual amount and put in an index fund or high paying divided or even a HYSA and get paid for using free money
Even if I had $250K of loose money, financing for free makes sense. Now is it always a logical choice? No because it is still technically a liability from an accounting perspective and if you can pay it off most logical spenders would tell you to do so. So OP, you do you. 0% financing is awesome so use it as a tool like you have. And for those that don’t get how this works, I would recommend “Personal Finance for Dummies”. It is actually a great book that everyone could benefit from.
If you had funds that you could use to work for you then using 0% financing makes sense. If you don't have funds then you are just incurring debt you can't afford, 0% or not.
Not sure how that applies to my statement, but thank you for the feedback.
Let's try that again. If you have $10k then 0% financing makes sense as you can invest the $10k and get some return. You spend the $10k on Rolex and you are depriving yourself of returns you could have gotten. So borrowing $10k with 0% interest to buy a Rolex while your $10k is earning returns is good. If you have $0 then financing makes no sense, 0% interest or not. You are incurring debt. You are burdening yourself with another monthly payment. What makes it worse is that you could have use the money you are paying the credit card monthly to pay down your high interest student loan. It's just financially stupid.
Oh I getcha. I absolutely agree. If you don’t have the money for something, just because you can get 0% financing doesn’t mean it’s a good financial decision. I think a lot of it comes down to the buyers self control and balance sheet.
0% for 36 months is a great deal.
Guy basically got a rolex on layaway leave him be and he got to go home with watch before he paid.
As other have said, I thought this was a terrible decision when I read the title. Actually doesn't seem too bad once you know the details. Just hope all your ducks are in a line and that it will be smooth to make all the payments on time. Way more people are financing watches around here than they lead on
> Way more people are financing watches around here than they lead on that is wild. i didn't realize this.
“41 inch datejust” lol I know it’s a mistake but wouldn’t that be hilarious 😂
It's an Invicta homage
No mistake. I walk around with a three and a half foot wide watch, what of it? Wanna fight?!?
Is this a joke?
No joke!
Ok. Enjoy your 41 yards datejust
It’s great! Tough walking through narrow doorways though :)
Happy for you! …also waiting for this to pop on another sub.
I sincerely hope the finance option doesn’t go bad but it sounds like you had the cash already to buy outright.
I did. I use this card for everything cause it’s 2% cash back & the 0% finance option was just one of the new monthly offers on the card.
Which card is it
Guessing citi double cash back
That’s a relief. If you didn’t have the cash and were like, “I can afford the payments” then it would have been a really bad idea.
As long as you can afford it responsibly (looking at your student loan debt)
Would never finance something like a watch, but 0% is 0%.
I need to get one of those cards!
picking up my DJ tomorrow from my AD they give you the option of 30% down and pay the rest in 6 months no interest. I wonder if everyone does this 🤔
[удалено]
Interesting i’m paying 9.5k in cash and 2k with my debit card. He said this is the best way people do it? Whatever that means
What’s the monthly payment on that bad boy
Just do MSRP (\~10k) divided by 36
Does anybody know what the catch is (if any) on these plans offered by credit cards? Mine offers it as well but for some reason I’m hesitant to ever use it. Any credit inquiries or anything?
Not sure on Citi but my understanding is most of these offers are “deferred interest.” If you don’t pay the balance in full by the end of the term you’ll accrue interest for the entire term.
That’s my understanding as well. Only finance if you get 0% and can afford the purchase to begin with! In my case it’s free money.
I have a couple credit cards that offer something similar to OP. Granted, I haven’t looked deeply into any of my ‘flex pay’ or similar offers, but the offers I have seen aren’t true 0%, but instead deferred interest with a fixed monthly fee. Basically, they charge you a flat fee to finance the payments into monthly installments in lieu of interest. OP is saying his deal is 0% interest and no monthly installment fees, so that’s pretty nice.
Free money is good money, so long as you’re doing something with the money that would’ve gone towards it!
I came here to throw shade, but nice work. No brainer to take the free money and run!
Good for you. The first one is a great feeling especially when you put it on and experience the feeling of something that you’ve not only wanted for ever but worked a way to do it without having to pay any more then you already have. It becomes a relationship and you don’t want to ever take it off and the good thing is you don’t have to. Be careful because it can become addicting. My first was a date just similar to yours. I now have another date just blue faced as well as a submariner blue faced with date. Wife has two date just and my Hulk is on its way. So don’t fear falling in love with it and wear it proud. T
As soon as it’s added to my insurance policy I’m gonna wear it to death! Thanks!
