• Sign in to follow this  
    Followers 0

    More Consumers Find Themselves 'Upside Down' On Trade-Ins


    • A number of factors play into this

    A record number of consumers are finding themselves 'underwater' when it comes time to trade-in their vehicle - the vehicle is worth less than what they owe on their loan.

    The Detroit Free Press cites a study done by Edmunds revealing that in the second quarter of this year, 32 percent or nearly one-third of vehicles being traded in fall into the 'underwater' category. This isn't good news for consumers since the difference is tacked on to the new vehicle they had their eye on.

     To put this in perspective, the previous high was 29.2% in 2006, around the time where the housing market was reaching its cresting point.

    “There’s been a lot of water building behind this dam for some time because of higher transaction prices, lower down payments and long-term loans," said Greg McBride, chief analyst with Bankrate.com.

    "It’s problematic for the consumer because there’s no foolproof way to eliminate his financial exposure. If the car gets stolen, is totaled or you get new car envy while you’re upside down then it’s a big problem."

    • In October, the average transaction price of a new car was $34,663 according to Kelly Blue Book.
    • The average length of a new car loan hovers around 68 months according to Experian Automotive. This rises to 72 months if it's a subprime buyer - someone whose credit score is below the low 600s.

    Not helping matters is the amount of vehicles being returned from leases, flooding the used car marketplace. This increase is causing dealers not willing to spend a lot of money at auction.

    Source: Detroit Free Press

    0


    Sign in to follow this  
    Followers 0


    User Feedback




    This is terrible news.. People just suck at being greedy. You allow people with poor credit to buy cars and they take advantage of that by continuing to trade in and get in more debt for a longer period of time..

    1

    Share this comment


    Link to comment
    Share on other sites

    Not surprised by this at all, it really is to be expected when creative financing allows people of little income to buy at a level that requires double if not triple what they really can afford.

    The dealers and auto companies need to stop offering creative financing to people that do not have the credit or income to support driving an auto that is outside their means.

    3

    Share this comment


    Link to comment
    Share on other sites

    I don't know why people keep trading cars and getting further and further upside down. Once of my car buying experiences I was sitting next to someone trying to roll 15 grand of negative equity into the next vehicle...

    I drive them until they drop.  Usually when I get rid of a vehicle, the battery and floor mats are the only valuable parts left....

    1

    Share this comment


    Link to comment
    Share on other sites

    While I agree with what Mr. DFELT and  CCAP, I personally will ALWAYS put the onus on the BUYER...


    WHY?

     

    Because he/she shoudnt be buying or leasing, especially leasing, new cars regularly if he/she cannot afford them. Leasing is good for some people, for most though, it shoudnt even be a thought let alone an action.

    If people PREFER to bite off more than they could chew, let them choke...

    Sure, banks and finance people and dealerships want to make money and morally they shoudnt take advantage of these people, but...this still falls under the responsibility of a consumer being responsible of his/her own finances...

    Personally, I have some cash saved up in my bank account(s)...I CANNOT wait when interest rates sky rocket again so I could start making money off my hard work and smart consumer choices with my savings...

    And no....while I do have some investments going on, I refuse to do heavy "investments" as greed fuels the dudes controlling the investment industry and I dont want any shyster telling me: "yo dude, the market had a hiccup today and poof, your money is gone..."

    I remember the crazy '80s all too well...and sure enough, history repeated itself 20 short years later...

    If somebody wants to keep up with the Jones-es and they end up hurting...not my problem.....and why do I feel like that?

    Because while its great to have low interest rates when I buy big ticket items for myself...at this point in my life, it would be better if high interest rates would be available to me for the money I have earned and saved, high interest rates dont exist because it protects those fools that part with their money easily...

    business-commerce-salesmen-investor-inve

     

    @A Horse With No Name I dont know why the need to change a good working car so often...

    Then again I do...

    Image and status and shyte...

    Vanity is a sin....but then again, who listens to HIM anyway?

