> It wasn't easy, but a few decades ago, we decided that if we couldn't afford it, we didn't buy it. If you go into debt, you have to pay interest, and if you don't get out quickly, you pay interest on interest. We don't buy a new car very often, but when we do, we pay cash. It cuts the cost by thousands.

I wholeheartedly agree with your opening sentence, but by the time you get to the last one I've quoted above, I wholeheartedly disagree. If you bought a car with cash recently, it probably *cost* you thousands.

These days, it's not difficult to get a lower financing rate than you can make in an investment somewhere. You might have to wait for the right time of year, when car dealers get the new models in and are desperate to make room on their lots. You also might have to negotiate the rate. A dealership might convey the impression that the rate they offer is a standard, fixed thing, but the second you say you'd prefer to finance with your own bank instead of them, they'll fall over themselves to sweeten the deal.

We have our car financed at 2.9%. We could have paid cash, but then we wouldn't have that cash to invest in accounts that return two, three, or four times that interest rate. If you can invest money at a 6% return, and you're paying cash for a car instead of investing it at a 3% interest rate, you've just lost thousands of dollars in the long run.

Certainly, though, I agree with the sentiment, that you shouldn't buy anything you can't afford if you can possibly help it. But this isn't the same as a blanket rule that you shouldn't ever finance anything.