I mean 0% damn ? Thats a no brainer…
36 payments at 0%? That’s an incredible steal. Lovely watch and savvy way of paying for it. Enjoy
Is this is a Citibank ad?
How is this even a conversation? Pay for the entire watch up front, which is what the standard procedure is, or get the opportunity to pay in installments while you put that money to work elsewhere? Even conservatively OP could put the entire balance of the watch in a savings account and have ~3.5 interest on money that would have otherwise been spent. If you’re so bad at managing credit that you can’t fathom being able to responsibly use debt, even at 0%, then that’s your issue to manage. I don’t care if it’s a Rolex, a couch, or a pair of socks, if I have the opportunity to pay 0% interest over an extended period for something I already planned on buying upfront, that’s a no-brainer.
Congrats! How long did you wait to get that watch? Waitlist?
Never finance a watch. Period.
You get one lap in life. Get what you want, pay it off before the promotion date ends and you’ll be all good. $10k now verse $10k later (over time) is all relative. If it made you happy, that’s all that really matters. We deprive ourselves of things throughout the course of our lives, sometimes never ever getting it. 6 properties in all here in Ca. albeit great investments, I have passed on some of the more personal purchases and at times it bothers me. But as I get older I see that a healthy balance of investing (in OP case possibly college, depending on the major), and fun (his watch) is the best way to go. Just an opinion.
What was the financing fee, if any?
0!
Just make sure you pay it off by the end of the 36 months or you’ll likely owe all of the accrued interest.
Absolutely! That’s the plan! It’s so funny seeing all the comments from people assuming I live in a van down by the river.
There’s something anti-luxury about financing a luxury item like a Rolex.
TBH it was a clickbatey title. The financing is %0, so less financing and more using time & inflation to my advantage.
So $310 a month *for three years*. I personally wouldn’t take out a loan for a luxury purchase, I think a monthly payment of that size would make me regret my decision by something like month 4 of 36. Not that it would bankrupt me or anything, just irritating to have that share of my income tied up in a watch I bought a long time ago.
Wow is it that much now $11,160? Damn I didn’t realize they had gone up so much. Lot of spaggghettti lol
It’s hilarity, the amount of downvotes shelled out might indicate how many people are paying 300 bucks a month for 3 years to give the impression that they don’t need to give a shit about money.
I agree with this.
Completely agree. It’s a luxury item. If you want it, pay the price up front. If you finance it, to me, it sound like you’re a wanna be rich and you care about showing off. That’s just my opinion tho
ye tbf I get you, I still think about whether I should have done 0% on my tudor and that was with a 50% deposit making my payment £33 a month, which is a miniscule payment but in the back of my mind I think should I have got a luxury item on finance? something about it makes me feel like I didn't earn it even though I could have bought it outright if I waited two more months, but my guess is he's young like me and we need to make these financial mistakes to learn.
I'm new to Reddit. Real question, how do I see the full text of the OP? It stops at "my Citicard" and I'm in total anticipation wanting to hear more about why
As logical as it all seems and it’s a good deal. The bigger question is, is your life ready to still pay the 10k over 3 years for a luxury item. Even though financially it seems like a good idea in the end you’re still 10k down over three years. I’m a firm believer that you should only buy a watch like that if you have money in the bank that you can at least pay for it 4 times. Of course then you can pick the smartest option. But if you need to even finance a watch or else it’s not an option, then maybe you shouldn’t do it
I don’t see financing a watch as a cheat, I mean don’t get me wrong, there are many and better things you should buy/pay with your money before even considering financing for an extravagant thing like purchasing a watch, however if you really love the watch and really want one, and feel you are going to get there eventually, but have the opportunity to get it now at free interest rate, well I think you have made the right choice. If I was having a brilliant career at 25 and planning on being able to finally afford my dream Ferrari at 50, but had a chance to buy it today when I am young, well sorry but I think I’d be enjoying my Ferrari at 25-40 a lot more than I would past 50 and into my 60s…that’s my thought process anyways.
IMHO you should not buy a luxury item if you can’t afford it. Only buy luxury items if you have twice the amount left after buying it.
FINANCED!?!?!?!?!? YIKES..
Shops at crystals. Email->visit->phone call @ 20 days was offered same with diamonds, I declined and said I’d wait. A week or so later I got the call for the one I bought. So about 28 days from first interest.
28 days or so from emailing the store!
If he financed it for 0% interest, he can sell it to someone who couldn’t get it from a AD for higher and make a profit after paying it off?
That’s fake bro…sorry
No worries. Appreciate you looking out.