     

    Edited by oldshurst442
    0

    Share this comment


    Link to comment
    Share on other sites
    20 minutes ago, oldshurst442 said:

    Because while its great to have low interest rates when I buy big ticket items for myself...at this point in my life, it would be better if high interest rates would be available to me for the money I have earned and saved, high interest rates dont exist because it protects those fools that part with their money easily...

    business-commerce-salesmen-investor-inve


    @A Horse With No Name

    “The problem with fiat money is that it rewards the minority that can handle money, but fools the generation that has worked and saved money.”

    - Adam Smith

    0

    Share this comment


    Link to comment
    Share on other sites

    I find this incredibly hard to believe. That number is shocking, and having been in the business for several years and worked for a variety of MFR's in different areas, I struggle to accept this as fact.

     

     

    Based on what I see, I'd have guessed it much, much higher. At least 50% being conservative.

    0

    Share this comment


    Link to comment
    Share on other sites
    13 minutes ago, Frisky Dingo said:

    I find this incredibly hard to believe. That number is shocking, and having been in the business for several years and worked for a variety of MFR's in different areas, I struggle to accept this as fact.

     

     

    Based on what I see, I'd have guessed it much, much higher. At least 50% being conservative.

    Why do people trade cars when they cannot afford to?

    Hell, my 2003 MINI Cooper S is doing fine, been paid for forever...would love to sit down with you and pump a few beers down, just to understand the auto industry better.

    ...and as a car guy there are so many other things I would love to spend money on other than cars.  I really really want a nicer band saw for my work shop. I cannot imagine putting every penny into a vehicle.

    1

    Share this comment


    Link to comment
    Share on other sites
    1 minute ago, A Horse With No Name said:

    Why do people trade cars when they cannot afford to?

    Hell, my 2003 MINI Cooper S is doing fine, been paid for forever...would love to sit down with you and pump a few beers down, just to understand the auto industry better.

     

     

    To answer your question, a number of reasons. Chief among them are just poor financial decisions. Some are nothing more than knee jerk impulse buys. Some are the result of being ignorant and getting taken advantage of. Some are due to reasons beyond their control- vehicle needs changed, can't afford the car because of other expenses or lost job, etc, etc. Sometimes it's a result of people trying to be frugal and practical, only to realize they are unhappy with their purchase and turn around to trade right back out of it.

    The problem is that with rebates and the way dealers can structure deals, it's very easy for it to seem as if you have little to no negative equity at all. Here's an example-

    -You owe 20K on your trade. 

    -It's worth only 17K. You have 3 grand negative equity.

    -You're looking at a car that has $2,000 of mark up.

    -It also has $2,000 Bonus Cash/Trade Assistance/whatever the dealer doesn't have to give you, or doesn't have to disclose what it is.

    -The dealer discounts the car you are buying by $1,000.

    -They use the other grand of mark up to over allow on your trade. 

    -And then use the $2,000 and add that to your trade allowance.

     

    The deal now looks like-

    List Price- $32,000

    Selling Price- 31,000

    Trade Allowance- 20,000

    Difference- 11,000

    Payoff- 20,000

    Total Financed- $31,000


    In such a scenario, it can be almost impossible to figure out that you had negative equity. The discount and incentives covered it up. But had you NOT been upside down, the purchase price of the new car would have been 3 grand cheaper. It's all in how you present numbers.

     

     

     

     

     

     

    As for your second part, I'd enjoy that. Then again, I'm not sure how much you'd learn, as I sometime struggle to figure it out myself, lol. For better or worse. What I see and think can (and seems to be, usually) very different from what CEO's, focus groups, and bean counters see and think.

     

    0

    Share this comment


    Link to comment
    Share on other sites
    1 minute ago, Frisky Dingo said:

     

     

    To answer your question, a number of reasons. Chief among them are just poor financial decisions. Some are nothing more than knee jerk impulse buys. Some are the result of being ignorant and getting taken advantage of. Some are due to reasons beyond their control- vehicle needs changed, can't afford the car because of other expenses or lost job, etc, etc. Sometimes it's a result of people trying to be frugal and practical, only to realize they are unhappy with their purchase and turn around to trade right back out of it.

