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Like everything you need to buy carefully. I have always bought used cars known for their reliability and cost to maintain. You can buy a new car and have it break down just as much. I have saved well over $200 k over the years in car purchases and insurance costs.
I just bought a 2014 Lexus ls460 for $31k with 54k miles. Runs like new. New it would have been $100k
I took that money I saved and will buy another rental property with cash left over that will cash flow enough to cover the payments on the 2014. In 5 years the car will be paid off and I get the cash flow.
If you,did this with just 3 cars you could have have a lifetime rental cash flow of $1500 a month.
New car that loses value quickly vs a like new solid luxury car that is reliable and $1500 a month income for life?
You can keep your new car and stereotype of what a used car is. Me, I'll just retire earlier than you.
I laugh when people tell me how rich I am driving a Lexus when in fact I spent less than they did on their fast depreciation new cars.
You can post a photo of your canned green bean casserole on Thangiving. I'll post a photo of the tropical paradise I am taking the bus to, for 4.50 USD.
Location: Formerly Pleasanton Ca, now in Marietta Ga
10,351 posts, read 8,569,440 times
Reputation: 16698
Quote:
Originally Posted by Hal Roach
You can post a photo of your canned green bean casserole on Thangiving. I'll post a photo of the tropical paradise I am taking the bus to, for 4.50 USD.
What are you even talking about?
Never heard of green bean casserole, perhaps a favorite of yours you'd like to share?
It certainly does make a difference on what car you get. What car did you get?
My cousins father bought a used Prius with over 70K miles and about 3 years old for about 15 percent less then buying a new one. That didn't make any sense at all.
I know a guy that took Dave's advice and bought a four year old Corolla from a dealer. A month later, the key broke off in the ignition...cost him 950 to fix. Cars have way too much proprietary electro ics that can be quite difficult to diagnose and fix. General Motors has kept more people down. than the Liberals. I can take the bus, subway, ferry boat, taxi, or walk...with a paid for home, a car would cost more than I spend on everything else, combined. I have enjoyed listening to Dave, before, but most of the callers have strong income and weak brains. Never heard him once advocate living in a walkable area and going without a car. A smaller house on a valuable lot is where the value is. Drive till you qualify fueled the last housing boom, but they also required huge auto expenses that they would never get back...even if oil went to thirty bucks per barrel. The home values in the exhurbs were the first to fall and the last to bounce back..granite countertops and all....
We recently moved out on an "Ex-urb". One of the extreme commuter suburbs, a two hour+ drive from NYC. The market there collapsed in 2008 and never recovered to any significant extent. After we left the area a friend bought a bank owned, totally flipped (new interior finishes, new HVAC, etc...) house, that was built just before the collapse. It's a 2700 ft. 4/3/3 that first sold for high $300s. It sits on 1.75 acres in a nice neighborhood. They paid the bank about half of the original purchase price.
Location: Formerly NYC by week; ATL by weekend...now Rio bi annually and ATL bi annually
1,522 posts, read 2,244,294 times
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Quote:
Originally Posted by Hal Roach
the used car is a gamble, at best. A few weeks ago, a woman was standing in front of her KIA on a freeway flyover, broken down, someone hit the car, and sent her plunging to her death. I wonder if it was certified pre-owned. A 20 year old Tahoe....an absolute piece of junk. Transmission? 5000. Air conditioning 3000. Tires 200 each...leaking fluids all over the place? priceless.
Never heard Dave comment on what size houses people think they need...really dumb, and a good way to get a terrible location. Five in a bungalow would be tough...but you could easily fit in a townhouse in a much better location than a mcmansion. Average new home in the UK is 780 sf, Japan is 570..
Dude the crate engine brand new for a 199 tahoe is 1700. A 4l60E tranny $5K?? Where? Thats less than a grand rebuilt. Thats like $2800. Used car gable is absolutely a good one but first, you have to know what you are talking about........
Dave consistently talks about housing and prices....
Location: Formerly NYC by week; ATL by weekend...now Rio bi annually and ATL bi annually
1,522 posts, read 2,244,294 times
Reputation: 1041
Quote:
Originally Posted by City Guy997S
A. You wouldn't spend 8K repairing a 20 year old Tahoe
B. You could replace the motor and transmission and a/c for less than 5000 total (using used parts) so not sure where you could spend 5K on a transmission alone.
C. 20 yr old Tahoe would have 15 or 16 inch tires, you can buy Goodyear wranglers brand new for $95 a tire for a 97 Tahoe.
GM used SUV are garbage. A farmer friend used to buy a new one every two years as his farm car...they all had major stuff wrong at trade in time. His farm is worth much more than 8 figures, so he can afford it and knew the dealer, but he would never have owned one out of warranty. Try living in 120 degree heat sometime, and see how well your used Michigan piece of scrap does in the heat, if it will even start. Same for those Impalas..had one at work....probably depreciated half in two years....terrible design, terrible electronics.
I bought a 9 year old car, a GM at that, not a "super reliable Honda or Toyota" in 2010 for $5,000 out the door. It only had just over 20,000 miles on it. All I've had to do is general maintenance such as brake pads and rotors, tires, oil and fluid changes and a few other things such as a new ignition switch and maybe a few lightbulbs and a resistor for the fan. Otherwise I've gotten up to 140,000 miles+ and that's all it's needed. Unfortunately it now needs a transmission rebuild, which exceeds the value of the car most likely.
BUT for 9 years at $5,000 I'd definitely say a $5000 used car can last you a long time, if you get the right one.
I was able to save money during those 9 years to where I can get another used but nicer car this time, and not have a car payment. I plan to go $15-20,000 this time and get a newer car, maybe 3-4 years old with more features. Hopefully keep it for just as long. I could spend much more than that and also not have a car payment, but I choose not to because there are more important things in life to me.
I think the biggest thing is people buy more car than they really need to impress or fit in with others or possibly to fulfill some deep down need they have. Plus we tend to get bored with what we have after a while and want to get something different or upgrade to newer and flashier.
Dave Ramseys only real problem in my opinion is that he has one way, his way, and any divergence from that is very wrong in his opinion. The majority of his advice is great and the point of his financial lifestyle is to mitigate risk, especially for people who have issues with debt and/or are perpetually low income. For people who have a desire to understand more about how financial systems work and grow their business or assets in other ways, there are ways to use debt to increase net worth or income, but of course there is risk attached to that. Just take a glimpse at the successful businesses in this country, the vast majority have used debt in one way or another to get where they are, but again, with debt comes risk.
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