Reality is.. you’ll get approved for a car because you won’t get approved for a house loan. Car loans are the new 2008 pre foreclosure loans. I’ve seen Caleb interview people with 500 credit score getting Mercedes Benz loans at 20% like wtf. How do you even get someone to give you a loan for such an expensive car. Then there’s car sales men selling cars with people who have no jobs and getting them approved with only $100 to their names .
Also to further push that that is the case, many of fraudulent loans approved during the 2008 crisis mirror what is happening in dealerships around the world today. Some of the ways of “getting customers approved” come from less than legal practices.
It definitely sucks for the people ignorant enough to apply for the loans, but it's not gonna cause any sort of bubble or crash in any way. Cars are a depreciating asset, so there's no investment interest into the asset- there's no real estate. The resale market for cars is nothing like homes- also the loan amounts and term lengths are way greater for a home loan. Banks aren't gonna go out of business from unpaid car payments when they only lend out $20-50k per loan, usually over a 3-7yr period, and when interest rates for car loans are so much higher relative to mortgages. They make too much money off everyone else making on-time payments for equally bad loans. Also they'll just get bailed out again anyway 😂
I lent my friend my car for the year I went back to school to be a Machinist. She had just gotten a new job with a pay raise that she was going to lose without transportation. She paid for my cars maintenance, oil change and new tires and her electrician boyfriend re-wired my garage for free. You really need close friends to survive in this economy 😅
You're so lucky to have a good friend of solid character, who appreciates a little honest help. Most people these days would steal the car, trash it, or wreck it. And then ask what your problem was, when they told you what they'd done and that they weren't going to pay for it. I was in college 25 years ago, and I have NEVER felt so flush that I felt safe to loan my vehicle.
@jeannieneuser5316 The trade school I go to gives a free bus pass with admission, and I wrote a contract that she would be liable for any damages. Honestly, my car was just going to sit in front of my house for 6 months, and my brother, who I live with, could give me a lift in case of emergency. I understand your perspective, it was definitely a risk, but if my friends are financially well off then they won't drown and pull me down with them so I try to raise them up when I can.
Dude throughiu5 all of history that saying has been true. You think life really was easier 50 years ago? 100 years ago? 600 years ago? Life has never been easy. It's foolish to think that saying only applies or extra applies to this time
I used to be a loan officer, and dealerships and manufacturers have learned that people only care if they can afford the payment. It doesn't matter if the loan is for 7-8 years because they will always trade it in for something new before it's paid off. The car will probably need a major repair before its paid for. Paying vehicles off is no longer a goal, and paying off a house is unheard of. Most people don't think of credit as real money.
I am only $6,000 away from paying off my car. I pay off $1,000 per month, $500 directly to the principle. Once it is paid off I will hold onto it for dear life.
One thing I hate as much as credit card debt is have a car payment. I try to pay off my car asap. I don't keep much on credit cards (I can pay off what little is one it if I need to) Cars nowadays are way over priced data collection devices that frankly are not worth the material they are made from. If you can't pay it off before the warranty expires don't buy it.
While statistics show this to generally be true... It could not be further from my personal mindset. The idea of ANY long term monetary commitment causes me intense emotional distress. I pay for things in full because that is the ONLY way I can go through life without being in a constant state of stress.
@@theblukatlife The usd will continue to be the world reserve, and we'll also just continue devaluing it through unnecessary government expenditures. The inflation rate came down, but not prices of goods/services.
I've never been able to stomach the actual payout once you take a loan on a vehicle.. I'm in California in 2024.. watching people take $80,000 loans out for a car.. the first house I bought in Oklahoma 10 years ago was $48,000..
I agree with the sentiment, but your comparison is far from apples to apples. You're comparing Oklahoma prices to California? The average house in California was around $350k 10 years ago. Inflation also increased the sticker price in everything. $45k today was around $35k a decade ago if not less.
Yeah but $48k in California won’t even get you a storage shed. Average home in CA is $900k. Not even in the worst area of Los Angeles can you find even a run down house for less than $500k
The bigger problem is people rolling negative equity on a previous car they still owe on into the loan on the next car. You see people $60-80k in debt on a light duty pickup truck that they can't even trade in for $30k.
Ha! I’m from a stable two parent home, and my parents have massive car loans just like most Americans, and spend above their means. Luckily I learned to do the opposite.
my parents grew up in a time before credit scores and retirement accounts. they couldn't even help me get a student loan and they didnt go to college. unless your parents are financial advisors or keep up with the times, "stability" has nothing to do with "financial literacy"
I have a 2001 ford explorer with 203k miles, I use it just as much as most people use their vehicles, tow small trailers, load it up, and occasionally off road it. It's been super reliable and relatively simple maintenance. I'm very happy with it and it cost me all but 3 grand
Same, 994runner with 300k miles for 5.5k 3 years and 30k later I drive it everywhere. Everyone's like isn't the 17mpg expensive? Well if you drive 10k a year /17mpg * 3.5 a gallon vs say a hybrid suv that gets 30mpg (not really but okay) that's 1k a year in fuel savings... Except you put down the same down payment as me as still pay 400+ a month. Even if i wanted to spend that sort of money I'd be getting a full grain leather interior and supercharger for my car. Not some plastic piece of shit on credit.
Always someone in the comments, especially on videos about electric cars “WELL I HAVE A 1983 FORD ESCORT WITH 900,000 MILES AND I’M BETTER THAN YOU” just drive whatever makes you happy lol
My loan for my car is at 7.669% and I’ve been trying to pay it off as fast as humanly possible. Im a year ahead on my 4 year loan and will hopefully be out from under it real soon.
Bro said back in my day like he’s 73 😂 Edit: I agree with everything he’s saying, the phrase ‘back in my day’ just sounds funny coming from someone in his mid 30s at the oldest
Getting a car is more expensive than most people realize, not only are you paying 10% extra, you also no longer can use that money to invest/ make money for you. Which is another 10% on top of the 10% you’re paying
I quit my successful career as a car salesman at Honda due to the insane amount of people coming to buy cars and dealer charging high interest rates. I made a lot of money in car sales but it got to a point where I had to educate customers more and more to put them in what they can afford and NOT the big flashy vehicle that they want. Management hated that… leaving was the best decision I’ve made. PLEASE guys have a budget and just remember… all you need to do is get to point A to point B!
Chash for clunkers did clear out a chunk of the used car market but that was 15 years ago getting rid of like 10 year old cars. At this point most of those cars would be classics It's crazy to me to hear claims that cars now are less reliable than in the past. They are more complex but a cheap scan tool can usually identify any issue. I think the big issue is the complexity scares away more home repairs. And less people doing maintenance themselves creates more people ignorant of even what basic maintained is needed.
@@JSchroedereeA big issue is that the complexity mistakes home repairs take longer, which isn't that big of a deal. But depending on the manufacturer of the car, you might not even be allowed to make those kinds of repairs. There are manufacturers out there that straight up won't post any information on how to fix certain issues you have or maybe say that you must have this special $400 tool in order to clear that code that is coming up for that sensor. That's why people say that the cars these days are less reliable, because you are tied to a dealership more often. Right to repair is a real big issue right now within the cars that is only just now starting to build any steam
About to buy a 2013 Highlander for $12k, all with cash. I’m not dealing with interest and car payments, even though they would give me a nice interest rate considering my good credit score. I have no debt and don’t intend to get into any.
I tried getting a 23k car (first time car buyer) with 5k down but used car interest is 8.99%. I was dumb and said it was fine even though the car payment would be 450/month. Which was insane not including gas, interest, and maintenance. And then the car salesman/finance ppl tried to sell me a bunch of other things very aggressively, and then I saw the actual final price of the car after financing (applying 8.99% interest) it was well over $30 000. Thank god I came to my senses and said no way José. Or I would’ve been in BIG trouble. Now I have developed a mindset to never a buy a car unless you have the money to purchase full price. A $5000-$6000 used car you can find easily, that way you don’t have to pay monthly for it just gas and insurance.