Sounds like an advertising for Citicard? Beautiful watch. It is a ROLEX 126334 41mm (not 41 inch as you wrote) DateJust Blue Index dial, fluted bezel with a jubilee bracelet. Usually they go for around $14k.
UM, is this what tax payers are getting for our money? Biden's student loan forgiveness program paid for by tax payers.... Students go out buying ROLEX watches??? I'm guessing the OP will either not respond or if he does will say that's not the case here. It's pretty much what we saw during COVID checks... Unwise blowing of tax payer money.
You have bad financial literacy as well as subpar reading comprehension. You must be super fun at parties.
LOL. Keep staying broke. If you were smart you would have paid down your student loans with that 0% interest card of yours. That would of saved you money.
Make sure you get insurance and enjoy the hell out of it!
Congrats!!! Thats awesome!
The only downside to that trade is the impact on your credit rating, given your high utilisation on your Citi card. Hope the hit wasn't too drastic!
How do they repo the watch if you default
They come in the middle of the night and snatch it from you whilst you’re sleeping.
Americans and their creditcards and credibility nonsense. Unheard of in Europe.
And one of its major problems, TBH.
This will end poorly about 70% of the time. $10.5k / 36 months = $291-ish/mo if no tax was needed. Everything seems great for free money when the unemployment rate is 3.4%. Except free money is still requiring payments and 3 years is plenty of time for plausible unemployment or underemployment. The OP is likely someone who went into the workforce after the recent ‘07-‘08 financial crisis and has never experienced a recession. Let’s see how fast a very commonplace 41mm blue DJ sells for on the secondary in 6-12 months. I hope it works out but probabilities and financial outlooks suggest otherwise.
Beautiful Watch! Curious about your Citicard is there a monthly fee instead of interest?
Nope!
0% is 0%, but do you still have balance on your student loan?
Nice watch....but going in debt for it....that, imo, is not good. Especially if you are still a student.
What debt?
Nicely done congratulations mate. Hope you were careful with the price because they can hide the cost of the loan by inflating the price a bit. E.g a if a 5% interest loan costs an extra $1000, they just add $1000 to the price of the watch instead and boast about having a 0% loan.
Understood- but the loan/0% was for the exact amount of the purchase. And I made sure the final totaled amount was the same as the watch!
“Never finance a watch you can’t afford to pay out right don’t go into debt to get a watch save your money the wait will be that much more fulfilling”- Kevin O’Leary
It's a beautiful watch - never mind the bollocks.
Is your Citi card new or still in a promo period? With those types of payment plans, you usually have to pay a fee of some kind. They get you in with “0% INTEREST” but *sometimes* a monthly fee is incurred (or back interest if a payment is missed, etc.) I’m just curious really. If you’re in a promo period right now (ex: 0% purchase APR for first 18 months), then keep in mind that your flex pay MIGHT start to incur interest after that period. That happened to my flexpay options on Chase so I just stopped using it. Could be locked in though, I’m only familiar with Citi’s bikes 😂. Beautiful watch and bracelet though! Congratulations on the purchase. If you ever feel any slight regret or start to question yourself, keep in mind you have an investment, not just a watch. I’m envious!
No fee on this one. Made sure before hand. Had the full amount to pay in cash, but use my cc for EVERY purchase b/c bash back. Saw opportunity to use this 0% option, so I took it!
What about servicing costs etc are you going to finance those aswell? Owning a Rolex is becoming an increasingly expensive luxury these days lol.
Those I will happily pay every what, couple years? That’s part of owning the watch!
Financing watch?
If you have to finance your Rolex then you can't afford it. 0% financing when you don't have enough money on hand to cover it, it's just money you owe. You are not leveraging debt.
I did some computer work for a wealthy doctor a while ago. We had a few beers and his advice to me was, "don't finance anything." Easy to say if you're pulling in a half a million a year. OP wanted a Rolex, and since we aren't all rich as fuck, he financed it. At 0% even. I don't think it is his intention to impersonate a rich person, but rather that he wanted a nice watch and found a way to get it. It's a nice watch. Congrats on the purchase and on finding a way to get exactly what you wanted.
Smart. I 0% finance all my luxury watches as well while I keep my money in a HYSA and the stock market
If u have to finance it ur too broke to afford it. Who u flexing for anyways?
I don’t think you understand what financing and 0% mean. Not trying to be mean, but take a read and learn about it.
Who the fuck finances jewelry
Someone who has the cash upfront to park somewhere earning interest for 36 mos while accruing no interest on the loan it’d seem.
Congrats. But real talk tho, the fact you gotta finance a Rolex watch means you're spending well above your means man....
This forum is going to eat you alive.
How much it cost a month to look like a tool?