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Message
An OT topic reminded me of something Dave Ramsey is flat out wrong about
Posted on 6/8/15 at 11:20 pm
Posted on 6/8/15 at 11:20 pm
LINK /
Don't get me wrong as I enjoy Dave's show and think he's right about alot of things and makes the right call on alot of his advice, but one thing that he STILL pushes today in 2015 the same way he did 10 or more years ago when I first heard his show is the "$1,000 beater car."
He's totally out of touch with the reality of the used car market these days. He still thinks that the used car market has enough $1,000 cars to go around and the vehicles actually run and will get you to work and back each day. He also seems to think that the market still has a ton of two year old, low mileage cars that are 30% or more less than what they cost new. Constantly he tells people that you can find something like a two year old Camry from $15,000 etc.
One day last week I remember him telling a young guy that drove a beater that he should take about $5,000 cash out of the bank and move up in car. He told the guy something along the lines of "That should buy you a five times better car than what you're driving now. You know, something reliable and a couple years old with low mileage, something that someone's grandma drove once a week."
Anyway the OT topic got me thinking about this, but the money board seemed like a better spot to mention it since I know alot of us here are fairly well versed in Dave's idioms.
Don't get me wrong as I enjoy Dave's show and think he's right about alot of things and makes the right call on alot of his advice, but one thing that he STILL pushes today in 2015 the same way he did 10 or more years ago when I first heard his show is the "$1,000 beater car."
He's totally out of touch with the reality of the used car market these days. He still thinks that the used car market has enough $1,000 cars to go around and the vehicles actually run and will get you to work and back each day. He also seems to think that the market still has a ton of two year old, low mileage cars that are 30% or more less than what they cost new. Constantly he tells people that you can find something like a two year old Camry from $15,000 etc.
One day last week I remember him telling a young guy that drove a beater that he should take about $5,000 cash out of the bank and move up in car. He told the guy something along the lines of "That should buy you a five times better car than what you're driving now. You know, something reliable and a couple years old with low mileage, something that someone's grandma drove once a week."
Anyway the OT topic got me thinking about this, but the money board seemed like a better spot to mention it since I know alot of us here are fairly well versed in Dave's idioms.
7
Posted on 6/8/15 at 11:29 pm to Huey Lewis
Posted on 6/8/15 at 11:34 pm to RadTiger
But isn't a new camry about 18k? A year newer, no miles.
Posted on 6/9/15 at 12:16 am to LSU1018
Im not a Ramsey fan anymore but I think he talks about beater cars in theory and not necessarily in up-to-date facts. You're right, he's out of touch with what the used car market is. I think what Ramsey is trying to tell people is that they shouldn't go more into debt to buy a car which is out of the means. Some people have no business driving the cars they do when they have 20k in credit card debt.
Posted on 6/9/15 at 6:47 am to Huey Lewis
DR is wrong about something?
Posted on 6/9/15 at 7:17 am to Huey Lewis
I'm in the market for a vehicle, and it sucks.
Want something decent under $10k? You're going to get a true beater. A vehicle that has at least 125k miles on it if you're lucky.
Perhaps you can find a deal here and there. That's what I'm hoping for. I scour Craigslist and the classifieds and other websites daily hoping to see that one deal pop up.
The other issue is that banks don't like lending money for older cars.
So for someone like me who is just now getting my finances in order, I don't have the cash in the bank to throw $10k at a new vehicle.
Want something decent under $10k? You're going to get a true beater. A vehicle that has at least 125k miles on it if you're lucky.
Perhaps you can find a deal here and there. That's what I'm hoping for. I scour Craigslist and the classifieds and other websites daily hoping to see that one deal pop up.
The other issue is that banks don't like lending money for older cars.
So for someone like me who is just now getting my finances in order, I don't have the cash in the bank to throw $10k at a new vehicle.
Posted on 6/9/15 at 9:14 am to Huey Lewis
There are a few issues here
1) Dave is very wealthy now, and good for him, but he's remembering what it was like to be poor 10-20 years ago.
