Blog Posts
Over the entirety of this blog, I have continued to preach the importance of buying used cars, driving these cars until their wheels fall off and always buy cars in cash. What would push me to think about getting rid of my old car? It's simply one number:
Every year, my wife and I discuss our old cars. We look at our savings, we look at how much a new car costs and the yearly expenses to keep the old car. Every time I look at this data, I always draw the same conclusion. In the long run, I am better off keeping the old car. Whether you decide to keep an old car or buy a new car, you must understand that a car is going to be a money pit. It will need gas, it will need repairs, it will even need to be washed and there is no way to avoid these extra costs.
In this country, a new car can seem like a status symbol. Lot's of people can judge you based on the type of car that you drive. I work at a school and my students can be very vain. When they find out that I have a 2005 Pontiac Grand Prix, then some of them will give me a hard time. This doesn't last long, because they realize that it doesn't bother me and that I am proud to have a ten year old car. Plus, I respond with the fact that I have that car to save many and they really don't have a comeback for that. Most of my students believe that I am cheap. I would agree with that statement, but I prefer to call it frugal. Buying a used car instead of a new car can be very beneficial.
Many people in the United States feel like that they need a brand new car. I have heard the reasons before and these reasons deal a lot with the cost of owning an older car. Statements like, "An older car will cost too much in monthly expenses," and"I don't want that car to dollar me to death." The mindset is that a older car will cost more per month than a brand new car. The issue is that most people take out a loan to buy that brand new car. Therefore, these people have traded a false sense of security for a bunch of debt payments.
The best way to win with money is to get out of debt. So, I am big on getting rid of car payments, student loans, credit card payments, and any other type of debt payments. Once you get out of debt, then you free up tons of money for saving and investing. Are car leases any different than debt?