Its alot of bad things coming together honestly. 1) People spend more on cars year by year because culture has normalized cars becoming subscriptions instead of investments as they should be. Youll often find people 30 and under getting a different car every 3-5 years through leases instead of paying one off over a time frame or buying a buy here pay here. And keeping it for 10+ years like they used to. This leads me into my next point, as leasing and financing has become the primary way of purchasing a vehicle manufacturers snd dealerships are incentivized to make the most off of financing agreements as possible. Such that they raise the prices regardless of actual value. What difference does it make to a person if the car is priced at 60k instead of 50k if there going to lease or finance at 1k monthly for a few years and switch to another car. Beyond all of that sometimes theyll price cars intentionally beyond reach to make cars reasonably attainable through leasing or financing, alongside stagnant wages and youve got a perfect way to put an entire country into debt cycles. Just like credit cards… Finally, manufacturers no longer make cars reliable with lifelong ownership in mind… they make cars reliable for about 5-10 years of use in mind. Theyd rather you get a new model year than hold onto the one they sold you 5 years ago. Cars are turning into subscriptions, if your smart in 2024 youll get your self a toyota and maintain it. The only people who care about what you drive are the people you dont want in your personal life, save the money you dont spend on a car loan in other areas of your life or in a hobby car for pleasure. Edit to clarify: investment as in your not going to sell a used car more than you paid for it if youve kept it a couple of years. I mean as in the expanded range of opportunities you get from owning a vehicle. Just like you “invest” time into your career it does not mean financially but youve put in some sort of valuable resource. You now use a newly aquired car to work further from home, go to areas with more opportunities, carry materials or belongings move family around where they need to go etc. Youve invested your money into a car hoping that it would pay off and make you more comfortable/productive. Money put in -> non-monetary value derived
Because cars these days are not built to last. Literally the big name brands make money off parts. This guy I watched showed he can buy the same sensor for a Honda for $45 no name. The Honda sensor with a Honda stamp on it was $200. Same exact sensor. Parts for vehicles are way expensive. So ya people trade them in because at 3-5 years it cost more to fix then then the worth of the vehicle.
@@TheDoubleFA investment less as expecting a financial return and more as in you buy this to have your whole family gain opportunities from it for decades. Just like farmers often pass down tractors, people passed on cars to their children for awhile. Not saying that no one ever does this anymore in recent times but alot less common. You would invest in a car to gain your family a whole different set of opportunities and possibilities.
@@Reconbeatz509 yep, also alot of brands get hit with depreciation like crazy in part due to those choices. If within 10 miles off the lot a car losses thousands off sticker price was it ever really worth the msrp? Its just that most people will/have to pay whatever the dealership/manufacturer wants, including parts. Maybe im a bum because i dont want to spend more than a few hundred on a headlight💀
We bought a brand new SUV in 2020. We kept buying cheap cars that ended up having tons of issues and we got sick of living in repair shops. Sure, it’s taking a hit to our monthly income, but we know we are the only owners so we know it’s being cared for properly with maintenance, we did a ton of research on our make and model and know it’ll last a lifetime if we want it to, we have a warranty that will last to 100K, and this will be a vehicle we keep for as long as the lord will allow to own it for. I don’t regret it. It’s an investment for our future. I won’t get back what I paid into it BUT the peace of mind I get with it is worth every penny.
I hope it was a Toyota, Honda or Kia. If you bought an American or German car, you will end up eventually paying a large amount for repairs, though Ford is better than most American brands in that regard.
Been working over 8 hrs a day and 7 days in the factory for almost 2 years. Was sick of the cost of my mortgage. Hammering it with an open every 7 days 💪
You’re health is gonna take a big hit doing that.. then you’ll realize that all your problems aren’t anything.. just your health. Healcare in America is just fucked
I bought truck 10 years ago. I have driven it 300,000km so far. It was 38900 brand new. The same truck now is around 70,000. The ballooning cost of items is a huge factor in why vehicle debt has increased the way it has.
Exactly. It's a form of slavery, and I use my words carefully. The young (like my 23 year old niece) are manipulated into believing they need all this shit, german cars, gucci handbags, designer clothes and shoes etc. etc. not realising what they are ultimately paying.
They aren’t gonna die from it though, that’s the problem. People can continue to accumulate more and more debt and then that mindset gets passed to their next generation.
I’m 26 I make $78,000 a year and am a project Engineer on AZ at the TSMC plant. When I graduated college my earnings were $40,000 a year. In 2023 I bought my first ever brand new car. The timing was terrible and I probably didn’t need it, however, I love the car, it’s extremely fuel efficient. I’m down to 7.3% for 48 months from 11% for 84 months which is what it was when I bought it. I’ve been throwing extra money at it and definitely and hoping to pay it off asap. I had a Honda Civic before and my new car is an SUV that’s way heavier and larger and I get better gas mileage with it than I did with Honda Civic…cheapest isn’t always better. Anyways I think there is a balance I’ve had no car payments and hated the car I had and I’ve had large car payments and felt stressed about money but loved my car…so I don’t think there is a perfect remedy
A car is still just a tool to get from A to B for me, because I hate driving. I’m sure that feeling has saved me money through less gas, less milage, and buying a regular car which is now fully paid for and I’ll have for years
Thank god in Europe you can get by without a car with no problem - public transport & taxi solves most issues for far less. (I have a family of 5, which i support. Zero debt, we travel a lot)
I’m 22 I bought a 2013 dodge avenger that had 22.5k miles on it. (Canada rental car) for 10k total (1.5k down & 8.5k on a 4 year 8% loan) I’m personally 1 / 4 years into paying it off and am IN LOVE with it. People are so caught on “getting what’s new” instead using what works for everyday use.
People buying cars to impress others, this is silly. Buy a car for me and me only. Paid it off now i just stack my savings for the next car or major repairs. 95kmiles and hope i can make it last for another 3 years and 50k more miles
Never go into debt for a car. Bought my car for $2500, 9 years ago. Still going strong. Drove it literally half way around the world. Is now 32 years old. Wouldn’t swap it for any brand new car.
Its cause cars are something you need like shoes. And companies are charging way too much for no reasons I mean a Nissan and Kia can cost as much as a Mercedes now make that make sense 😂
Supply and demand, people don’t need these expensive cars, they WANT them and are willing to pay the price for them. I drive a 2008 Hyundai, works just fine. I could afford to go buy a G wagon cash but I’m not an idiot like the rest of these people
People may need a car for work but they want a brand new $60k or higher SUV. Dealerships love it because they get commissions on finance deals and usually the cars have to come back to named dealers to get service and aftersales work done (which is where most of the profit is).
@@Joey_DiGs that's everything my dude you don't need a color TV lol or 70 inch 4k one you just want them you don't need a new iPhone every year. I get what you're saying but no one asked car manufacturers to make new cars every year and to only add apple carplay like 3-4 years ago... If car manufacturers weren't sk dumb and greedy and made a new model every 2-3 years inflation would be less prices would be lower and used market would be stronger
@@mrtoad1408 a rav 4 starts at 27-28k and you can barely find the base model then you get a model you do like and it's 3-5k over sticker that's no one's fault besides manufacturers and dealers. Most new cars are way too expensive a Hyundai Kona starts at 23-25 k shit should be like 18k on a good day lol
I had a car loan for 7 years, but it actually made sense as the interest rate was only 1.9%. Even mortgages at the time were around 3%. Now the car is paid off, and I’ll hang onto it.
The biggest wealth killer is not shopping for the best deal, from the daalership and the best loan conditions. Do you need to pay $50k for a car. Do you need to buy new.
This is key, go to several dealerships and negotiate the terms. I just find it crazy that every dealer will give you different prices and terms for the same car
Currently live without a car since I'm in NYC, but this is why I'm just going to purchase a used EV in cash when I need one. I don't need the newest model or anything fancy. I prefer EVs because they get some decent perks such as parking and express lanes. Used Model 3s go for under 30K. I'll happily pay cash for that and use it for the next 10 years until I have a decent grasp on other finances like a house. I hate owing more than 1 type of debt and right now student loans are the only debt I have at just 22K.
This is very true. There is absolutely no reason to lease or buy a car with a loan. Buy a car that you can afford to buy in cash and consider maintenance, gas, insurance. There are infinite options for cars up to $10/20K. And when you are done after many years it still has equity. Watching a lot of the Caleb audits and having some friends that lease or take a loan on cars that have such high interest rates is financial illiteracy. This will crush you unless you are making well over 6 figures.
It's SUV's, 25k still gets you a brand new, mid trim commuter sedan but everyone thinks they need an suv to get to work when for the vast majority of people a corolla is more than enough to get you there and back and it's significantly more efficient.
It isn't just SUVs but trucks are included in there. $50k to $75k for a new truck is around a 20% of a typical mortgage at a higher interest rate. I get it if you need the towing capability, 4WD capability, or the carry capacity if you're working construction, but alot of truck owners rarely need these.
I live in an area that gets a lot of snow so you need at least an SUV with AWD. But I got mine brand new at 26k during covid with 4% interest so it isn't that bad
I live in an area made famous by snow and mountains, I drive a Fwd corolla, an awd camry will do the same thing with a lower center of gravity to avoid tipping, significantly better gas mileage, better visibility, and it's way easier to stop on slick roads. If you want an suv that's fine but unless your getting stuck in the mud on a regular basis you don't need it
@djthegrim Most people didnt have AWD up until recently, AWD was extremely uncommon and people survived just fine. You can justify your purchase all you want
No one *needs* to pay 50 grand on a car. People who spend 50 grand on a car just want *that* car rather than another less expensive car. And hey, I get it. Nice things are nice; agreed. On the other hand… a car at half the cost will still fulfill its key purpose in basically the same way as the 50 grand car. The key purpose is the “need” (transportation for work/life) while the latter half is for luxury. Not trying to be harsh, but if the only way you can pay out 50 grand is to take a loan, you shouldn’t spent that 50 grand on luxury. Choosing a less expensive alternative will be much better for you in the long run and you’ll be glad you did. Maybe not that day, but in the end you will be glad.
