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Started By
Message
re: The Great Car Bubble
Posted on 8/5/23 at 10:47 pm to GREENHEAD22
Posted on 8/5/23 at 10:47 pm to GREENHEAD22
quote:
am between a rock and hard place. Have a 16 Z71 in good condition, 125k, been paid off. Problem is its a POS, onits 2nd transmission, top end motor redone, 11k in repairs. And now it's having engine cooling and electrical issues.
Similar situation with my POS 2018 z71. 105,000 on the odometer and already replaced the transmission. Stuck lifter repair job cost me 4K. A few weeks after the lifter job I had a clogged cat converter which was around 3K.
0
Posted on 8/6/23 at 7:55 am to rintintin
quote:
I don't think people spending 20% of their income on a car note is sustainable.
Yep, its called 'car poor'.
Untold millions are slaves to their vehicles making those notes for the next 7-8 years.
They get all star-struck and pumped up thinking about their new car/truck, not realizing they took a 15-20% depreciation loss the moment they drove their shiny new vehicle off the dealer parking lot.
Buyers remorse sets in but its too late. They are upside down in a piece of overpriced piece of crap.
Once they get that piece of crap paid off, they may get a couple thousand on a trade-in.
Best advice is to use the 20/4/10 rule when purchasing a vehicle.
20% down payment, finance for 4 years and no more than 10% of monthly income.
Unfortunately the opposite is the norm. That why lots and lots of folks are going to have to work until they fall out dead.
Posted on 8/6/23 at 7:59 am to rintintin
Just wait til you have teenagers and have to buys cars and insurance. The insurance is as much as the note!
Posted on 8/6/23 at 8:44 am to Reubaltaich
quote:
20% down payment, finance for 4 years and no more than 10% of monthly income.
Can’t argue with anything you wrote. And using your math, that is $160k per household before taxes for a $1k note. That is not very difficult to achieve.
Posted on 8/6/23 at 9:06 am to kciDAtaE
quote:
Can’t argue with anything you wrote. And using your math, that is $160k per household before taxes for a $1k note. That is not very difficult to achieve.
Not so easy in Louisiana where the last I saw the average household income was under $30k/year. I would not be surprised with inflation if it has not grown to close to $40k/year now but we are still talking half of one half of the household your math requires.
Posted on 8/6/23 at 9:13 am to ob1pimpbobi
quote:
Downvote away, but a no interest loan for 3 years is better than paying in full.
This is just basic finance. It blows my mind that people don't get it- even otherwise smart people.
As far as the overall topic of the thread goes, my first thought was that these numbers are driven by suburban families engaged in social climbing.
I think it goes deeper than that, though. Both my parents and my wife's parents are people of modest means. Mine live in a condo and hers live in a rental house. Neither family is materialistic. Dad's idea of a throwdown is pot luck with the Knights of Columbus topped off with a Columbo rerun. And yet both families drive truly gigantic late-model SUVs.
My dad drives his all over the place. Took it to Omaha. But a "road trip" for my in-laws is a trip to the Olive Garden in Alpharetta. I don't get it.
This post was edited on 8/6/23 at 9:16 am
Posted on 8/6/23 at 9:17 am to rintintin
Simple Sutton solution. Let’s say those same people have have a$1600 house note. What this family should do is combine the house and car note into one $2600 motorhome note. Ditch the yard work, sell the kids, live in the parking lot at work or under the over pass in a big city, then on the weekends taking off a quick trip! Freedom at last.
Posted on 8/6/23 at 9:58 am to Reubaltaich
quote:
not realizing they took a 15-20% depreciation loss the moment they drove their shiny new vehicle off the dealer parking lot.
Bro if you buy toyota or Honda this just ain’t the case anymore. I believe it was true for your dads generation but not ours.
Posted on 8/6/23 at 10:07 am to Fat and Happy
I got the pricey fast car thing out of my system during my 20s. After four years I realized it was just another car. Now, while I'd have no problem with $1000+ car notes I simply don't care what I drive beyond practical reasons. Wasting money on a depreciating asset has become anathema.
