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Financing an iMac

The only way I'd ever finance a computer or other expensive piece of consumer electronics is if I can get 0% interest and know I will pay it off during the initial loan period (so I never get hit with finance charges)....and even then with rates on savings/money markets what they are today you're only earning a couple dollars in the year the loan is active with your "free money". Is it worth the hassle? Up to you....I guess it would help your credit score if you need the help.
 
Nothing wrong with financing if you can get the Barclays card at 0%. I was approved for $7000 and bought my iMac BTO and MacBook Air with it a few weeks ago. It will be payed off by November so interest isn't even a thought in my head. Why not get help your credit and get some toys at the same time? Just make sure you can pay it off early and life will be good. Don't listen to the people that say "only pay with cash". If you are young, you need trade lines and credit history to buy that house. I've financed many things since I was 18 years old, and was able to buy a nice house in a nice neighborhood with a tier 1 interest rate two years ago. With good credit, I was able to buy a house that cost about $200,000 more than if I had no credit or bad credit. Credit can treat you well if you treat it well! Unless you are rich, you will need credit at some point in your life. Heck, my wife's best friend is married to a Pittsburg Steeler offensive lineman and his credit was so bad when he first got into the league, that he had to put down almost half on a 2 million dollar house in Calabasas. Credit is important no matter what your financial situation.
 
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For me I bought mine on a personal loan through the bank with a loan period of 7 years but I made lots of extra payments which reduced it to 6 weeks thus the total amount of interest was around $60 by the end. The other option is taking advantage of interest free deals but remember to pay it back as fast as possible even when there is no interest - less debt, less stress, less worry about carrying debt in an uncertain climate like what exists today.
 
I think it would be better to save up to purchase electronics rather than finance. You should only finance larger purchases that retain value rather than an item like an iMac that will drop in value with every new release.
 
I would go with the deferred interest with Barclaycard since they are now offering up to 18 months, back in November they only offered 12 months. I paid off my iMac yesterday, I had the money just didn't want to part with it right away. Just do not miss a payment because their interest rate is 22.9% or 23.9%....they're friggen loan sharks!
 
There's a whole bunch of people on here who seem to have no clue about the cost of money and what that means.

If you pay cash, you are not getting a return on your capital that you would be getting if you had held on to your cash and invested it somewhere. This is just as valid a "loss" as paying interest if you finance. The question is which loss is the larger. But paying cash is not pain free.

I owe a very significant amount on my mortgage, which I could pay off for cash. But since my mortgage rate is 1.5% and since I am getting more return on that on my savings, there is no point in paying it off. It pays me to owe the money.

Same with any purchase. The only things that matter are the rate and your available credit. If you can finance it for same or less than the return you can get on your own capital - and you don't need to borrow lots of money for other things - then finance it.

There's also the rainy-day argument. It's best to keep some cash for a rainy day and financing - even if you can afford to pay cash - is sometimes a good idea for this reason.
 
Chippy99 said:
There's a whole bunch of people on here who seem to have no clue about the cost of money and what that means.

If you pay cash, you are not getting a return on your capital that you would be getting if you had held on to your cash and invested it somewhere. This is just as valid a "loss" as paying interest if you finance. The question is which loss is the larger. But paying cash is not pain free.

I owe a very significant amount on my mortgage, which I could pay off for cash. But since my mortgage rate is 1.5% and since I am getting more return on that on my savings, there is no point in paying it off. It pays me to owe the money.

Same with any purchase. The only things that matter are the rate and your available credit. If you can finance it for same or less than the return you can get on your own capital - and you don't need to borrow lots of money for other things - then finance it.

There's also the rainy-day argument. It's best to keep some cash for a rainy day and financing - even if you can afford to pay cash - is sometimes a good idea for this reason.
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Bingo! My parents are one of those people who believe credit is bad and cash is the only way to go. When I showed them my rewards such as free flights, hotels, insurance on purchases, and free merchandise, while letting money sit in an account, they quickly changed their mind. There's a fine balance in the credit game and if you know how to play, it can pay.
 