But the root problem is the same. People buy too much car, too much house, too much education, and too much stuff, because they can "afford" the payment. If everyone refused to go past 25% of their monthly income on their rent or mortgage, prices would be forced downward.
You can still get great economy cars for around $20k give out take a few grand. Our Impreza has been great. 9 years old, ~306k with pretty normal maintenance/fluids.
Because it is Required. 100%. No reliable car? No job, no money, stress because of bills, debt, no social life, no Relationships, it is required to have a decent car these days.
My husband drives a 2008 Nissan Altima he purchased over 2 years ago for 1K….. he drives it over 60 miles a day into the city for work. It’s very reliable. Drives it in the snow. Before that he had a VERY old Corolla that he drove into the ground. Does it need some repairs once in a while? Sure. We’ve spent maybe $700 in the last 2 and a half years. Certainly beats a car payment. Old cars can be very reliable. Do your research and purchase wisely. You don’t need to have a high car payment to equal reliability in a vehicle. It’s a lie that consumerism has taught us.
I promise you our 2004 Toyota Corolla is quite reliable. Probably more so than a luxury brand of car. Friends of ours had a BMW and they ended up getting rid of it because it was such a pain to fix and it was always breaking down. We meanwhile are still driving that Corolla.
That's the best part about being a mechanic because I can buy cheap and fix Maximum , i'm going to pay for a car to git me a to b to 3000 Dollars Well , my daily right now paid 700 for it Yes, it's reliable
Own 15 and 22yr old Toyotas. Haven't had a car loan in 10yrs. It really helps. Stop buying domestic garbage, learn a little diy and maintain the vehicle.
Not true, a brand new corvette in 2020 was 57K, an honest price. Chevy realized being honest was a mistake and quickly raised it 20K, now I think it’s closer to 80-90K. BUT A corvette is a luxury sport car, a damn Nissan maxima with cool features and “sport” mode should not be the price of a damn luxury car.
Yea. 10 years ago in 2014 minimum wage was $8. Now in 2024 minimum wage is $16 - $19, double the amount and yet people are still broke, people still can't afford a new car, afford a new home.
Working in the auto industry, it's commonplace for people to get a high repair bill on a 7-8 year old car, and decide to trade it in on a new car. So they go from a $1500-$2000 bill, to a monthly $800-$1000 bill. I never understand why they make that decision.
It's the concern that when they pay that $1,500-2,000 bill, a few months later there will be another one. And then another one. And then a $3,000 replacement of some engine component. Then $5,000 before the transmission needs repair... People like the consistency of paying one flat payment and not having to worry about repairs or breakdowns.
@@MetalSandman999 Yeah I imagine that's the justification people use. Reality is, most vehicles last with minimal problems as long as they're cared for. Expensive repairs happen on new cars too. Even if you let a car get worn out, get a used car with a warranty that covers big stuff. New is for people who don't blink at losing $10-15k of value over the first year. Or toys, like a new Corvette you'll keep forever. 10 year old clean car with maintenance history is what I like, but I also don't pay for labor.
The truth is that the car industry has invested so much money into making this country absolutely dependent on cars, and year after year, they've made cars bigger, meaning they cost more, and have taken the smaller models off the market. So something that has become essential keeps getting more and more expensive.
I had an ass pain trying to bridge the gap of buying a vehicle after my truck crapped out that was worth almost nothing. I had to get something reliable but also without crazy mileage and somehow either affordable all cash or a manageable payment. I went the new car route. 26K sedan. Brand new. 6 year fixed rate. 360 a month payment. Was a necessary evil for me. You can't buy reliable used cars for 5k anymore. And for those who claim they did, you are an EXCEPTION, not the norm.
The fact a lot of new cars are crazy unreliable, look at Ford eco boost engine that now they have the timing chain (but still the wet belt for the oil pump) look at the pure tech engine that the stellantis group uses they are crazy
@@alessandromelis2074 planned obsolescence. The fact that certain parts of Toyota cars are showing that philosophy tells you everything you need to know about the reality of this world
My grandpa is currently leasing a car through the chevy dealership and it is time for him to upgrade. The salesman told him that his income isn't enough to get the car he wants (a malibu). Which is crazy because my grandpa worked for GM for 35 years, and retired out with a pension. He even receives the employee discount, and he has no debt. The cars are becoming ridiculously priced for what they are.
Cars just cost more than they used to. Cars “back in my day” had no luxuries. Now cars aren’t made without all the bells and whistles, hence why they cost more. Not to mention inflation right now.
Just remember, that’s only a piece of car ownership costs. Collectively as a society, we are enriching the automotive, oil and insurance industries and we collectively spend literal trillions every year on car ownership alone. If we returned to the old way of city building with functional public transit and mixed use walkable neighborhoods, we could save hundreds of billions of dollars by barely even really trying. Remove arbitrary parking minimums, remove ultra restrictive exclusionary zoning and the free market could easily solve the housing crisis and end car dependency
Yet look at the rent and real estate costs in public transit majority cities. They're exponentially higher. A vehicle, as built in the 60's and 50's, proved out to be an asset. Now we charge nearly $100k for a luxury car that us built to last the length of the lease. The thing to do would be to force automakers to underwrite their vehicles and make all auto loans 10-15 year loans, thus forcing improved quality standards on the automakers lest they be left saddling worthless debt on badly built vehicles. Simultaneously, kick the Hedge Funds out of the Single Family Home and Condo Markets while also opening up all foreign owned "static asset" real estate to the rent controlled market or see to it that the foreign owner spends at least 9 months a year there or, if they don't wanna be subject to rental, they'll be subject to sell or auction. If you rally wanted to be a leader, you could also then redistribute the wealth housed in the non-taxable University Endowments to pay down the student debt which would also result in University's cranking out students with market value degrees at a higher rate due to the need for fresh donor classes to refill those Endowment Coffers.
@@c.s.s.5326 They’re exponentially higher for a start because of how scarce they are, and secondly, because misguided politicians, including democrats and progressives have bought into the suburban experiment mythos. There’s a good video I watched a while back which can actually shed light on what I mean, it’s by a channel called “Oh the Urbanity!” And iirc, the video was called “how the housing crisis breaks the political spectrum”. It goes into detail how several political ideologies play into the modern political debate surrounding the housing crisis and how to solve it. I also don’t feel that the solution to the housing crisis would be to double down on building out the car purchasing apparatuses that currently exist. That was of course how we wound up with the current status quo of home purchases, where 30 year mortgages were tied to the idea that the only home that is suitable to own is detached single family homes, and so banks only loan to purchase homes for suburban sprawl
We bought a house in London in 1998 that within 5 years we literally could not have afforded to rent. Only took a car loan out for one car, which was new and kept it for 13yrs.
It's not just bad quality, it is also about putting a lot of tech in your car. For instance giant ass screens, huge sunroofs etc. This increases the overall maintenance and not to mention adds more points of failure.
@@oemj7147 THIS, is inaccurate. Japanese cars of the 90s, 00s, and early 10s were rock solid. Nissan was bought by some Euro trash company and the CVTs killed them. American cars, trucks specifically, have become far too complex. Too many idiots buying BRO-DOZERS out there that have more tech than a 2018 Honda Accord. Just stupid.
@@justinmcroberts4633 Totally accurate. I had a 1991 Honda Prelude that was drinking 1 quart of oil per thousand miles with only 70K miles on it. Had a 2007 Accord that needed a transmission replacement at 12k miles and was a rattle trap. Not as reliable as you think. Well, at least the Prelude was fun to drive.
We also grew up where our parents didn't constantly go out to eat, McDonald's and pizza once a week was a treat for us! They couponed for groceries. They didn't have monthly payments besides their mortgage. They took a sack lunch to work and made their own coffee. My dad kept 2 of his Nissan trucks from the early 80s running for 30 years. Now everyone is crying and people are making fun of them if they don't have the newest iPhone. Debt to LOOK wealthy has become a TREND.
So many people justify a “more reliable vehicle” at $750 per month vs buying something you can afford and saving $750x12 is $9,000 incase there is a repair. I’m glad I’m not into fancy vehicles.
Food is a silent killer i remember when I first started working and I spent almost 1k on eating out never again will I do that. And my boys as we made more money they ended up spending 12k on DoorDash alone in just 1 month.
Buy a crappy car with cash and have huge maintenance bills where you need a loan or get a loan get a car that you won’t need to fix up right away… hmmm so many good choices
Huge? Lol you drop a couple grand on major fixes and you're guaranteed for 5 years minimum. Total cost spend you'd STILL be paying lower for a base, brand new car after depreciation lol.
They've normalized a $1000 a month car payment... Prices skyrocket during covid due to scarcity. Now inventory has been restored but prices have remained... It's intentional.
