re: The average monthly new car payment in 2022 is $644

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pretty much any financial expert will sway a buyer away from a long term car loan (over 5 years). You can google that if you like. I DGAF.

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When have I argued for long loan terms?

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Wealthy people don’t finance much.

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Depending on interest rate, I will use bank money for purchases while my money continues to create more income.

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Depending on interest rate, I will use bank money for purchases while my money continues to create more income.

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Bingo. And generally limit the money you spend on rapidly depreciating assets and crap, and invest that cash in markets, real estate. etc...

Or still be paying a mortgage when you're 80. I really DGAF.

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I will never have a car loan I am paying 644 dollars a month on.

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Never thought I would either. But in February, right before COVID, I bought 2 cars. One for cash, and I could have purchased the 2nd with cash, but they were offering 0.9% loan, so I took the 0.9%. $700 a month now.

Our timing on the purchase was impeccable. I certainly didn't want to buy 2 cars in 3 days, but my wife talked me into it and she was smart. If we were to sell both today, we'd be +$10k on the transaction.

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My personal threshold is around $550 for a vehicle note.

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I limit months not note. 48 is my max

Makes for higher notes

First link mentions >4.5% rate

Normally we've bought my wife a "new" car every 6-7 years. New meaning 1-2 year old low mileage vehicle. We budget $600/month for car payments and it goes into a savings account which is the cash we use for big splurge purchases. When the car payment is less than $600 the savings account grows and we have more money to blow on other stuff. The sytem has worked well for us over the years.

She's had her car for going on 8 years now it's been paid off for the last 4 and it's at 80k miles. When Corona started we were looking at Tellurides/Pallisades but she decided she liked not having a car payment as it gives us a lot more cash flow for traveling and vacationing. We're to the point in our lives that traveling and having life experiences with our son is more important that having a new car in the garage.

I normally get the wife's hand-me-down when she gets something new. I work from home and don't really do a lot of daily driving. I decided I wanted something that could tow a 5k camper and would be big enough my son and I could camp out of it at the mountain bike races we go to. I also wanted something older that I could work on and has enough technology to make it reliable but not enough to make it difficult to work on. Found a clean no rust '05 Toyota 4WD Sequoia with 151k miles. Timing belt done at 138k. Ball joints at 123k. Good record of oil changes. Former Arizona vehicle so no rust. $8.9k paid in cash. I figure with a little preventative maintenance I could easily get another 100k+ or more miles out of it which might last me 7-8 years at my current average driving pace. I plan on outfitting it for overlanding to run the White Rim trail in Canyonlands which is a bucket list item for me.

Thanks for the insight

5 year auto loans werent even a thing until the late 70's. Now we have 10 year auto loan terms and, as cited in the article, the average term is up to 6 years.

That should tell you all you need to know.

Today, the average family income is 67K.
In 1980, the average family income was 21K (72K in todays dollars). The average family isn't richer, yet they have waaaaay higher-end shite. How? Long-term financing.

depends on the rate and terms, but I agree. credit should be leveraged, not relied upon to bridge the gap between the wealth you have and the wealth you want to project.