    The problem is that with rebates and the way dealers can structure deals, it's very easy for it to seem as if you have little to no negative equity at all. Here's an example-

    -You owe 20K on your trade. 

    -It's worth only 17K. You have 3 grand negative equity.

    -You're looking at a car that has $2,000 of mark up.

    -It also has $2,000 Bonus Cash/Trade Assistance/whatever the dealer doesn't have to give you, or doesn't have to disclose what it is.

    -The dealer discounts the car you are buying by $1,000.

    -They use the other grand of mark up to over allow on your trade. 

    -And then use the $2,000 and add that to your trade allowance.

     

    The deal now looks like-

    List Price- $32,000

    Selling Price- 31,000

    Trade Allowance- 20,000

    Difference- 11,000

    Payoff- 20,000

    Total Financed- $31,000


    In such a scenario, it can be almost impossible to figure out that you had negative equity. The discount and incentives covered it up. But had you NOT been upside down, the purchase price of the new car would have been 3 grand cheaper. It's all in how you present numbers.

     

     

     

     

     

     

    As for your second part, I'd enjoy that. Then again, I'm not sure how much you'd learn, as I sometime struggle to figure it out myself, lol. For better or worse. What I see and think can (and seems to be, usually) very different from what CEO's, focus groups, and bean counters see and think.

     

    You are also open to alternate viewpoints, which I genuinely appreciate.

    CEO's get really caught in group think, focus groups can go way off track also.

    0

    Share this comment


    Link to comment
    Share on other sites

    All good points by everyone.  I would say there are 2 huge problems.  First people want to buy cars with no money down when they shouldn't buy a car unless they can put like 10% down on it, if sales tax alone is 7% like in my county, you need 10% down to cover taxes, fees, registration, etc, and hopefully like $500 toward the price of the car.   At least then you aren't upside down on day one.

    2nd problem is the 72 month car loan.  That amortizes so slowly, the car is depreciating faster than you can pay down the loan.  If you can't afford the payment of a 48 or 60 month loan, then you probably need to shop for a less expensive car.

    A $30,000 car on a 72 month loan is about the same payment at as 60 month loan of $25,000.  If you shop based on 10% down and a 60 month or shorter loan, you probably won't end upside down on the car.

    2

    Share this comment


    Link to comment
    Share on other sites
    6 minutes ago, smk4565 said:

    All good points by everyone.  I would say there are 2 huge problems.  First people want to buy cars with no money down when they shouldn't buy a car unless they can put like 10% down on it, if sales tax alone is 7% like in my county, you need 10% down to cover taxes, fees, registration, etc, and hopefully like $500 toward the price of the car.   At least then you aren't upside down on day one.

    2nd problem is the 72 month car loan.  That amortizes so slowly, the car is depreciating faster than you can pay down the loan.  If you can't afford the payment of a 48 or 60 month loan, then you probably need to shop for a less expensive car.

    A $30,000 car on a 72 month loan is about the same payment at as 60 month loan of $25,000.  If you shop based on 10% down and a 60 month or shorter loan, you probably won't end upside down on the car.

    Agree completely.  There is also the living beneath your means. My sons girlfriends parents live in a house that is pretty spectacular, they have worked hard their whole lives and are very careful with their money. 

    They got a fantastic deal on the house and have had a lot of equity from day one.

    They drive a four year old Avalon when they could write a check for an S class and not have it hurt them. Another friend of mine is very well off, house is paid for, very secure job in academia, does a ton of very highly profitable consulting work...and drives a Nissan Rouge.

    He also could write a check for an S class or a CT6.

    A lot of millionaires drive older domestic 4 door cars like Buick and Chrysler 300, et al. 

    Personally, i would rather have a hundred grand in the bank and drive a 25K car than have 25K in the bank and drive a 100K car.

     

    1

    Share this comment


    Link to comment
    Share on other sites

    Agree with that, but even for people buying a $15,000 car, they can easily end upside down if they get an interest rate that isn't favorable or put no money down.