I bought a brand new 2020 Civic (base model LX) for 20k out the door, with 0.9% interest, right before the prices skyrocketed. Sadly, will never get that kind of a deal again
29yrs ago a fully loaded brand new Toyota 4 runner cost me 25k. Want to guess or maybe look up how much a fully loaded 4 runner is now? You might find a 2024 for 50k, however they jump to 85k+ real quick....
Thankfully because of videos like this, I didn’t fall into the new car trap. I keep telling myself I gotta wait until I’m debt free to buy myself a nice car lol
Why did cars go from a necessity...???? They never truly are for most people. Car companies lobbied, and still do, for funding, development,and projects that decrease walkability and/or transit feasibility. A manufactered need. Imagine how much $200/mo more would mean to a person making 35-40k living in a $1200/mo studio/1 bed apartment. If car dependency wasn't so rampant, low income households would have that extra money. For reference, my math assumes $100 for a transit pass, $100 for gas, $100 for insurance, and $100 for a car payment each month. 100 is low for gas from my personal observation. 100 for insurance varies, but it's quite conservative for most people I've asked. Now, one might not have a car payment, but I also didn't account for the average monthly cost to maintain/repair the vehicle. In saying that, I think it's safe to assume that $200 is near the low end of what not needing, and not having, a car would save. Also, I don't know about you, but I think the economy would do better with $200+ more in even 10-20% of the households who are in the bottom 50%. That's if we got rid of insane car dependency. It's like a UBI, for non-car owners, but the government spends quite a bit less when car dependency isn't a problem because transit still takes payments to offset the costs. Seems like a win to me.
What blows my mind is people will pay anywhere from 1k -2k for a car a month including insurance and gas payment ect. Just to drive it to work have it sit 10 hrs and drive it back home. They are scared to put miles on it because it’ll lose value lol
I disagree the problem is car loans are high because people buy things they can’t afford… and on top of that get more than 1 car (more than they need) and they either can’t afford it or need it.
It’s against compliance regulations to turn away a customer who wants us to submit them for financing for a vehicle regardless of their situation. It’s all on the lenders and the customer. Customer can walk away and say no to the lenders terms.
First car i ever financed was in 2014 and it was brand new for 22K and im ASTOUNDED by the fact that i can barely find a brand new Accord or Corrolla for that price. Used cars arent much better either. 10 year old cars from a generation or two ago going for 15+ like, my brother in Christ, this thing doesn't even have Bluetooth audio, 6K take it or upgrade the radio at least.
I have a car that I bought new 14 years ago. I thought about replacing it with something new. However the mere idea of getting into debt just to do exactly the same thing I do today already puts me off immediately.
Me & my wife have never owned a credit card, we've never spent any money that didn't save 1st. Except our mortgage which we paid off 15 years ago. We've only earned the average wage in the UK our whole lives. But getting no debts was the best thing we've ever done financially. I'd advise everyone who can get by without getting debts to do so. A car is a tool to get from A to B. No matter how fantastic you believe you are because you've got the latest & greatest car you can get debt for. There's nothing fantastic about most of your wages being paid out on debts. Live within your means if you can, sometimes it's hard but it's worth it.
People living above their means is still what drives this debt. I could have paid cash for my car but took a loan at 1.9% because that money makes more invested elsewhere. Even my high interest savings account is 4.9% I always pay my cc balances in full every month and use the points or cash back. After doing this for the last 30 years I’ve maintained an 826 credit score. It’s not hard, you just have to have discipline and don’t spend money you don’t have. Also, new car prices are hideous, the loans are worse and the market is dropping out from under them which is good, they’re insane charging what they do and these things depreciate faster than a jar of mayonnaise left in the sun.
Until the american car companies actually allow vehicles that are new, reliable, and affordable to the common citizen, the market will continue to drop out of those insanely overpriced vehicles. Idgaf give me a manual transmission, roll up windows, no "infotainment" I mean maybe a hundred bucks to get it to hook up Bluetooth, and basic safety.
Reality is.. you’ll get approved for a car because you won’t get approved for a house loan. Car loans are the new 2008 pre foreclosure loans. I’ve seen Caleb interview people with 500 credit score getting Mercedes Benz loans at 20% like wtf. How do you even get someone to give you a loan for such an expensive car. Then there’s car sales men selling cars with people who have no jobs and getting them approved with only $100 to their names .
Yup. I am a finance manager at a CDJR store and its incredible what banks will let me get away with. Make the money while ya can boys
💯
Also to further push that that is the case, many of fraudulent loans approved during the 2008 crisis mirror what is happening in dealerships around the world today. Some of the ways of “getting customers approved” come from less than legal practices.
@@michaelfenwick4184U get a degree ?
It definitely sucks for the people ignorant enough to apply for the loans, but it's not gonna cause any sort of bubble or crash in any way.
Cars are a depreciating asset, so there's no investment interest into the asset- there's no real estate. The resale market for cars is nothing like homes- also the loan amounts and term lengths are way greater for a home loan. Banks aren't gonna go out of business from unpaid car payments when they only lend out $20-50k per loan, usually over a 3-7yr period, and when interest rates for car loans are so much higher relative to mortgages. They make too much money off everyone else making on-time payments for equally bad loans.
Also they'll just get bailed out again anyway 😂
I lent my friend my car for the year I went back to school to be a Machinist. She had just gotten a new job with a pay raise that she was going to lose without transportation. She paid for my cars maintenance, oil change and new tires and her electrician boyfriend re-wired my garage for free.
You really need close friends to survive in this economy 😅
You're so lucky to have a good friend of solid character, who appreciates a little honest help.
Most people these days would steal the car, trash it, or wreck it. And then ask what your problem was, when they told you what they'd done and that they weren't going to pay for it.
I was in college 25 years ago, and I have NEVER felt so flush that I felt safe to loan my vehicle.
My friend would have totaled my car.
@@T.S.000most would have. Most would have.
@jeannieneuser5316 The trade school I go to gives a free bus pass with admission, and I wrote a contract that she would be liable for any damages. Honestly, my car was just going to sit in front of my house for 6 months, and my brother, who I live with, could give me a lift in case of emergency. I understand your perspective, it was definitely a risk, but if my friends are financially well off then they won't drown and pull me down with them so I try to raise them up when I can.
Dude throughiu5 all of history that saying has been true. You think life really was easier 50 years ago? 100 years ago? 600 years ago? Life has never been easy. It's foolish to think that saying only applies or extra applies to this time
I used to be a loan officer, and dealerships and manufacturers have learned that people only care if they can afford the payment. It doesn't matter if the loan is for 7-8 years because they will always trade it in for something new before it's paid off. The car will probably need a major repair before its paid for. Paying vehicles off is no longer a goal, and paying off a house is unheard of. Most people don't think of credit as real money.
Did you hear that a lot of countries are dumping their dollar reserves like crazy? What do you think about that? Gold just surpassed $2700
I am only $6,000 away from paying off my car. I pay off $1,000 per month, $500 directly to the principle. Once it is paid off I will hold onto it for dear life.
One thing I hate as much as credit card debt is have a car payment. I try to pay off my car asap. I don't keep much on credit cards (I can pay off what little is one it if I need to) Cars nowadays are way over priced data collection devices that frankly are not worth the material they are made from. If you can't pay it off before the warranty expires don't buy it.
While statistics show this to generally be true... It could not be further from my personal mindset. The idea of ANY long term monetary commitment causes me intense emotional distress. I pay for things in full because that is the ONLY way I can go through life without being in a constant state of stress.
@@theblukatlife The usd will continue to be the world reserve, and we'll also just continue devaluing it through unnecessary government expenditures. The inflation rate came down, but not prices of goods/services.
I've never been able to stomach the actual payout once you take a loan on a vehicle.. I'm in California in 2024.. watching people take $80,000 loans out for a car.. the first house I bought in Oklahoma 10 years ago was $48,000..
My first house was 65k. I couldn’t see myself spending more on a car than a house 😂
I agree with the sentiment, but your comparison is far from apples to apples.
You're comparing Oklahoma prices to California? The average house in California was around $350k 10 years ago.
Inflation also increased the sticker price in everything. $45k today was around $35k a decade ago if not less.
Yeah but $48k in California won’t even get you a storage shed. Average home in CA is $900k. Not even in the worst area of Los Angeles can you find even a run down house for less than $500k
Was your first house a cardboard box?
I really need to move country
The bigger problem is people rolling negative equity on a previous car they still owe on into the loan on the next car. You see people $60-80k in debt on a light duty pickup truck that they can't even trade in for $30k.
i paid my car off and swore i wouldn’t buy one until the wheels fell off. having a car note was a nightmare
I said that, too. Three years later I financed a brand-new vehicle. Being debt-free is great but massively over-hyped by Ramsey, et al.
But it’s worse having to pay for an increasing number of repairs as the car ages
That’s currently me right now 😂
@@nikknackosrsit varies what kind of repares. My cars AC stopped working but I’m not going to buy a new car because of that! 😂
@@nikknackosrsnot if you learn how to do the basic stuff yourself 🤫
Biggest wealth killers are the lack of stable two parent family homes. No one is teaching these kids responsibility and healthy spending habits.
