And no, you cannot take the $25,000 and buy a car. It’s hypothetical and an either/or. $25,000 cash to do what you want with (except buy a car) or a brand new $25,000 car that you cannot sell? Which would you choose?
The reason I ask is because I had this exact conversation the other day with a friend and both of us said to take the $25,000. Why? Because how often do you get handed $25,000 in cash, tax free, to do what you want with? It is a down payment on that house you want, it’s a huge deposit into a retirement account to help you play catch up, it’s some money to start that business with…it’s yours to do anything you want with OTHER than to buy a car with. Also, almost anyone can finance a clunker of a car, so getting wheels is not that difficult. But getting your hands on $25,000 cash can be a rather tough thing to do.
So what would you do? I am curious about what the readers think about this question, as I want to understand how they would react if asked an either/or question about money.