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More Than 80 Percent Of Americans Can’t Afford New Cars (jalopnik.com)

submitted 2 years ago by [email protected] to c/[email protected]

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[–] [email protected] 9 points 2 years ago (2 children)

The example the article gives is pretty extreme to me:

[Greg] McBride, the Bankrate analyst, walked MarketWatch through a hypothetical car-buying scenario for an average-priced new car that cost $48,000. Taking into account the trade-in value of your existing vehicle, let’s say you knock some money off the sticker price and finance a $40,000 purchase price at 7.5% for five years. That’s an $801 monthly payment — which means you would need to make $96,100 a year if you wanted that payment to be 10% of your income.

I don't think I'd ever want to spend half a yearly income on any single purchase. An investment in a house being the only exception.

[–] [email protected] 4 points 2 years ago (2 children)

It's completely wild to me that the default for buying a car comes up to a monthly payment, why not pay cash? Save those 800 for three months, buy a beater for 2400. While driving this into the ground, continue saving the 800, even if that beater craps out after six months, you can upgrade to a 4800 not-so-crappy beater, rinse and repeat, and at some point you saved up the 48000 to get that new car. Financing something that depreciates in value quickly and exponentially at anything above the inflation rate is, financially speaking, complete and utter nonsense to me.

[–] [email protected] 5 points 2 years ago

There are many factors at play. Surely, a huge one is status. It's why one of the most desireable keywords to associate with vehicles (as picked by buyers) is "luxurious."

But then there is everything else. My state requires annual inspections. And you must fully repair that vehicle, including to modern emission specs, before it is legal and able to be registered. That alone will cost more than a beater in many cases since they are, well, a beater. A vehicle so old it is essentially driven until it is in a state of disrepair. As someone else said, saving money becomes difficult with a beater eventually because the cost of repairing it to keep it legal eventually outpaces your savings if you aren't operating on a short timeline.

Personally, I make good money and still drive my old vehicle because it is good enough. I have peers who do the same: our priorities are elsewhere, like paying for private school tuition for the kids or whatever. But I also know howmit ends eventually: accidents, causes by other people, which totals your vehicle because it's value is so low or damage so significant. And there isn't a lot of beaters on the market here anymore. So people are forced to buy new or take a slight discount for used (insomuch as monthly payments go). Used prices are just that crazy.

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[–] [email protected] 8 points 2 years ago* (last edited 2 years ago) (1 children)

They're also pretty much exclusively sell SUVs or heavier cars, these are intentionally pricier

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[–] [email protected] 8 points 2 years ago (1 children)

Out of curiosity I went looking to see what the 2023 price is for my car and I'm really scared of how I'd afford a new one. After having two used cars turn into death traps I'm not interested in used cars. Even used cars are expensive now too.

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[–] [email protected] 7 points 2 years ago (1 children)

Across the pond in the UK they're expanding ULEZ and this is a major sticking point. You need to upgrade to more fuel efficient cars, right when buying shopping is expensive enough. They want you to get new cars, and the majority cannot aford them.

[–] [email protected] 4 points 2 years ago

Buying shopping? What does that mean?

[–] [email protected] 7 points 2 years ago (2 children)

Great news!

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[–] [email protected] 4 points 2 years ago (1 children)

I'm European and I'm disabled so I don't earn a lot. I plan on swapping my 30 years old Opel Corsa with a Yaris sometime in the far future. It'll be the last car I buy. Oh, I hate SUVs.

[–] [email protected] 9 points 2 years ago

I hate the trend of everyone driving SUVs. I drive a small sedan and I hate not being able to see around me because everyone is driving big SUVs or trucks.

Plus, I get blinded with their lights because their headlights are shining on my rearview mirror.

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