YES 100% parenting is everything
Exactly. Personal habits and personal accountability.
Ha! I’m from a stable two parent home, and my parents have massive car loans just like most Americans, and spend above their means. Luckily I learned to do the opposite.
because stable two parent homes also can't have bad financial habits....right?
my parents grew up in a time before credit scores and retirement accounts. they couldn't even help me get a student loan and they didnt go to college. unless your parents are financial advisors or keep up with the times, "stability" has nothing to do with "financial literacy"
I have a 2001 ford explorer with 203k miles, I use it just as much as most people use their vehicles, tow small trailers, load it up, and occasionally off road it. It's been super reliable and relatively simple maintenance. I'm very happy with it and it cost me all but 3 grand
Same, 994runner with 300k miles for 5.5k
3 years and 30k later I drive it everywhere.
Everyone's like isn't the 17mpg expensive? Well if you drive 10k a year /17mpg * 3.5 a gallon vs say a hybrid suv that gets 30mpg (not really but okay) that's 1k a year in fuel savings...
Except you put down the same down payment as me as still pay 400+ a month.
Even if i wanted to spend that sort of money I'd be getting a full grain leather interior and supercharger for my car. Not some plastic piece of shit on credit.
Now you’re going to get a check engine light because you made this comment. Good luck.
I like ford exploders. Think I might get one.
Always someone in the comments, especially on videos about electric cars “WELL I HAVE A 1983 FORD ESCORT WITH 900,000 MILES AND I’M BETTER THAN YOU” just drive whatever makes you happy lol
I swear the 01 Ford Explorer was the last year they were durable 😂
My loan for my car is at 7.669% and I’ve been trying to pay it off as fast as humanly possible. Im a year ahead on my 4 year loan and will hopefully be out from under it real soon.
And then once you pay it off, you’ll get a new car and do it all over again.
@@luludvega nah, one and done for me as long as it runs I’ll remain car loan free
Good for you. Fight like your life depends on it to not get another car loan
@@Brazzy614
That's the first step.
The next even more important step is to start setting money aside to pay cash for the next one!
Refinance it asap
Baby step 1b- stock up on beans and rice, two weeks of water and plant a fruit tree.
Hi Mr Ramsey
Bro said back in my day like he’s 73 😂
Edit: I agree with everything he’s saying, the phrase ‘back in my day’ just sounds funny coming from someone in his mid 30s at the oldest
I think he meant during jis chilhood, when his dad bought a car
@@69sound81are you like 16 years old or something. 15 years ago average people weren’t driving around in $50,000 cars.
That’s how bad the prices gone up in the last 20 years.
All the things on top model have become standard
@@akr12877 oh I completely agree with I’m, I just find his choice of words amusing
Getting a car is more expensive than most people realize, not only are you paying 10% extra, you also no longer can use that money to invest/ make money for you. Which is another 10% on top of the 10% you’re paying
I quit my successful career as a car salesman at Honda due to the insane amount of people coming to buy cars and dealer charging high interest rates. I made a lot of money in car sales but it got to a point where I had to educate customers more and more to put them in what they can afford and NOT the big flashy vehicle that they want. Management hated that… leaving was the best decision I’ve made. PLEASE guys have a budget and just remember… all you need to do is get to point A to point B!
The car industry. Cash for clunkers??? Car repair cost?
I work on my own car and parts are expensive.
I can only imagine what Becky is paying a mechanic/dealership for a simple blinker fluid change.
Chash for clunkers did clear out a chunk of the used car market but that was 15 years ago getting rid of like 10 year old cars. At this point most of those cars would be classics
It's crazy to me to hear claims that cars now are less reliable than in the past.
They are more complex but a cheap scan tool can usually identify any issue.
I think the big issue is the complexity scares away more home repairs. And less people doing maintenance themselves creates more people ignorant of even what basic maintained is needed.
@@JSchroedereeA big issue is that the complexity mistakes home repairs take longer, which isn't that big of a deal. But depending on the manufacturer of the car, you might not even be allowed to make those kinds of repairs. There are manufacturers out there that straight up won't post any information on how to fix certain issues you have or maybe say that you must have this special $400 tool in order to clear that code that is coming up for that sensor. That's why people say that the cars these days are less reliable, because you are tied to a dealership more often. Right to repair is a real big issue right now within the cars that is only just now starting to build any steam
About to buy a 2013 Highlander for $12k, all with cash. I’m not dealing with interest and car payments, even though they would give me a nice interest rate considering my good credit score. I have no debt and don’t intend to get into any.
That's an 11 year old car. It should be half that price.
@@rrteppo less than half! My niece bought the same car same year 2 years ago for $4k. How he is paying $12k idk but thas crazy.
@@LAAM619 You ever heard of mileage? could be a grandmas car or something similar with very low miles.
Golden rule: always save and pay cash for cars. No debt on cars.
@rrteppo you can thank the federal government destroying 700,000 perfectly functional cars for that
I tried getting a 23k car (first time car buyer) with 5k down but used car interest is 8.99%. I was dumb and said it was fine even though the car payment would be 450/month. Which was insane not including gas, interest, and maintenance. And then the car salesman/finance ppl tried to sell me a bunch of other things very aggressively, and then I saw the actual final price of the car after financing (applying 8.99% interest) it was well over $30 000. Thank god I came to my senses and said no way José. Or I would’ve been in BIG trouble. Now I have developed a mindset to never a buy a car unless you have the money to purchase full price. A $5000-$6000 used car you can find easily, that way you don’t have to pay monthly for it just gas and insurance.
9%?, a "good" car loan in Mexico is 11%
How much is a Honda Civic over there?
Its alot of bad things coming together honestly.
1) People spend more on cars year by year because culture has normalized cars becoming subscriptions instead of investments as they should be.
Youll often find people 30 and under getting a different car every 3-5 years through leases instead of paying one off over a time frame or buying a buy here pay here. And keeping it for 10+ years like they used to.
This leads me into my next point, as leasing and financing has become the primary way of purchasing a vehicle manufacturers snd dealerships are incentivized to make the most off of financing agreements as possible. Such that they raise the prices regardless of actual value. What difference does it make to a person if the car is priced at 60k instead of 50k if there going to lease or finance at 1k monthly for a few years and switch to another car. Beyond all of that sometimes theyll price cars intentionally beyond reach to make cars reasonably attainable through leasing or financing, alongside stagnant wages and youve got a perfect way to put an entire country into debt cycles. Just like credit cards…
Finally, manufacturers no longer make cars reliable with lifelong ownership in mind… they make cars reliable for about 5-10 years of use in mind. Theyd rather you get a new model year than hold onto the one they sold you 5 years ago.
Cars are turning into subscriptions, if your smart in 2024 youll get your self a toyota and maintain it. The only people who care about what you drive are the people you dont want in your personal life, save the money you dont spend on a car loan in other areas of your life or in a hobby car for pleasure.
Edit to clarify: investment as in your not going to sell a used car more than you paid for it if youve kept it a couple of years. I mean as in the expanded range of opportunities you get from owning a vehicle.
Just like you “invest” time into your career it does not mean financially but youve put in some sort of valuable resource.
You now use a newly aquired car to work further from home, go to areas with more opportunities, carry materials or belongings move family around where they need to go etc.
Youve invested your money into a car hoping that it would pay off and make you more comfortable/productive.
Money put in -> non-monetary value derived
Cars as investments? Wtf are you talking about 😂😂
Because cars these days are not built to last. Literally the big name brands make money off parts. This guy I watched showed he can buy the same sensor for a Honda for $45 no name. The Honda sensor with a Honda stamp on it was $200. Same exact sensor. Parts for vehicles are way expensive. So ya people trade them in because at 3-5 years it cost more to fix then then the worth of the vehicle.
@@TheDoubleFA investment less as expecting a financial return and more as in you buy this to have your whole family gain opportunities from it for decades. Just like farmers often pass down tractors, people passed on cars to their children for awhile. Not saying that no one ever does this anymore in recent times but alot less common.
You would invest in a car to gain your family a whole different set of opportunities and possibilities.
@@Reconbeatz509 yep, also alot of brands get hit with depreciation like crazy in part due to those choices. If within 10 miles off the lot a car losses thousands off sticker price was it ever really worth the msrp?
Its just that most people will/have to pay whatever the dealership/manufacturer wants, including parts.
Maybe im a bum because i dont want to spend more than a few hundred on a headlight💀
Even if you buy a car it’s still a subscription. By the time it’s paid off the maintenance bills kick in.
We bought a brand new SUV in 2020. We kept buying cheap cars that ended up having tons of issues and we got sick of living in repair shops. Sure, it’s taking a hit to our monthly income, but we know we are the only owners so we know it’s being cared for properly with maintenance, we did a ton of research on our make and model and know it’ll last a lifetime if we want it to, we have a warranty that will last to 100K, and this will be a vehicle we keep for as long as the lord will allow to own it for. I don’t regret it. It’s an investment for our future. I won’t get back what I paid into it BUT the peace of mind I get with it is worth every penny.