    0

    Share this comment


    Link to comment
    Share on other sites
    Just now, smk4565 said:

    Agree with that, but even for people buying a $15,000 car, they can easily end upside down if they get an interest rate that isn't favorable or put no money down.

    Ohh absolutely....and given the crappy residual values of a lot of modern cars, there will be plenty of pain to go around.

    0

    Share this comment


    Link to comment
    Share on other sites
    1 hour ago, Frisky Dingo said:

    I find this incredibly hard to believe. That number is shocking, and having been in the business for several years and worked for a variety of MFR's in different areas, I struggle to accept this as fact.

     

     

    Based on what I see, I'd have guessed it much, much higher. At least 50% being conservative.

    Oh sht, & thought you were going to say the number was higher than expected. 

     

    Personally, I only know one person who rolled negative equity to a new vehicle "but" it was downsizing to a focus from a Ram because he was driving a sht ton and 15mpg wasn't cutting it.. he rolled like 8k into the focus loan. Hard to believe it was still a good idea but he's kept the focus for 4 years now and I talked to him the other day about this actually and he'd still be upside down if he tried to trade it in now be he has no intentions of doing anything until it's paid off. 

    1 hour ago, Frisky Dingo said:

    Some are nothing more than knee jerk impulse buys. 

    This has never made sense to me. I understand it's a thing but how in the hell do people make tens of thousands of dollars an impulse buy?!?!

    0

    Share this comment


    Link to comment
    Share on other sites
    2 minutes ago, ccap41 said:

    Oh sht, & thought you were going to say the number was higher than expected. 

     

    Personally, I only know one person who rolled negative equity to a new vehicle "but" it was downsizing to a focus from a Ram because he was driving a sht ton and 15mpg wasn't cutting it.. he rolled like 8k into the focus loan. Hard to believe it was still a good idea but he's kept the focus for 4 years now and I talked to him the other day about this actually and he'd still be upside down if he tried to trade it in now be he has no intentions of doing anything until it's paid off. 

    At some point maybe I could see doing this...but it is a long five years paying something like that off.

    0

    Share this comment


    Link to comment
    Share on other sites

    Yup, and all those modern cars entering the used market, yes, used market will have a boon.

     

    Aside from that, the hard times are approaching for the auto makes. Once this last bastion of boomers hit the hay, there's not gonna be many millennials buying cars. And if they are, well, I imagine they'll be underwater from day one. And stay that way unless they are within their means. Many are underwater when it comes to their cell phone. A car in the cards? NOPE.

    0

    Share this comment


    Link to comment
    Share on other sites
    1 hour ago, Suaviloquent said:

    Yup, and all those modern cars entering the used market, yes, used market will have a boon.

     

    Aside from that, the hard times are approaching for the auto makes. Once this last bastion of boomers hit the hay, there's not gonna be many millennials buying cars. And if they are, well, I imagine they'll be underwater from day one. And stay that way unless they are within their means. Many are underwater when it comes to their cell phone. A car in the cards? NOPE.

    Hard times indeed....

    0

    Share this comment


    Link to comment
    Share on other sites

    Interesting this comes up after a good buddy of mine just traded in both his cars and got two new ones...

    One car owed 12/got 4100 and Second 20k/18k. Somehow, he ended with with some rebates that in all only cost him about 20 bucks more a month. Also kinda a shame because both cars where about 2 years to pay off...

    He is lucky that he can afford them as his he and his wife have pretty good jobs....but it is going to make it harder for them to get a house in the future with that debt....

     

    It's why at this stage of my life-while I love cars, I also would love to keep some money in the bank! It's why I'm fixing up the two I have now, and we are looking at just one new car,for the family to share. Even then it's a good chance it will be a base model.....screw the bells and junk with it.... And when her car goes, a 3-5 year old used car will be the replacement-at a cost of less than 40 percent new......

    It's also why leasing is going to get more and more popular-cheap-and you just get a new one when you are done.....

