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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.
Agreed. Leasing is very common. New car every 2-3 years, but nothing to show for it after the lease ends. It's part of the "immediate gratification" mentality. I'm not a fan myself.
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.
Sometimes people do not know the value of older luxury cars and they think that just because its a BMW, Audi or Mercedes that its worth a lot of money. These brands really depreciate in value and can be had at a good price just because they are the outgoing model. A newer Camry can be worth more than a comparable outgoing model luxury car.
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.
Not all are leases.
When I was a tech it was crazy to see luxury cars that were a few years old with the cheapest off brand junk tires installed and a Jiffy Lube oil filter change sticker. The only reason it rolled into are shop was apparently you can't some (insert obscure part here) at Autozone.
A perfect example was gas springs on a Rolls Royce.
Today's cars can last a long time. Once upon a time, people seemed to buy a new car every three years or so. And back then, when a car had about 100,000 miles, it was more or less shot. Today, cars are much better and can last a long time. 100,000 miles is nothing. Anyway, if you spend $50K on a car but it lasts 10 years or more without much maintenance, that's not such a bad ideal.
As for people buying expensive luxury cars? I guess it makes them feel better. Then again, some people have a lot of money, so for them, it might be a small expense.
I've been toying with the idea of buying a new Corvette. They look like fun and I'd like to take a road trip around the country. One the one hand, I realize that $70K is a lot of money and that spending that much on a car is not only unnecessary, but stupid. On the other hand, it's not like I get to live forever. I still haven't decided.
Never saw that 25 years ago. Back then if you saw someone driving a new Mercedes you knew they were well off!
False Premise.
I worked on those cars 25 years ago, and a lot of those cars were sold to folk who were financed to the hilt back then. Or they were leased cars where their cash flow could handle the payment.
Either way, you DIDN'T know if they were well off.
Maybe it’s just me, but I’d think someone’s financial house is in disorder if they’re buying an $80k vehicle at that income level. There’s not a luxury car out there that won’t see its value halved after three years.
There's a lot of people racing towards retirement broke, but hey they looked good getting there.
I rather spend money on other things.
Depends on a lot of factors. If you don't have any debt to speak of, and it's just disposable income, then you can easily afford it. But you said it yourself... you'd rather spend it on other things. So if you're spending $15k for a vacation every couple years for example, that's no different than someone who spends big on an automobile purchase because they like cars.
And frankly, spending a lot of money on a vacation is fun, but after you get home, you've only memories and pictures. At least buying a car you've managed to keep some of your investment.
There are ways to have a "prestige" car on under $100k/year income without killing retirement savings or living in perpetual debt. But those who Can do this also don't, which is how they got into the position in the first place.
As for the majority? paycheck to paycheck, coating by on fumes more months than not and zero savings.
I could afford a "prestige" car and pay cash for it but I garner my sense of personal prestige from being debt free and having the choice to retire early in the future. Therefore my money will be working for me rather than being blown on a prestige car so that I can reach those goals before the age of 50.
I could afford a "prestige" car and pay cash for it but I garner my sense of personal prestige from being debt free and having the choice to retire early in the future. Therefore my money will be working for me rather than being blown on a prestige car so that I can reach those goals before the age of 50.
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.
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.
Judge much?
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