Well done.
So how’s the 4Runner holding up so far?
I hope it was a Toyota, Honda or Kia. If you bought an American or German car, you will end up eventually paying a large amount for repairs, though Ford is better than most American brands in that regard.
@@cgreen7157You're clearly not a car guy.
@@oemj7147 No I'm not, and I realize that there is a big difference between certain brands of reliable cars, and cars that are actually fun to drive.
Graham just happy CoffeeZilla hasn't made another video lately.
Bingo lol
Been working over 8 hrs a day and 7 days in the factory for almost 2 years. Was sick of the cost of my mortgage. Hammering it with an open every 7 days 💪
You’re health is gonna take a big hit doing that.. then you’ll realize that all your problems aren’t anything.. just your health. Healcare in America is just fucked
@@BigM0neyHustla I used to say thank god I'm Canadian... Then Trudeau happened💩 ... But at least for now I got that covered
Atleast take rest one day a week. It's a must...
I bought truck 10 years ago. I have driven it 300,000km so far. It was 38900 brand new. The same truck now is around 70,000. The ballooning cost of items is a huge factor in why vehicle debt has increased the way it has.
natural selection.
Voluntary slavery and indentured servitude.
It’s organized by the elite. “You will
Own nothing and be happy”
You people should really look up what natural selection means
Exactly. It's a form of slavery, and I use my words carefully. The young (like my 23 year old niece) are manipulated into believing they need all this shit, german cars, gucci handbags, designer clothes and shoes etc. etc. not realising what they are ultimately paying.
They aren’t gonna die from it though, that’s the problem. People can continue to accumulate more and more debt and then that mindset gets passed to their next generation.
“Voluntary slavery” is an oxymoron.
I’m 26 I make $78,000 a year and am a project Engineer on AZ at the TSMC plant. When I graduated college my earnings were $40,000 a year.
In 2023 I bought my first ever brand new car. The timing was terrible and I probably didn’t need it, however, I love the car, it’s extremely fuel efficient. I’m down to 7.3% for 48 months from 11% for 84 months which is what it was when I bought it. I’ve been throwing extra money at it and definitely and hoping to pay it off asap.
I had a Honda Civic before and my new car is an SUV that’s way heavier and larger and I get better gas mileage with it than I did with Honda Civic…cheapest isn’t always better.
Anyways I think there is a balance I’ve had no car payments and hated the car I had and I’ve had large car payments and felt stressed about money but loved my car…so I don’t think there is a perfect remedy
A car is still just a tool to get from A to B for me, because I hate driving. I’m sure that feeling has saved me money through less gas, less milage, and buying a regular car which is now fully paid for and I’ll have for years
Do you have another way to get around where you live? Like biking or taking transit?
Thank god in Europe you can get by without a car with no problem - public transport & taxi solves most issues for far less. (I have a family of 5, which i support. Zero debt, we travel a lot)
I’m 22 I bought a 2013 dodge avenger that had 22.5k miles on it. (Canada rental car) for 10k total (1.5k down & 8.5k on a 4 year 8% loan) I’m personally 1 / 4 years into paying it off and am IN LOVE with it. People are so caught on “getting what’s new” instead using what works for everyday use.
Also, they don't talk about it often but kids as well. Kids, crazy rent, car loans.
People buying cars to impress others, this is silly. Buy a car for me and me only. Paid it off now i just stack my savings for the next car or major repairs. 95kmiles and hope i can make it last for another 3 years and 50k more miles
also people buying large 'off-road' SUVs/trucks when there are paved roads everywhere and 95% will never even see a dirt road
Never go into debt for a car. Bought my car for $2500, 9 years ago. Still going strong. Drove it literally half way around the world. Is now 32 years old. Wouldn’t swap it for any brand new car.
Its cause cars are something you need like shoes. And companies are charging way too much for no reasons I mean a Nissan and Kia can cost as much as a Mercedes now make that make sense 😂
Car companies on average make around 3-5k profit on a brand new car. The technology is just fucking expensive now compared to 20-30 years ago
Supply and demand, people don’t need these expensive cars, they WANT them and are willing to pay the price for them. I drive a 2008 Hyundai, works just fine. I could afford to go buy a G wagon cash but I’m not an idiot like the rest of these people
People may need a car for work but they want a brand new $60k or higher SUV.
Dealerships love it because they get commissions on finance deals and usually the cars have to come back to named dealers to get service and aftersales work done (which is where most of the profit is).
@@Joey_DiGs that's everything my dude you don't need a color TV lol or 70 inch 4k one you just want them you don't need a new iPhone every year. I get what you're saying but no one asked car manufacturers to make new cars every year and to only add apple carplay like 3-4 years ago... If car manufacturers weren't sk dumb and greedy and made a new model every 2-3 years inflation would be less prices would be lower and used market would be stronger
@@mrtoad1408 a rav 4 starts at 27-28k and you can barely find the base model then you get a model you do like and it's 3-5k over sticker that's no one's fault besides manufacturers and dealers. Most new cars are way too expensive a Hyundai Kona starts at 23-25 k shit should be like 18k on a good day lol
I had a car loan for 7 years, but it actually made sense as the interest rate was only 1.9%. Even mortgages at the time were around 3%. Now the car is paid off, and I’ll hang onto it.
The biggest wealth killer is not shopping for the best deal, from the daalership and the best loan conditions. Do you need to pay $50k for a car. Do you need to buy new.
This is key, go to several dealerships and negotiate the terms. I just find it crazy that every dealer will give you different prices and terms for the same car
@@2shorttt10 just get a very slighty new car and pay cash, thats how im gonna buy me a mercedes, or a hellcat.
@@gsst6389giant waste of money but it ain't mine so do what u want
People be like college is a waste of money and then get a 80k car loan for a truck.
The borrower becomes the slave to the lender.
Currently live without a car since I'm in NYC, but this is why I'm just going to purchase a used EV in cash when I need one. I don't need the newest model or anything fancy. I prefer EVs because they get some decent perks such as parking and express lanes. Used Model 3s go for under 30K. I'll happily pay cash for that and use it for the next 10 years until I have a decent grasp on other finances like a house. I hate owing more than 1 type of debt and right now student loans are the only debt I have at just 22K.
Only 9%?? 22.6% was a buddy mines quote for a new work truck like 3 months ago
22.6% ?!
That's a robbery without the gun. 🥴
This is very true. There is absolutely no reason to lease or buy a car with a loan. Buy a car that you can afford to buy in cash and consider maintenance, gas, insurance. There are infinite options for cars up to $10/20K. And when you are done after many years it still has equity. Watching a lot of the Caleb audits and having some friends that lease or take a loan on cars that have such high interest rates is financial illiteracy. This will crush you unless you are making well over 6 figures.
And yes 25 k was enough for brand new car. Salaries then were already deviating very rapidly from acceptable debt levels ..
Looks out at the barren hellscape of eighteen lane freeways. "Yes. How did this happen. Who could say. Truly a mystery."
It's SUV's, 25k still gets you a brand new, mid trim commuter sedan but everyone thinks they need an suv to get to work when for the vast majority of people a corolla is more than enough to get you there and back and it's significantly more efficient.
It isn't just SUVs but trucks are included in there. $50k to $75k for a new truck is around a 20% of a typical mortgage at a higher interest rate. I get it if you need the towing capability, 4WD capability, or the carry capacity if you're working construction, but alot of truck owners rarely need these.
I live in an area that gets a lot of snow so you need at least an SUV with AWD. But I got mine brand new at 26k during covid with 4% interest so it isn't that bad
I live in an area made famous by snow and mountains, I drive a Fwd corolla, an awd camry will do the same thing with a lower center of gravity to avoid tipping, significantly better gas mileage, better visibility, and it's way easier to stop on slick roads. If you want an suv that's fine but unless your getting stuck in the mud on a regular basis you don't need it
@djthegrim Most people didnt have AWD up until recently, AWD was extremely uncommon and people survived just fine. You can justify your purchase all you want
@@djthegrim i live in Sweden. never had an awd car. and most people dont.
what you need are winter tires.
Barring some exceptions, the biggest wealth killer is actually a lack of restraint.
No one *needs* to pay 50 grand on a car.
People who spend 50 grand on a car just want *that* car rather than another less expensive car.
And hey, I get it. Nice things are nice; agreed. On the other hand… a car at half the cost will still fulfill its key purpose in basically the same way as the 50 grand car.
The key purpose is the “need” (transportation for work/life) while the latter half is for luxury.
Not trying to be harsh, but if the only way you can pay out 50 grand is to take a loan, you shouldn’t spent that 50 grand on luxury. Choosing a less expensive alternative will be much better for you in the long run and you’ll be glad you did. Maybe not that day, but in the end you will be glad.