2) Cash for Clunkers sucked a bunch of used cars out of the market and replaced them with new cars that are still running very well
3) Dealers are playing games on trade-ins, offering artificially high prices om trade-ins to get people into a new car. They then believe this artificially high price is the base at which they must now sell this used car.
4) There is still one way to get an awesome deal on a used car: the auto auction. However, you need to be a dealer to go and bid. My FIL bought a 10 year old compact car for my niece for $900. Had 104k miles. Needed new tires and about $300 in engine work and it runs like a top now. His buddy has a dealer license so he went with him to get it.
1) Dave is very wealthy now, and good for him, but he's remembering what it was like to be poor 10-20 years ago.
2) Cash for Clunkers sucked a bunch of used cars out of the market and replaced them with new cars that are still running very well
3) Dealers are playing games on trade-ins, offering artificially high prices om trade-ins to get people into a new car. They then believe this artificially high price is the base at which they must now sell this used car.
4) There is still one way to get an awesome deal on a used car: the auto auction. However, you need to be a dealer to go and bid. My FIL bought a 10 year old compact car for my niece for $900. Had 104k miles. Needed new tires and about $300 in engine work and it runs like a top now. His buddy has a dealer license so he went with him to get it.
Posted on 6/9/15 at 10:32 am to Huey Lewis
The principle is sound though.
$3,200 got me a 97 Camry with 117,000 miles on it rom craigslist for my teenagers. Runs great and has cold AC. As soon as I got it home I took it to the dealer and had a new water pump and timing belt put on it for $800.
5 years later my teen daughter drove it for her 16-19 years and now my teenage son has driven it for his 16-18 years.
And all that time it's getting 30+ mpg and I'm just carrying minimum liability on it.
I will sell it next year for $3,200....
$3,200 got me a 97 Camry with 117,000 miles on it rom craigslist for my teenagers. Runs great and has cold AC. As soon as I got it home I took it to the dealer and had a new water pump and timing belt put on it for $800.
5 years later my teen daughter drove it for her 16-19 years and now my teenage son has driven it for his 16-18 years.
And all that time it's getting 30+ mpg and I'm just carrying minimum liability on it.
I will sell it next year for $3,200....
Posted on 6/9/15 at 10:38 am to Old Sarge
I just sold two Volvos with plenty of life left in them; trade value was absolutely stupid. Both were 12+ years old, very very well maintained, with ~150K miles each. Sold one for $2,500 and the other for $3K. Could have driven them for another 50K miles, but 0% financing on a brand new car with far better gas mileage is money in my pocket.
There are certainly good deals left in the used market. Too many people worry about potential repair costs that may never materialize....
There are certainly good deals left in the used market. Too many people worry about potential repair costs that may never materialize....
Posted on 6/9/15 at 10:46 am to StringedInstruments
quote:
So for someone like me who is just now getting my finances in order, I don't have the cash in the bank to throw $10k at a new vehicle.
So buy a brand new "beater" car for under $13k. It will have zero miles, a warranty, just as many features as "better" older cars, and you can drive it into the ground. Won't have any problem getting a new car financed, and you'll be able to maintain it correctly.
Posted on 6/9/15 at 10:52 am to LNCHBOX
quote:
So buy a brand new "beater" car for under $13k. It will have zero miles, a warranty, just as many features as "better" older cars, and you can drive it into the ground. Won't have any problem getting a new car financed, and you'll be able to maintain it correctly.
You know of a brand new $13k vehicle that can transport two kids, a dog, and luggage? I also have a pop-up trailer which saves on hotel costs and allows for some extra vacation opportunities. Weighs about 2k pounds.
If you know of one that can handle that, I'm all ears.
Posted on 6/9/15 at 11:01 am to StringedInstruments
quote:
You know of a brand new $13k vehicle that can transport two kids, a dog, and luggage? I also have a pop-up trailer which saves on hotel costs and allows for some extra vacation opportunities. Weighs about 2k pounds.
If you know of one that can handle that, I'm all ears.