Interesting Responses

I've found the responses to this thread to be quite interesting. While I certainly agree that limiting debt is extremely important and that paying interest unnecessarily is a waste of resources, I don't necessarily agree with the idea that one should never finance.

I financed my iMac via Apple (which is really through the Barclay credit card). I could have quite easily paid the entire amount out of one my bank accounts instead. So why did I finance? Simply put, I took advantage of a free (no interest) $2,500 loan from Barclay for an 18th month period. That allowed me to keep $2,500 in an interest bearing account for the same period of time while paying small monthly payments from a non-interest bearing account.

I figure that over the life of the free loan, I'll actually make between $37 and $75 in interest, depending on interest rates during that time period....so let's just go somewhere in the middle and say $50. Given that, why take money out of an interest bearing account if I can use someone else's money for free.

By the way, I came around to this way of thinking by associating with a friend who does land development for a living. He built himself up from nothing to a multi-millionaire by leveraging other people's money in smart ways. That doesn't mean it's always a good idea to borrow or take on debt. Sometimes it's a terrible idea. However, if done strategically it's how rich people get rich (only on a much larger scale than buying iMacs).
 
JHBrown said:
Bingo! My parents are one of those people who believe credit is bad and cash is the only way to go. When I showed them my rewards such as free flights, hotels, insurance on purchases, and free merchandise, while letting money sit in an account, they quickly changed their mind. There's a fine balance in the credit game and if you know how to play, it can pay.
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The flip side of that, however, is that a lot of people tend to spend money that they wouldn't otherwise spend when using a credit card.

In that case they might earn lots of rewards but have spent money they wouldn't normally have spent to get them...that makes it not really "free".
 
In the UK?

I bought my 2012 i7 iMac on Apple finance, £2k over 24 months worked out £94 a month, I think the total interest will be £250 but I plan to pay off more when I can to clear sooner.
For me this worked out the best option as I wouldn't have been able to pay £2k in one hit and the £10 interest a month doesn't even register.
Very easy to set up assuming your credit rating is decent.
 
Sodner said:
Buying your home with cash are we? I'm jealous. I had to finance mine.
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No I had a mortgage. I paid it all off by the time I was 33 though. Yes I could want a mortgage to buy another, but I'm pretty sure i'll be okay with the amount of equity I would have to put in (and to be honest I have 1 child and live in a 3 bedroom detached house. I imagine my next move will be to something smaller when she has flown the nest).
Borrowing money for a house purchase is the only exception to borrowing money IMHO. Unless you are born rich most people have to or spend their life renting (paying someone else's loan).
For everything else saving and living within your means are the solution to most financial issues.
 
peacenfunk said:
My question is how many of you have financed an iMac or a computer or thought of doing it?
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I've bought all of my Apple gear (iMacs, MBAs, iPhones, iPads, etc.) via interest-free financing either via PayPal's Bill Me Later service (which is available with the Apple Store) or the Apple Store Barclaycard (I have two accounts).

I just make sure I have paid the bill in full one month before the end of the promotional period (be it 6 months or 12 months).
 
Apple fanboy said:
Saving and living within your means are the solution to most financial issues.
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I don't want to see anyone get into financial trouble by overburdening themselves with debt.

But your statement above is too simplistic. What about living within your means (which I do), saving (which I do) and also borrowing when it's appropriate and makes sense (which I also do)?

There's nothing evil about borrowing and as I mentioned above, it is fallacy to imagine that you pay interest if you take out a loan, but no interest if you pay cash. If you pay cash, you lose the interest on the money you no longer have.

So buying things - however you finance them - means paying interest or losing interest. Either way, there's a cost of money involved.

If someone offers you interest free credit - or some similarly attractive deal - it would be madness to hand over your own cash.
 
Chippy99 said:
I don't want to see anyone get into financial trouble by overburdening themselves with debt.

But your statement above is too simplistic. What about living within your means (which I do), saving (which I do) and also borrowing when it's the appropriate thing to do (which I also do)?

There's nothing evil about borrowing and as I mentioned above, it is fallicy to imagine that you pay interest if you take out a loan, but no interest if you pay cash. If you pay cash, you lose the interest on the money you no longer have.