    0

    Share this comment


    Link to comment
    Share on other sites

    lots of righteousness going on here,

    in my 1.5 yr brush with selling cars, i came to realize just how strapped most of the public is most of the time for paying for their transportation.  In my experience, very little was it ever people spending frivolously.  They really were most of the time trying to figure out how to get something to get them to work, for the least amount of money they could piece together.  

    A large percentage of people flat out can't get approved for credit.  Being in a high risk pool, that increases their interest cost at the same forces them to go down on the ladder on a vehicle that an auto retailer is still trying to sell for a decent margin over what they paid on trade and for recon for, and after they pay for all the buildings, ads, and front desk receptionists with their boobs hanging out all over.

    Isn't it just flat stupid that people might buy a 9 1/2 year old car on a five year loan and drive it off the lot and be instantly thousands upside down?  Well shit, i bought a house with 20% down back in 2003/4 and after all this freaking time my property is probably still worth 25% less than i paid for it.  Why do i mention this?  Because the economy has been shit for several years now, and like with housing, the money faucet was in fair correlation with salaries and the health of the jobs market.

    We're in this odd conundrum where people's incomes are down or stagnant for a long time (it never was a recovery).  Auto sales have boomed new the last few years simply because the pent up demand after the market dived after the crash.  Now that we're probably seeing saturation of that pent up demand, it's a bit of a bubble.  And now lease returns are starting to hit the market again.  Transaction prices are through the roof, and that's due in part to the devices needed financing wise to keep the factories running at the higher levels.  They probably need to self induce a cutback now and curb credit some.  Add to this the last oh how many years of strangulation with regards to emissions and fuel economy / cafe mandates....all the prices for this technology has pushed vehicle prices up as well.  

    When you start looking at a new vehicle at 30,000 bucks, the sales tax alone in some states can be like 2 grand.  License fees can be 500 bucks a year.  But it goes even further than that.  No one has 5 grand to put down.  And even if they did, it literally is throwing money out the window, because that money, all it does is pay for the tax and a depreciation hit and dealers profit for driving it off the lot.  When something has a depreciation curve like that, i absolutely would not want to pump a lot of cash into at the start......put in enough to try to stay close to above water if you can.  It's great advice to say 'don't buy a car on more than a 48 month loan' or something like that, but even on a 7 year old used car with 100,000 miles that might sell for 15,000-20,000...people won't even be able to come up with a sizable down payment.

    The fact that gas is so cheap the last couple years has done a great job hiding the affordability problem with driving a car.  If people can't afford a 400 dollar a month payment for 5 years on say a 3 or 4 year old car (which is a lot of people) i can't imagine what happens when gas goes up to 5 bucks.

    What is the answer?  Well, crossovers by nature are more expensive and maybe cars can only become more affordable if people revert back to sedans more.  the source of the problem really is people's wages and the prices are crazy stupid.  We may just end up seeing market adjustments to new or used cars to account for this.

    I resigned myself to the fact that i can own a car free and clear and when its 7 years old its worth shit.  I can trade it in and any equity i finally earned by that point might pay for sales tax and plates on a new one the next time around.  I can try to think i am a martyr but thinking, hey i'll save up a nice chunk of change and get a good used car, but none of that chunk of change gets you any equity either.  You literally if you want to be atop your car probably have to put half down and I honestly would estimate that those i worked with that got more than say 4,000 bucks down on any transaction was maybe 10% of buyers.  Probably more like 5% (but what i sold was prob 90% used).  

    it's just reality, people piece together what they can for wheels to get to work.  I'm not going to go deep and criticize how they solve that complex financial issue.  And the manufacturers and dealers you can blame if you want but they have factories to keep open and expenses to pay and you get where you have to sell and get what you can to keep the lights on.  If that means fire saling your inventory there comes a point where you may need to do that.