Let's be honest, the biggest wealth killer of all is people having to spend 50% of their income on their mortgage or rent
But the root problem is the same. People buy too much car, too much house, too much education, and too much stuff, because they can "afford" the payment.
If everyone refused to go past 25% of their monthly income on their rent or mortgage, prices would be forced downward.
@@randyh801no dude people buy/rent shelter because you need it to live, not my fault the minimum available is 2/3 my income
@@randyh801refusing to go past 25% on rent is gonna end up making most people homeless
@@randyh801oh so that's why we have a homeless problem!
You can live in a car for a bit or an anb.
You can still get great economy cars for around $20k give out take a few grand. Our Impreza has been great. 9 years old, ~306k with pretty normal maintenance/fluids.
Because it is Required. 100%. No reliable car? No job, no money, stress because of bills, debt, no social life, no Relationships, it is required to have a decent car these days.
It is but buy a $8000 car instead of financing a $35k one
My husband drives a 2008 Nissan Altima he purchased over 2 years ago for 1K….. he drives it over 60 miles a day into the city for work. It’s very reliable. Drives it in the snow. Before that he had a VERY old Corolla that he drove into the ground. Does it need some repairs once in a while? Sure. We’ve spent maybe $700 in the last 2 and a half years. Certainly beats a car payment. Old cars can be very reliable. Do your research and purchase wisely. You don’t need to have a high car payment to equal reliability in a vehicle. It’s a lie that consumerism has taught us.
And that is unfair. That is why accessible and low cost public transportation is needed
That doesn't explain why ppl stretch their finances to get a $60k car. It's because ppl want shiny new things and convince themselves they deserve it.
I promise you our 2004 Toyota Corolla is quite reliable. Probably more so than a luxury brand of car. Friends of ours had a BMW and they ended up getting rid of it because it was such a pain to fix and it was always breaking down. We meanwhile are still driving that Corolla.
9%!!!!!!!!!! Forget the stock market. Is there any platform I can use to invest on car loans?
That's the best part about being a mechanic because I can buy cheap and fix Maximum , i'm going to pay for a car to git me a to b to 3000 Dollars Well , my daily right now paid 700 for it Yes, it's reliable
Own 15 and 22yr old Toyotas. Haven't had a car loan in 10yrs. It really helps. Stop buying domestic garbage, learn a little diy and maintain the vehicle.
25 grand "back in your day" WAS worth 50K in today's destroyed currency. Cars didn't go up in value, your money went down in value
Not true, a brand new corvette in 2020 was 57K, an honest price. Chevy realized being honest was a mistake and quickly raised it 20K, now I think it’s closer to 80-90K. BUT A corvette is a luxury sport car, a damn Nissan maxima with cool features and “sport” mode should not be the price of a damn luxury car.
No but sure
Bitcoin fixes this
no man, your salary couldn't keep up with inflation, so your purchasing power decrease
Yea. 10 years ago in 2014 minimum wage was $8. Now in 2024 minimum wage is $16 - $19, double the amount and yet people are still broke, people still can't afford a new car, afford a new home.
"back in my day" 😂
Working in the auto industry, it's commonplace for people to get a high repair bill on a 7-8 year old car, and decide to trade it in on a new car. So they go from a $1500-$2000 bill, to a monthly $800-$1000 bill. I never understand why they make that decision.
It boggles my mind too.
Any little excuse to get a new vehicle, I guess.
It's the concern that when they pay that $1,500-2,000 bill, a few months later there will be another one. And then another one. And then a $3,000 replacement of some engine component. Then $5,000 before the transmission needs repair...
People like the consistency of paying one flat payment and not having to worry about repairs or breakdowns.
@@MetalSandman999 Yeah I imagine that's the justification people use. Reality is, most vehicles last with minimal problems as long as they're cared for. Expensive repairs happen on new cars too. Even if you let a car get worn out, get a used car with a warranty that covers big stuff. New is for people who don't blink at losing $10-15k of value over the first year. Or toys, like a new Corvette you'll keep forever. 10 year old clean car with maintenance history is what I like, but I also don't pay for labor.
The truth is that the car industry has invested so much money into making this country absolutely dependent on cars, and year after year, they've made cars bigger, meaning they cost more, and have taken the smaller models off the market.
So something that has become essential keeps getting more and more expensive.
I had an ass pain trying to bridge the gap of buying a vehicle after my truck crapped out that was worth almost nothing.
I had to get something reliable but also without crazy mileage and somehow either affordable all cash or a manageable payment.
I went the new car route. 26K sedan. Brand new. 6 year fixed rate. 360 a month payment. Was a necessary evil for me.
You can't buy reliable used cars for 5k anymore. And for those who claim they did, you are an EXCEPTION, not the norm.
360 a mo would be a damn good deal currently
@@GOmegaPHD Yep. Had the car for 6 months now.
The fact a lot of new cars are crazy unreliable, look at Ford eco boost engine that now they have the timing chain (but still the wet belt for the oil pump) look at the pure tech engine that the stellantis group uses they are crazy
@@alessandromelis2074 planned obsolescence. The fact that certain parts of Toyota cars are showing that philosophy tells you everything you need to know about the reality of this world
@@smamq yes I have an old lancia y 1.1 and I will keep it forever
What’s crazy is trying to get a good car now is stupid expensive. RAV4 from 2018 with 70000 miles on it will run you like 26k!
Kinda sucks when you design your entire fucking country to be 100% dependant on cars huh?
@@Sn1zzle It sucks even more when car manufacturers aren't designing cars for the wages of the average worker.
He’s wrong. It’s RUclips. Wasting time watching RUclips is the wealth killer. See in this video, only one person made money while you watched.
Literally millions of people made money while you watched - we’re called “shareholders.” ;-)
My grandpa is currently leasing a car through the chevy dealership and it is time for him to upgrade. The salesman told him that his income isn't enough to get the car he wants (a malibu). Which is crazy because my grandpa worked for GM for 35 years, and retired out with a pension. He even receives the employee discount, and he has no debt. The cars are becoming ridiculously priced for what they are.
Cars just cost more than they used to. Cars “back in my day” had no luxuries. Now cars aren’t made without all the bells and whistles, hence why they cost more. Not to mention inflation right now.
Just remember, that’s only a piece of car ownership costs.
Collectively as a society, we are enriching the automotive, oil and insurance industries and we collectively spend literal trillions every year on car ownership alone.
If we returned to the old way of city building with functional public transit and mixed use walkable neighborhoods, we could save hundreds of billions of dollars by barely even really trying. Remove arbitrary parking minimums, remove ultra restrictive exclusionary zoning and the free market could easily solve the housing crisis and end car dependency
I agree with the spirit of your comment but would replace the description of easily with eventually.
Yet look at the rent and real estate costs in public transit majority cities. They're exponentially higher. A vehicle, as built in the 60's and 50's, proved out to be an asset. Now we charge nearly $100k for a luxury car that us built to last the length of the lease.
The thing to do would be to force automakers to underwrite their vehicles and make all auto loans 10-15 year loans, thus forcing improved quality standards on the automakers lest they be left saddling worthless debt on badly built vehicles.
Simultaneously, kick the Hedge Funds out of the Single Family Home and Condo Markets while also opening up all foreign owned "static asset" real estate to the rent controlled market or see to it that the foreign owner spends at least 9 months a year there or, if they don't wanna be subject to rental, they'll be subject to sell or auction.
If you rally wanted to be a leader, you could also then redistribute the wealth housed in the non-taxable University Endowments to pay down the student debt which would also result in University's cranking out students with market value degrees at a higher rate due to the need for fresh donor classes to refill those Endowment Coffers.
@@c.s.s.5326
They’re exponentially higher for a start because of how scarce they are, and secondly, because misguided politicians, including democrats and progressives have bought into the suburban experiment mythos.
There’s a good video I watched a while back which can actually shed light on what I mean, it’s by a channel called “Oh the Urbanity!” And iirc, the video was called “how the housing crisis breaks the political spectrum”. It goes into detail how several political ideologies play into the modern political debate surrounding the housing crisis and how to solve it.
I also don’t feel that the solution to the housing crisis would be to double down on building out the car purchasing apparatuses that currently exist. That was of course how we wound up with the current status quo of home purchases, where 30 year mortgages were tied to the idea that the only home that is suitable to own is detached single family homes, and so banks only loan to purchase homes for suburban sprawl
Rent is high in transit rich cities because there is a lot of demand and not a lot of supply.
@@rlbond Among a myriad of other factors. The base setter being woefully simplistic supply and demand.
"Back in my day" lol
I’m sure cost of housing is the biggest killer of wealth since that is most people’s largest expense.
yea, a morgage on a starter home is now 3000 a month.. Its where the majority of peoples incomes go,
We bought a house in London in 1998 that within 5 years we literally could not have afforded to rent. Only took a car loan out for one car, which was new and kept it for 13yrs.
@@airgunningyupjust bought a home and my mortgage is $1250/month not including taxes PMI and HOA with $10,000 down.