So buying things - however you finance them - means paying interest or losing interest. Either way, there's a cost of money involved.

If someone offers you interest free credit - or some similarly attractive deal - it would be madness to hand over your own cash.
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Well each to his own. I'm happy paying cash for the things I want. Sadly our government (and many others) thought as you do. Trouble is when the time came to pay up, we were in a recession and the money had run out. Now they are trying to cut borrowing whilst encouraging others to borrow more to keep the economy going. But apparently saving and using that money is madness!
 
Apple fanboy said:
Well each to his own. I'm happy paying cash for the things I want. Sadly our government (and many others) thought as you do. Trouble is when the time came to pay up, we were in a recession and the money had run out. Now they are trying to cut borrowing whilst encouraging others to borrow more to keep the economy going. But apparently saving and using that money is madness!
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Not at all. The government borrowed money we didn't have. I am talking about borrowing money when you do have it.

If you have £2,000 in cash to buy a new iMac and someone offers you interest free for 12 months, there can be little financial justification for handing over your cash. You could keep your cash, stick in an account somewhere and get perhaps £60 back in interest. Or you could buy £2,000's worth of premium bonds and maybe get a big win.

And you would have the benefit of having the £2,000 available to you, should an unexpected emergency crop up.

Handing your money over in these circumstances is not rational.
 
Chippy99 said:
Not at all. The government borrowed money we didn't have. I am talking about borrowing money when you do have it.

If you have £2,000 in cash to buy a new iMac and someone offers you interest free for 12 months, there can be little financial justification for handing over your cash. You could keep your cash, stick in an account somewhere and get perhaps £60 back in interest. Or you could buy £2,000's worth of premium bonds and maybe get a big win.

And you would have the benefit of having the £2,000 available to you, should an unexpected emergency crop up.

Handing your money over in these circumstances is not rational.
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But you're eliminating risk from your equation which is also not rational.

That money you invest could also lose value in X investment, meaning you owe money and now have less than you started with. You also most likely aren't going to make much if anything on a 12 month investment.
 
Chippy99 said:
And you would have the benefit of having the £2,000 available to you, should an unexpected emergency crop up.

Handing your money over in these circumstances is not rational.
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What if your emergency crops up just before the free interest ends?

Personally I would never spend £2k on a Mac unless I had say at least £4k.
 
peacenfunk said:
I've had my current laptop now for about 5 years. In the tech world it's a very long time. But now I want to make the jump and get an iMac. I have recently thought about financing one. I could save. I earn enough that after bills and what-not i could get it within the next few months. Also have an iPad mini. Recently i bought a DSLR as photography is a passion I am able to fulfill and hopefully turn it into a career.

My question is how many of you have financed an iMac or a computer or thought of doing it?

Thanks
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I did the 18mo 0% from Barclay. Just make sure you divide the amount owed by the term. Barclay's only has a mid-$20 payment due every month.

Which DSLR did you get?
 
Nah, put it on credit! Be a good consumer!! :rolleyes:

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JHBrown said:
Nothing wrong with financing if you can get the Barclays card at 0%. I was approved for $7000 and bought my iMac BTO and MacBook Air with it a few weeks ago. It will be payed off by November so interest isn't even a thought in my head. Why not get help your credit and get some toys at the same time? Just make sure you can pay it off early and life will be good. Don't listen to the people that say "only pay with cash". If you are young, you need trade lines and credit history to buy that house. I've financed many things since I was 18 years old, and was able to buy a nice house in a nice neighborhood with a tier 1 interest rate two years ago. With good credit, I was able to buy a house that cost about $200,000 more than if I had no credit or bad credit. Credit can treat you well if you treat it well! Unless you are rich, you will need credit at some point in your life. Heck, my wife's best friend is married to a Pittsburg Steeler offensive lineman and his credit was so bad when he first got into the league, that he had to put down almost half on a 2 million dollar house in Calabasas. Credit is important no matter what your financial situation.
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I really hope you don't charge for your financial advice...the ENTIRE credit system is collapsing and you talk about how important it is. Open your eyes.
 
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