    I decided the last two times to lease.  I never thought i would have 2 vehicles on lease at the same time.  My realization was that buying used was even going to be an eye popping amount of money for a wise purchase so in these 2 cases I decided to kick the can down the road (and also to avoid giving my beloved state as little tax dollars as i could for awhile).  When the van lease is up, i will either negotiate a cheap buyout (much cheaper hopefully than the equivalent on the used lot at the same time) or find a good deal on a 2 year old low mile unit and get back on the payment wagon.  When the Malibu lease is up, I may just find a cheaper older rig if again i can't steal my own turn in and bet the farm i wont have to spend a bunch of money each year on repairs.  

    Think about this.  Let's say you started today to save for a new vehicle to buy in 3 years.  Let's say you wanted to buy a new Impala and it could cost you 30,000 dollars today.  The car you drive now is 7 years old and paid for.  You're lucky today if a dealer will give you 5 grand on what you own now.  In three years they will offer you 1,000 bucks for that.  that should pay for your tabs in 3 years on the new one.  The 30,000 dollar today impala will be 36,000 dollars in 3 years.  If you want to pay cash for that you will need to save 1,000 bucks a months for those 36 months.  Buy used you say, well, in 3 years a 5 year old Impala might be 21,600 dollars.  So to buy that car in three years that will already by 5 years old when you buy it, you'd have to sack away 600 a month (in addition to the money you'd spend on repair and maintenance to the car you already drive).

    I certainly could accuse anyone of spending money foolishly or excessively on cars, including myself, but the hard message so many buyers learn is, new or used, whether you own your vehicle outright, or are making payments, or paying for repairs etc, nobody drives for free.  There is always a cost to what you drive.  And i give credit to as many people that can that just can figure out how to pay for the miles they drive.  It's a very select few individuals who are either car savvy or can do their own repairs or are just flat out lucky that they maybe bought a 9 year old junker with some saved up cash from someone off Cragislist, and managed to keep it on the road 6 more years without paying for a transmission or an A/C compression, or brakes, tires and shocks all around.

    I honestly think its time to curb some of the technological development in automobiles for awhile and concentrate on how to get more affordable products out there.  And maybe at same point people's real spending power becomes healthy.  In the meantime, the bulk of the population I am certain merely does what they have to just to have something to drive to their job, if they have one.

    0

    Share this comment


    Link to comment
    Share on other sites

    It is simple as we have been on this trend for a good while. 

    Cars used to be a small part of your income and buying a new one was something a kid in High School could do on their own at one time. I could remember the neighbors, my parents and my buddys dad buying new cars every year. They would sell the used one for nearly what they paid or only come out a little less. When a new car was only $4000 or less it was easy to do. 

    Today a car is at least a years pay of more for most people in the middle class. 

    Then you have the poor decision factor as many people today handle money poorly. So many fail to have much in savings. Some it may be bad luck like health issues but most just spend it all and never stop till it is gone. We all have done it but maybe not to the same extreme. New I phone every year. Projection screen TV's and housed so large many can not afford to fill all the rooms with furniture. 

    Today to make cars work well for most budgets you need to keep the car for about 8-10 years and just pay it off. Cars today easily last 12 years before rust of electronic failures are in play. You can go well over 100K miles with no sweat anymore with out any major failures or repairs.  Yet we have people often trading 2-3 years and getting over their heads. 

    I have several friends who have nearly gone bankrupt with good jobs just because they trade so often. One I kid because I told him he should get dealer plates as he had gone to the point he has traded up to 3 new cars in a year recently. 

    Actually it was about 3 years ago he bought a Truck new, He found he did not want to pay the gas since he drives on a sales route. He went to a Cruze and his wife refused to ride in it because it was too small. Then he got a new Impala. That went away for a Honda with no explanation. That then vanished and not he has a Toyota truck. Oh Right before the Truck at the start was a Juke that he kept 3 months. 

    Now he has not made a dime and took a bath on all these vehicles. He is not dumb and has a good job but he is to the point he had to sell his Corvette because he was so far under. Also while this went on they bought the wife a Ford SUV that vanished in months for a new Toyota SUV. 

