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Not mentioned in the article, but the average loan for a new vehicle is now 68 months as well. 66 months for used vehicles.
Sounds like a lot of people make a lot of bad decisions to me. I dont see a ton of new Mercedes and BMWs on the road, must be a lot of subprime borrowers making up the market here. Does not seem very healthy.
The cost of me missing one day of work is over $200 gross. I don't looks at my $420 / month car payment as being dumb with money ..
I look at buying that 1$200 Honda Accord, to save money foolish.. twice in the first 4 months it cost me to miss work.. the first time the battery was dead, second time the starter failed .. yippie it was paid for, but it cost me over $400 in lost wages ..
The cost of me missing one day of work is over $200 gross. I don't looks at my $420 / month car payment as being dumb with money ..
I look at buying that 1$200 Honda Accord, to save money foolish.. twice in the first 4 months it cost me to miss work.. the first time the battery was dead, second time the starter failed .. yippie it was paid for, but it cost me over $400 in lost wages ..
there's a balance to be found here.
Yup. And for some of us the consequences of missing work or even being late are much more dire.
For a guy in the military, who can be called in on a moments notice, being late even once could cost him $50,000 (half pay for two months, and a reduction in rank that results in depressed total career earnings) and his freedom for two months.
Doesn't mean he needs a GT350 that he can afford insurance on after the car note is paid, but seeing as a car is all these young guys have, it's not unreasonable for them to have a nice car (and all their basic food, basic entertainment, and basic housing are covered).
For a doctor they could lose months of work if they are following a patient through their pregnancy and have car trouble when delivery time occurs, or things could go sideways and they could be unable to respond due to car failure (not much time to wait for an uber, and you can't live at the hospital whenever you have a soon to be mother in the delivery window).
And then the wage of a doctor, miss a morning and your panel will be pissed, or your ER will be stacked, or your surgery board will be shot, and you might just be out hundreds for being a few hours late.
Again, no need for a Lexus 600 series, a reliable accord will do the trick, but if you like driving you'll not be content even with the very impressive manual accord coupe V6, and it's only money, how much do you need in retirement?
How do I invest at 1% when I have to pay back the zero percent loan?
Now I have a paid off vehicle, and can invest all that money that Id be using to pay off that loan. Win win.
You put it in a 1% interest online savings account and withdraw your payment every month. At the end of the loan you have earned interest on the savings and paid none on the loan. You win.
I don't have firm data on this but I would say the price of SUVs and light trucks have gone up way faster than the rate of inflation.
Back in 2000, dad bought a baseline S-10 for $9,995 - straight drive, manual everything, no AC even. Today, the lowest possible price of a Coloardo is $20,100.
Trucks and SUV's definitely.
Cars can still be had cheap - Nissan Versa for about $14K.
The cost of me missing one day of work is over $200 gross. I don't looks at my $420 / month car payment as being dumb with money ..
I look at buying that 1$200 Honda Accord, to save money foolish.. twice in the first 4 months it cost me to miss work.. the first time the battery was dead, second time the starter failed .. yippie it was paid for, but it cost me over $400 in lost wages ..
Yup. And for some of us the consequences of missing work or even being late are much more dire.
For a guy in the military, who can be called in on a moments notice, being late even once could cost him $50,000 (half pay for two months, and a reduction in rank that results in depressed total career earnings) and his freedom for two months.
Doesn't mean he needs a GT350 that he can afford insurance on after the car note is paid, but seeing as a car is all these young guys have, it's not unreasonable for them to have a nice car (and all their basic food, basic entertainment, and basic housing are covered).
For a doctor they could lose months of work if they are following a patient through their pregnancy and have car trouble when delivery time occurs, or things could go sideways and they could be unable to respond due to car failure (not much time to wait for an uber, and you can't live at the hospital whenever you have a soon to be mother in the delivery window).
And then the wage of a doctor, miss a morning and your panel will be pissed, or your ER will be stacked, or your surgery board will be shot, and you might just be out hundreds for being a few hours late.
Again, no need for a Lexus 600 series, a reliable accord will do the trick, but if you like driving you'll not be content even with the very impressive manual accord coupe V6, and it's only money, how much do you need in retirement?
All those negative consequences come from being late or missing a day?
The cost of me missing one day of work is over $200 gross. I don't looks at my $420 / month car payment as being dumb with money ..
I look at buying that 1$200 Honda Accord, to save money foolish.. twice in the first 4 months it cost me to miss work.. the first time the battery was dead, second time the starter failed .. yippie it was paid for, but it cost me over $400 in lost wages ..
there's a balance to be found here.
Then how does anyone have children? If they are sick you are out $200?!?!
Yup. And for some of us the consequences of missing work or even being late are much more dire.
For a guy in the military, who can be called in on a moments notice, being late even once could cost him $50,000 (half pay for two months, and a reduction in rank that results in depressed total career earnings) and his freedom for two months.
Doesn't mean he needs a GT350 that he can afford insurance on after the car note is paid, but seeing as a car is all these young guys have, it's not unreasonable for them to have a nice car (and all their basic food, basic entertainment, and basic housing are covered).
For a doctor they could lose months of work if they are following a patient through their pregnancy and have car trouble when delivery time occurs, or things could go sideways and they could be unable to respond due to car failure (not much time to wait for an uber, and you can't live at the hospital whenever you have a soon to be mother in the delivery window).
And then the wage of a doctor, miss a morning and your panel will be pissed, or your ER will be stacked, or your surgery board will be shot, and you might just be out hundreds for being a few hours late.
Again, no need for a Lexus 600 series, a reliable accord will do the trick, but if you like driving you'll not be content even with the very impressive manual accord coupe V6, and it's only money, how much do you need in retirement?
Don't doctors have families? Does everyone get mad if the kid is sick?
Kind of sucks when $25,000-$30,000 doesn't get you much anymore. And if you have a couple "new car" payments, then you are almost paying an extra mortgage.
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