@@jackbrown5184 was it a VA loan , you must have a good rate ..
@@jackbrown5184sounds like your home has wheels under it 😂
Because I had shit credit at the time my car loan was 19%. Thank God I paid it off years ahead of time
Worst part is the new cars are off worse quality and require more repars
It's not just bad quality, it is also about putting a lot of tech in your car. For instance giant ass screens, huge sunroofs etc. This increases the overall maintenance and not to mention adds more points of failure.
That's inaccurate. The repairs are more expensive but the cars need a lot less repairs than before.
@@oemj7147 THIS, is inaccurate. Japanese cars of the 90s, 00s, and early 10s were rock solid. Nissan was bought by some Euro trash company and the CVTs killed them. American cars, trucks specifically, have become far too complex. Too many idiots buying BRO-DOZERS out there that have more tech than a 2018 Honda Accord. Just stupid.
@@justinmcroberts4633 Totally accurate. I had a 1991 Honda Prelude that was drinking 1 quart of oil per thousand miles with only 70K miles on it. Had a 2007 Accord that needed a transmission replacement at 12k miles and was a rattle trap. Not as reliable as you think.
Well, at least the Prelude was fun to drive.
Everyone got shifted in expectations.
Cars are the new houses.
Pets are the new kids.
Plants are the new pets.
Kids and homes are too expensive.
We also grew up where our parents didn't constantly go out to eat, McDonald's and pizza once a week was a treat for us! They couponed for groceries. They didn't have monthly payments besides their mortgage. They took a sack lunch to work and made their own coffee. My dad kept 2 of his Nissan trucks from the early 80s running for 30 years. Now everyone is crying and people are making fun of them if they don't have the newest iPhone. Debt to LOOK wealthy has become a TREND.
@@BrassBashers really good points and way to remind people. It's like selective nostalgia
So many people justify a “more reliable vehicle” at $750 per month vs buying something you can afford and saving $750x12 is $9,000 incase there is a repair. I’m glad I’m not into fancy vehicles.
A good Chevy truck is in the range of $80k to $100k it’s outrageous
no such thing as a good one.
Don’t buy that then, buy something else
an 80k truck is one side of the coin, some idiot has to actually buy it
No such thing as a good Chevy, Dodge or Ford turck.
@@human1513 mhm so tf are you supposed to tow trailers 🤡
I'm done with new cars. I have a 98 Ford Ranger with almost 340,000 miles on it and the engine runs like a top. Regular maintenance is the key.
Thats when Ford actually made simple, good trucks.
Car loans, and eating out, buying coffee
Food is a silent killer i remember when I first started working and I spent almost 1k on eating out never again will I do that. And my boys as we made more money they ended up spending 12k on DoorDash alone in just 1 month.
The problem with everything is excessive debt. Finance capitalism at its finest. 😳
taxes biggest killer not loans
Simple one word answer.
TAXES
FACTS! Pops always taught me to buy cars cash, if you must finance, then you cant afford it.
Even with inflation you can easily get a nice new car for $25k, and if you have decent credit can get
Where are you getting 4%?
@@shelleygreyrealtor no kidding, I got 7% with an 810 fico
Cheapest new 2024 starts at 19-20k. Nissan versa and it's engine leaves a lot to be desired. Car prices have skyrocketed
Buy a crappy car with cash and have huge maintenance bills where you need a loan or get a loan get a car that you won’t need to fix up right away… hmmm so many good choices
Old Toyota or Honda
Huge? Lol you drop a couple grand on major fixes and you're guaranteed for 5 years minimum. Total cost spend you'd STILL be paying lower for a base, brand new car after depreciation lol.
They've normalized a $1000 a month car payment... Prices skyrocket during covid due to scarcity. Now inventory has been restored but prices have remained... It's intentional.
back in your day 25K brand new car? how old is this guy. and no not buying the BOOK
That was literally like 10 years ago lol
Brand new Honda civic was $15k in 2005
I bought a brand new 2020 Civic (base model LX) for 20k out the door, with 0.9% interest, right before the prices skyrocketed. Sadly, will never get that kind of a deal again
29yrs ago a fully loaded brand new Toyota 4 runner cost me 25k. Want to guess or maybe look up how much a fully loaded 4 runner is now? You might find a 2024 for 50k, however they jump to 85k+ real quick....
“Back in my day” like he is 80 years old 😂😂😂😂
We live in a car dependent hellhole. This wouldn't be an issue if our cities let us get around conveniently without driving.
A “shit hole”. There is public transportation???
@@user-xd7jh4ih4gthat is terrible compared to less civilized countries.
Bro, I work for Boeing. Yes, the main plant in Washington. I can’t even afford driving lessons.
Thankfully because of videos like this, I didn’t fall into the new car trap. I keep telling myself I gotta wait until I’m debt free to buy myself a nice car lol
Why did cars go from a necessity...????
They never truly are for most people. Car companies lobbied, and still do, for funding, development,and projects that decrease walkability and/or transit feasibility. A manufactered need.
Imagine how much $200/mo more would mean to a person making 35-40k living in a $1200/mo studio/1 bed apartment. If car dependency wasn't so rampant, low income households would have that extra money. For reference, my math assumes $100 for a transit pass, $100 for gas, $100 for insurance, and $100 for a car payment each month. 100 is low for gas from my personal observation. 100 for insurance varies, but it's quite conservative for most people I've asked. Now, one might not have a car payment, but I also didn't account for the average monthly cost to maintain/repair the vehicle. In saying that, I think it's safe to assume that $200 is near the low end of what not needing, and not having, a car would save. Also, I don't know about you, but I think the economy would do better with $200+ more in even 10-20% of the households who are in the bottom 50%.
That's if we got rid of insane car dependency. It's like a UBI, for non-car owners, but the government spends quite a bit less when car dependency isn't a problem because transit still takes payments to offset the costs. Seems like a win to me.
What blows my mind is people will pay anywhere from 1k -2k for a car a month including insurance and gas payment ect. Just to drive it to work have it sit 10 hrs and drive it back home. They are scared to put miles on it because it’ll lose value lol
His flabbers were gasted 😂💀
I disagree the problem is car loans are high because people buy things they can’t afford… and on top of that get more than 1 car (more than they need) and they either can’t afford it or need it.
As someone who pays 7k / month in taxes, I can assure you it isn't car loans.
It’s against compliance regulations to turn away a customer who wants us to submit them for financing for a vehicle regardless of their situation. It’s all on the lenders and the customer. Customer can walk away and say no to the lenders terms.
Is it better to buy or lease?
Young man: "Back in my day..."
What blows my mind is the fact he's blaming the consumer for all the cars being $50k.
Never had a car loan.. just pay cash and what you can afford
That's car dependancy for you
I don't plan on changing from the Mk7 fiesta till I can buy the car I want outright (20k for m340i)
First car i ever financed was in 2014 and it was brand new for 22K and im ASTOUNDED by the fact that i can barely find a brand new Accord or Corrolla for that price. Used cars arent much better either. 10 year old cars from a generation or two ago going for 15+ like, my brother in Christ, this thing doesn't even have Bluetooth audio, 6K take it or upgrade the radio at least.
I have a car that I bought new 14 years ago. I thought about replacing it with something new. However the mere idea of getting into debt just to do exactly the same thing I do today already puts me off immediately.
Me & my wife have never owned a credit card, we've never spent any money that didn't save 1st. Except our mortgage which we paid off 15 years ago. We've only earned the average wage in the UK our whole lives. But getting no debts was the best thing we've ever done financially. I'd advise everyone who can get by without getting debts to do so. A car is a tool to get from A to B. No matter how fantastic you believe you are because you've got the latest & greatest car you can get debt for. There's nothing fantastic about most of your wages being paid out on debts. Live within your means if you can, sometimes it's hard but it's worth it.
Too much House 🏠
Too much Car 🚗
Too much Holiday 🎉
"Back in my day is was 25k"
Bro are you sitting here trying to claim people only bought cars they could afford in the early 2000s? Seriously?
You have to turn the liability into an asset. If the car puts money in your pocket, it's not a liability.
I honestly thought that he was going to say wives are 😂😂😂😂
People living above their means is still what drives this debt. I could have paid cash for my car but took a loan at 1.9% because that money makes more invested elsewhere. Even my high interest savings account is 4.9% I always pay my cc balances in full every month and use the points or cash back. After doing this for the last 30 years I’ve maintained an 826 credit score. It’s not hard, you just have to have discipline and don’t spend money you don’t have. Also, new car prices are hideous, the loans are worse and the market is dropping out from under them which is good, they’re insane charging what they do and these things depreciate faster than a jar of mayonnaise left in the sun.
Until the american car companies actually allow vehicles that are new, reliable, and affordable to the common citizen, the market will continue to drop out of those insanely overpriced vehicles. Idgaf give me a manual transmission, roll up windows, no "infotainment" I mean maybe a hundred bucks to get it to hook up Bluetooth, and basic safety.