Posted on 8/6/23 at 10:25 am to kciDAtaE
quote:
Can’t argue with anything you wrote. And using your math, that is $160k per household before taxes for a $1k note. That is not very difficult to achieve.
I don't know the actual numbers but a person could get them a late model Toyota Camry for about $20K. Put a $4-5K down payment on it and have about a $400/month note for the next 3-4 years.
But that is just common sense.
Too many want that brand new shiny Yukon, Grand Wagoneer, Escalade, Super Duty, Genesis ... loaded with every feature in the world even though they can't afford it.
As our Grandma's used to tell us, always live within your means.
Posted on 8/6/23 at 10:41 am to rintintin
I have to admit I'm confused as to why the car market is not at a near standstill. When you combine crazy high prices for new and used vehicles with the current interest rates.....you would think nobody is buying. You would be wrong. Folks must be raking up stupid levels of debt in todays consumer society.
Posted on 8/6/23 at 10:44 am to sosaysmorvant
I think it is coming. Car lots are completely full at most dealerships in Houston.
That being said I know a car salesman who set a record at his dealership last month for cars sold. Chevy/GMC dealership so he isn't selling anything cheap.
That being said I know a car salesman who set a record at his dealership last month for cars sold. Chevy/GMC dealership so he isn't selling anything cheap.
This post was edited on 8/6/23 at 12:34 pm
Posted on 8/6/23 at 10:46 am to Jake88
quote:
Now, while I'd have no problem with $1000+ car notes I simply don't care what I drive beyond practical reasons.
Same. The older I've gotten the less I care about my vehicles other than that they are fairly reliable. Mine is paid off and I hope to drive it another 6-7 years.
Posted on 8/6/23 at 10:53 am to fallguy_1978
quote:When you're taking Winn Dixie bags out of a car that you once did 161mph in, it dawns on you that its just a car.
Same. The older I've gotten the less I care about my vehicles other than that they are fairly reliable. Mine is paid off and I hope to drive it another 6-7 years
And now even cars like the Kia Optima have more features than a Lexus from 2006.
Posted on 8/6/23 at 10:58 am to rintintin
There’s nothing I love more than bass fishing. I’m always amazed at tournaments the amount of money going down the boat ramp. Hell, my partner has easily $150K worth of truck and boat. I’m not sure how any of those guys do it.
I’ll keep driving my ‘02 Dodge and putting around in my little jon boat and hope reasonable options are coming some time soon.
I’ll keep driving my ‘02 Dodge and putting around in my little jon boat and hope reasonable options are coming some time soon.
Posted on 8/6/23 at 11:05 am to ob1pimpbobi
quote:
pay $1100 a month th on a 36 month loan for 0% interest.
It's no big deal. I can easily afford it. Good credit and money make life easier.
Downvote away, but a no interest loan for 3 years is better than paying in full. I put that cash elsewhere. And also, most of you have notes that are not as good of a deal. Don't care.
Then you're not the people I'm talking about. The point of the thread isn't that NOBODY can afford a $1k car note. It's that the stats say a significant amount of people can't afford it, yet are paying for it.
Posted on 8/6/23 at 11:24 am to DiabeticRob
Terrible logic, financially speaking. What is your income? What % of your income is your car note? What are your financial life goals?
Posted on 8/6/23 at 12:21 pm to notiger1997
quote:
And yeah, there are indeed a very small percentage of people who are very stupid with how much their car notes are vs income.
Define small percentage. I think that number is well over 50% of car owners
Posted on 8/6/23 at 12:23 pm to OceanMan
quote:
Define small percentage. I think that number is well over 50% of car owners
Agreed. I think it's a lot of people. OP was just related to payments > 1k. How many others have an $800 vehicle note that they struggle with?
Posted on 8/6/23 at 12:26 pm to Reubaltaich
quote:
not realizing they took a 15-20% depreciation loss the moment they drove their shiny new vehicle off the dealer parking lot.
That’s old ways of thinking. It has def not been the case for quite a while, especially not with trucks in the past 10 years
Nothing wrong with buying new if you can afford it, especially if you keep them a long time
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