    Now I would like to say this is an isolated thing But I see similar things happen with others. They may not be to this extreme but enough to put them under. I have a guy at work who buys a car fixes it all up then trades it. So he takes a bath on the vehicle and all the parts. Recently it was a jeep with new wheels, a lift, fenders and other add ons. Now he is leasing a truck and bought a hard bed cover for it and he will not have this in 2 years as he never keeps anything that long. 

    Some folks get bored with a vehicle and trade after only 2 years is what normally happens. 

    But accidents and then a panic trade, Quality issues and then a trade to get rid of it. Buying too expensive then having to trade down because they can't afford etc. 

    To be honest I would make a horrible salesman because I would try to talk people out of making mistakes that are plain as day. 

    Cars are where poor decision are made daily that stick out. At work I see people daily spending money on cards they can not pay off. They will limit 3 cards to get what they want and have 3 screaming kid in the background. Note these are not things to fix anything these are play things they could easily live with out. Some times I will google where they live and it is sad. 

    God knows there is a lot of things I would love to do and I at times may spend a little more than I should but the wife and I try to live with in our means and be happy with what we have. We keep our vehicles about 10 years - 100K miles and i keep them in top shape. We also buy the models that tend to be popular or hard to find and we often get good resale. Hell I have had people come from Florida to buy one of my cars in Ohio because it was in the best shape they could find one in. I have been lucky. 

    As cars get more expensive people are just not going to be able to afford and that is why so many companies are buying into ride sharing companies. The addition of many of the new technologies coming are going to be obscene high and this will be the only way some will be able to afford them as pay will not increase along with the prices. 

    Electric self driving cars are just not going to get much cheaper if anything they will continue to increase in price. 

    Today the price of a new car stands at $35K when I bought my first new car back in 1985 the average price was what I paid $12,500. What is the next 30 years going to bring?

    The first thing we do need to teach is how to handle money to the young. Two teach them do not look to the government to pay for it all. If you want to get ahead in life you need to do it yourself not with hand outs. But as we progress I see people becoming more dependent as time goes on. 

    0

    Share this comment


    Link to comment
    Share on other sites

    FYI just find out what people owe on Credit cards and you will see how poorly many manage money. Much of this is due tot he instant gratifications of buying things. When I point the finger the thumb is pointing back at me too as I have it like most others.


    we all spoke at work once about how much people owed and it was amazing many could sleep as bankruptcy was not a possibility it was a future reality.

    Edited by hyperv6
    0

    Share this comment


    Link to comment
    Share on other sites

    Our Encore was holding its value quite well when we first bought it out of lease.  We went into that transaction buying a car for $2k less than its apparent trade in value.   We *should* have bought it and then immediately traded it in, but we kept it.  Since then, the value of it has decreased to the point where we were owing as much as it was worth.  I didn't like that, so I started increasing our car payment.  The payment according to the loan is $348 a month, but I'm sending them $600 a month instead to keep well ahead of the depreciation. 

    2

    Share this comment


    Link to comment
    Share on other sites

    I love that I have no auto payment. Yes I do love my rides, but 2008 is my newest, 1994 is my oldest, will probably die before I get rid  of my 94 GMC Suburban SLE. That is a tank that just keeps going. :D

    0

    Share this comment


    Link to comment
    Share on other sites

    When i got the Bug and Camry we HAD to have them.  The Silverado in particular needed a ton of work and with both of our drives being roughly 100 miles a day we were going through roughly a grand in fuel every month.  I made my mistakes and my credit has suffered so my financing rate sucks, but this is helping me rebuild it as well as the fact we will be keeping these or a very long time.  Bought used too which does help. 

    0

    Share this comment


    Link to comment
    Share on other sites



    Your content will need to be approved by a moderator

    Guest
    You are commenting as a guest. If you have an account, please sign in.
    Add a comment...

    ×   You have pasted content with formatting.   Remove formatting

      Only 75 emoticons maximum are allowed.

    ×   Your link has been automatically embedded.   Display as a link instead

    ×   Your previous content has been restored.   Clear editor