Did I mention that those beater Volvos I sold will tow up to 2K pounds? Towing capacity on domestic sedans is nonexistent. The US mfgrs force you into a wildly overpriced crossover or small SUV class (with absolutely awful gas mileage), while the Euro mfgrs still offer passenger sedans with towing capacity.
Pare down the trailer weight to ~1500 and you can pull it with a VW Passat. Just put a hitch on my better half's new Passat & it handles my 14 ft wooden flatboat/trailer/motor with no problems...even up the boat ramp, LOL. I have always gotten funny looks rolling up to the boat launch in my relatively small euro sedans, towing a boat. Whatever...I'd rather get good mileage every damn day than drive a bloated SUV or gas guzzler truck when I only pull a trailer 2x a month at most.
You sound like a potential customer for a used Subaru.
Posted on 6/9/15 at 11:25 am to Huey Lewis
He also still uses 12% growth as his assumption. In his "never have a car note again" example, it really shows its flaw IMO
Posted on 6/9/15 at 12:24 pm to StringedInstruments
quote:
If you know of one that can handle that, I'm all ears.
Kia Soul?
I have no idea.
Posted on 6/9/15 at 12:42 pm to Cdawg
I think they are ugly but someone at work got a Kia Soul and absolutely loves it for the price. Wife drives a BMW X5 and he drives up in his Soul like a boss ha
ETA: he understood what he was buying and wanted a big warranty mode of transportation that was new. He didn't give a shite about looks/useless amenities
ETA: he understood what he was buying and wanted a big warranty mode of transportation that was new. He didn't give a shite about looks/useless amenities
This post was edited on 6/9/15 at 12:44 pm
Posted on 6/9/15 at 12:45 pm to StringedInstruments
quote:
You know of a brand new $13k vehicle that can transport two kids, a dog, and luggage? I also have a pop-up trailer which saves on hotel costs and allows for some extra vacation opportunities. Weighs about 2k pounds.
If you know of one that can handle that, I'm all ears.
Well, you didn't really give all those details
I would say selling the pop up and adding the additional fuel and insurance savings of not having a truck or SUV would pay for more vacation opportunities, or at least break even. ETA: I'd love for whomever downvoted my previous post to tell me why.
This post was edited on 6/9/15 at 12:53 pm
Posted on 6/9/15 at 1:43 pm to Huey Lewis
My son just sold a Kia Optima with 100K miles for $1200.00, it had some minor cosmetic damage, but was a great running car that had at least another 50K miles in it.
Posted on 6/9/15 at 1:57 pm to StringedInstruments
quote:
Want something decent under $10k? You're going to get a true beater. A vehicle that has at least 125k miles on it if you're lucky.
That's simply not true. Sure the used car market is overpriced right now, but you can find plenty of good cars that will give you easily 5+ years for under $10k.
And 125k is not that many miles these days, especially for Japanese cars. Honda's and Toyota's run well into the 200's if you take care of them.
quote:
I scour Craigslist and the classifieds and other websites daily hoping to see that one deal pop up.
I think your problem is you're just being very picky and have too high of expectations.
This post was edited on 6/9/15 at 2:03 pm
Posted on 6/9/15 at 2:10 pm to rintintin
quote:
I think your problem is you're just being very picky and have too high of expectations.
They call them "beaters" for a reason, most people are just unwilling to buy something with bent sheet metal and bad paint. If you forget about cosmetics and just look for a solid drivetrain there are cars out there. A friend just bought a Volvo S80 for his daughter for $1800.00. A solid, safe car with a lot of life left, but had a dent in the roof that looked like a meteorite hit it.
Posted on 6/9/15 at 2:17 pm to LNCHBOX
quote:
ETA: I'd love for whomever downvoted my previous post to tell me why.
Ha..maybe you've attracted the pro-Dave serial downvoter! Welcome to the club.
OP needs a used Volvo v60 wagon. Towing capacity is huge for a non-SUV (something like 3300 lbs, better than most small/mid SUVs), decent gas mileage, and pretty widely available on the resale market. Better used prices than Subarus (which don't have as much tow capacity as you'd think).
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