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Analyzing Major Purchases

If you’re contemplating a big buy, spend a few minutes with the Major Purchase Worksheet on the following page to help you decide if you’re making a smart move or a bad one.

Major Purchase Considerations

    1. Purchase being considered
    2. How will you pay for the purchase?
      • Financing
      • Cash

Financing Analysis

  1. Length of loan
  2. Interest rate
  3. Monthly payment
  4. Purchase price
  5. Total interest expense over life of the loan
  6. Total cost

Cash Analysis

Other potential uses for cash if not used for this purpose?

Now ask yourself, Does this purchase still seem attractive?