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So true. The person who drives a car into the ground, might spend hundreds of dollars a month in model trains, guns, or some other hobby. They shift the money from their car to their hobby. People with less or no hobbies maybe can justify buying a new car often and getting the top trim.
Also, I think there is a sense of pride of buying a car and having it last forever like "look what I did. Not too many people do this anymore".
I guess my other hobby is paying off student loans
That's a good point, though. Some people value their cars more than others. My sister really just doesn't like anything that's "used", it gives her bad juju or something. She leases a new car every couple years and even had a new construction house built. She certainly spends more to do this, but she really values having new things. Meanwhile I'm "proud" of driving cars that are over 10 years old and changing my own oil and what not, and I think my early 1950s house is just a tad on the "too new" side for my tastes.
Cars are a horrible “investment.” I bought my first car used, and my SUV used, and my MINI used, but my last car I bought new because it was a special edition car. Still only $30,000. And if I’m buying used when my net worth is way over $1M, you gotta be doing something wrong buying new if you’re struggling to put $10K into checking lol. It’s just a horrible waste of money to buy cars new. Heck buying used is still usually painful when you go to sell. I hate cars, I can’t think of anything else where I’ve flat out lost as much money even buying used and selling down the road. Cars are a true money sink.
So true. The person who drives a car into the ground, might spend hundreds of dollars a month in model trains, guns, or some other hobby. They shift the money from their car to their hobby. People with less or no hobbies maybe can justify buying a new car often and getting the top trim.
Also, I think there is a sense of pride of buying a car and having it last forever like "look what I did. Not too many people do this anymore".
By far the worst thing about cars is that they tank in value hard if you buy them new. Other hobbies like guns, watches, coins or bullion are not nearly as rough if you like to flip stuff. Of course some guys go way overboard with that crap too.
Yeah that's the problem, cars basically never appreciate in value unless they're very valuable, classic models, and you don't drive them. My friend buys and sells motorcycles and guns and things like that, he usually gets more than he paid. He's really frugal (cheap lol) and he finds the best deals, then uses them for a bit, sells them for a profit, and moves on.
I've spent a ton of money on my Star Wars collection, but it has appreciated at a better rate than the stock market. I sold about 40% of the collection two years ago for $28,000. Those items I sold cost me maybe $10,000. I held most of the most valuable items, too, so whatever I sold was the tip of the iceberg. Not every hobby is a waste of money. Some can be quite lucrative. Enjoy the stuff for a while, then take a profit.
Cars are a horrible “investment.” I bought my first car used, and my SUV used, and my MINI used, but my last car I bought new because it was a special edition car.
A car is not an investment at all. It's a vehicle to get you from point A to point B because we live in a society that requires a car. .
Unless you drive a 7 figure Bugatti Veyron or Ferrari F50, your car is not an investment.
Cars are a horrible “investment.” I bought my first car used, and my SUV used, and my MINI used, but my last car I bought new because it was a special edition car. Still only $30,000. And if I’m buying used when my net worth is way over $1M, you gotta be doing something wrong buying new if you’re struggling to put $10K into checking lol. It’s just a horrible waste of money to buy cars new. Heck buying used is still usually painful when you go to sell. I hate cars, I can’t think of anything else where I’ve flat out lost as much money even buying used and selling down the road. Cars are a true money sink.
Why do you look at them as an investment? Cars are not an investment unless you are talking antiques, rarities and high end cars. The cars you see in Barrett-Jackson auctions are investments but 99% of the vehicles on the road are a means for transportation and not investments. They get you from point A to B, maybe C and D if you run multiple errands. Unless you flip cars within a year, the off the lot depreciation issue is moot.
I agree that some cars are a money sink. Especially used cars. As cars get used they need replacement parts. My used car has gone through four tires, a door cable, a headlight (a relatively small cost in all actuality) a bad tire sensor, a power window battery, an evap issue and a few misfired leading to timing readings on the check engine light. And this was all in the 15k miles I have put on it in one year, five months. Yep, I got nickeled and dimed by the used cars and others have too. Not saying you wouldn't through new cars, but it is a lower probability.
He doesn't. Hence the quotation marks " ". That implies he doesn't view a car as such, even though many other people do....or at least use the word investment, often to justify buying something they can't really afford.
Dave Ramsey has never said anything new, most is common sense that many financially responsible people have done for years before Dave Ramsey became known.
I don't agree with everything he says either. I don't agree with his credit card ideas for example. I feel he caters mostly to those who are not responsible and therefore in debt already or those with less knowledge about finances and those with spending problems to begin with. If what he advises is for those people then I do agree with the credit card and other ideas but otherwise seem silly.
Everyone knows a new vehicle will depreciate the second you leave the lot and even more within the first few years so there is major negatives to buying new. He didn't first discover this. I personally will never buy a brand new car, decided that long ago but do I think a financially stable reasonable person could buy a new car with less net worth.. yes I do. My parents bought a brand new car 7 years ago and they have much less net worth but are financially stable and have already paid it off in full. People who are responsible with their money, worked hard to earn it and are self sufficient have every right to decide how they spend it and what is important and not important to them. Everyone, again who are financially stable, has to decide what is a waste of money to them vs what they want to purchase. Vacations or buying alcohol could be a waste of money to some and not to others. If someone has the means and wants to purchase a new vechile, why shouldn't they?
I'm obviously not a Dave Ramsey follower, but I didn't even know who the guy was until 2 years ago when we got internet for the first time.
Cars are a horrible “investment.” I bought my first car used, and my SUV used, and my MINI used, but my last car I bought new because it was a special edition car. Still only $30,000. And if I’m buying used when my net worth is way over $1M, you gotta be doing something wrong buying new if you’re struggling to put $10K into checking lol. It’s just a horrible waste of money to buy cars new. Heck buying used is still usually painful when you go to sell. I hate cars, I can’t think of anything else where I’ve flat out lost as much money even buying used and selling down the road. Cars are a true money sink.
^^This is my thought exactly. And not just the cost, but the insurance, maintenance, repairs, etc.
OK, people, give him a break. That's why he used the quotation marks around the word. He doesn't look at them an investment. But other people do, often using the term "investment" (see those quote marks again!) as a rationalization to spend more than they need or can reasonably afford.
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