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Don't forget, it doesn't always work that way. On at least a few occasions, I've done the right thing and "invested" money in certain stocks, only to see it all go down the drain very quickly. I would have been much better off buying myself a Ferrari. At least I'd still have the car the following year. With the stock, all I got was a tax loss carry-forward.
I am not heavily into individual stocks but my money is spread out between dividend generating mutual funds, certificates of deposit and bonds. I could see certain scenarios where vehicles could be of greater benefit.
a truck for its utility
a hybrid to use on the side for Uber
a rare high-end classic that at least retains its value
I would never make the decision to have a higher end BMW, Audi or Mercedes as an all around and commuter vehicle. It does not make financial sense.
Most middle class folks driving such fancy cars are probably leasing them. Enjoy the status symbol and look cool for 3 yrs, then dump the car for another one.
Yes!
As you go up the food chain in the price of cars, the percentage of them that is leased--rather than purchased--increases.
Just because somebody is driving a luxury car, that does not necessarily mean that the driver bought the car.
I have an old acquaintance from my high school days who has a really pernicious addiction to gambling.
My mortgage is paid off, I have an investment account in the six figures, I own a very nice home on a 2/3 acre lot, and I owe no money to anyone. By contrast, he lives in a crappy rental apartment in a dicey area, despite having an income that is actually higher than mine.
However, every 3 years, he leases a new Cadillac--which he can ill afford, in view of his consistent gambling debts. When I pointed out the obvious (that leasing is the most expensive way to possess a vehicle, with no "return" at the end of the lease), he said, Yeah, but when I pull up in front of the casino in that Caddy, it really impresses the doorman!
Sometimes, it is impossible to save people from their own bad decisions.
Last edited by Retriever; 10-17-2015 at 03:59 PM..
Marketing, making people believe what they appear to be is more important, a status symbol.
this.
most every luxury car you see these days is a lease. Most of these folks can't afford the car otherwise.
Marketing is probably one of the worst things to be invented. They can screw up people's view of themselves and even make them vote for someone they shouldn't
Hopefully somebody didn't mention this already, but what's wrong with a luxury car in the Target parking lot? Target has everyday stuff that everybody needs at good prices. Just because someone likes and can afford a luxury car doesn't mean they buy groceries strictly at Whole Foods. But I'm nitpicking...
I'm the "drive it until the wheels fall off" kind of guy, so I don't see the point... On one hand, I don't really care so long as they don't make the rest of us cover their asses if and when they go broke, retire with no money, etc... On the other hand, watching the majority of my millennial peers not worry about saving, whining that they don't have "free" healthcare, and racking up monstrous amounts of debt tells me that they WILL make the rest of us cover their asses at some point.
I think the things that used to be more common sense (or so I'm told) like saving for retirement and having a buffer in case of emergency, unemployment, or the like aren't being practiced as much today, so people think they can afford a fancy car. That's my theory anyway.
Amazing how many 50k+ vehicles I see parked in middle class neighborhoods, and Q7s parked in the lot at Target. Never saw that 25 years ago. Back then if you saw someone driving a new Mercedes you knew they were well off!
Do all these people finance everything to the hilt? I would think the last thing you would want to own if you had any sort of debt whatsoever would be a luxury car.
Well, Target wasn't in my area 25 years ago so I can't say I agree or disagree.
There's a cheap Mercedes now. And $50K doesn't by a high end luxury vehicle today. Many of us have car loans. So what of it? Yeah, I drive a vehicle that was over $50K. I traded in a vehicle. I have a car loan. It's not a luxury car. Yes, it has perks. I also spend a great deal of time in my SUV and need some of those functions for my job.
They watch a lot of mindless materialistic reality shows on the tube where everyone has a mini mansion and a high end bling mobile. I imagine many of them spend every dime they make and more. A lot of people who are really wealthy are frugal and don't spend just to show off.
When our kids were young, we financed a family vehicle for thirty-six months. My husband and I continued to share that car for an additional thirteen years, putting aside what we had been paying for the loan into a maintenance & replacement fund. The car turned out to be very reliable and needed little in the way of repairs. Last year, we decided to turn the sedan over to one of our kids and buy a nice new car for ourselves, using the money we had aside for the previous thirteen years. It bought a pretty nice vehicle, and I don't regret the expense one bit. We have all our bases covered, so why not? But it tickles me that you would assume I can't afford it if you saw me at Target loading TP into the trunk.
Marketing, making people believe what they appear to be is more important, a status symbol.
It really is. My college age nephew lived with us for a year, and it soon became evident to me that he viewed his entire world in terms of brand loyalties. He was a perfectly conditioned consumer cadet, his world view and self-image alike shaped by marketing. He asked if he could paint the Nike logo on our guest room wall, for Christ's sake. (I told him that if he wrote any such obscenity on the walls in our house, he and his stuff would be out on the curb looking for a new place to live.)
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