When I first decided to write about this particular topic the first thing that came to my mind was this video clip as funny as it may seem. Me and one of my friends would always tease each other saying " you smoke crack don't cha?" every time either of us would do OR say something extremely silly or stupid.
This is exactly how I feel about car debt, its like killing yourself REALLY! Recently I was talking to a co worker and she was explaining to me that she just found out her ex husband has a car lease on a lexus for 700 dollars a month and bounces checks on a monthly basis. For one how does she know so much about an ex lol and two how in the world do you pay $700 a month for a car! Talk about insanity doubled over!
Now don't get me wrong I am a fan of nice cars or even new cars for that matter WHEN YOU HAVE THE CASH. I drove around in stupid for 2 years before stupid caught me and repossessed my "nice car" After that time of embarrassment and pain, I decided I would never have a car payment again. Check out what Dave says about buying new cars..
Buying a new car is not something 98% of the people out there need to be doing. It is a luxury item. Only buy a new car if you're filthy rich. The money saved by buying a used car is because of depreciation (the loss of the financial value of an object due to its use). Used cars have already depreciated (60% to 70% in the first five years). Buying used allows the person who bought the car when it was new to eat the cost of the depreciation. Then the person who buys the car used can get a great car for much less than the new wholesale prices.
Say you are looking into financing a sports car with payments of $400 per month. The car that you are driving now is worth around $1,500. If you take that $400 and pay yourself instead of paying it to the dealer, you will save $4,000 in 10 months. You will have $1,500 from selling your old car, so you will be able to buy a $5,500 car just 10 months from now. Continue doing that for another 10 months and you will be able to buy yourself a $10,000 car. That is only 20 months away. You can do it!
There are alternatives to buying new. Used lots are overflowing, and millions of cars come from expired leases. If you want to know what used cars are selling for these days, look online at the following sites:
Also, call some of the banks in your area and ask them how they dispose of their repossessions. If they have a repo auction in your area, this is a great way to find good deals. But the best deals you can find are usually from individuals because they are trying to get rid of their vehicles. Look in your area papers and find what's for sale. No car fever! Go take a cold shower! No new car!
So what are your thoughts on new cars?