12% are paying $1,000+ a month for car loans ...

skyactiv asked:

What would you drive if you had no mortgage, no debt, no kids and your wife and you made $324K last year?

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What you see below.

We like to have 2 vehicles. We probably don't actually need 2 vehicles but we like to have two of them. I buy a new one every 10 - 20 years and push one off the end.

I have kids and grand-kids. And they really like my Tesla.
 
zzyzzx said:
That might be the only thing available now. With the shortages of parts, automakers are mostly making the more expensive models.

In before the lock.
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I agree and that's a good point. Folks want what they can get and if it's the macked-out trim, they buy it.
 
macarose said:
Definitely my type of guy Brian. If people like your Dad ran this country we would have a balanced budget and no worries about excessive government spending. Just stability, a strong middle class, and pensions.
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We keep reelecting the politicians in office than bankrupted us.
 
I am looking out my back window at the two neighbors houses and on the right the guy has 10 acres , Horses, a huge area a couple cows and goats and owns a twin engine pressureized cabin plane owns his own company. Some people have a good cash flow and the guy is close to being scary smart.
 
When I was shopping 6 months ago, the new car smell was not in the budget. In fact, my $444 payment is being felt, so how in the world does someone do twice that?

Even though I really wanted to buy a new Jeep Wrangler, it just didn’t make sense. So, I bought a sensible commuter and will patiently wait for the crash so I can sell the commuter and buy a nice Jeep from someone in over their heads.
 
svtrit said:
When I was shopping 6 months ago, the new car smell was not in the budget. In fact, my $444 payment is being felt, so how in the world does someone do twice that?

Even though I really wanted to buy a new Jeep Wrangler, it just didn’t make sense. So, I bought a sensible commuter and will patiently wait for the crash so I can sell the commuter and buy a nice Jeep from someone in over their heads.
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They pay twice that b/c they have to take a Zanax every day when they think about their debt to income ratio ahahahaha. I get some folks income makes it a non-issue to afford a $1K payment.
 
$1k a month is a lot for a vehicle IMO, however I’m not sure if the 12% number is a concern. Seems logical that 12% of the population could afford such a payment since about 15% of households have an income between $100-$150k.

Seems about right IMO. It may not be smart financially long term, but it’s not like banks are giving out $1k monthly car loans to people making $40k a year.
 
macarose said:
Nice RV, but that one got some pretty strong negative reviews due to quality issues.

Great video of it though!

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I've heard the same thing. Unfortunately applies to most RV's now. I really like the preview of the Nexus Verrado. But I'll probably never own one till they hit the used market around 50-60k, if I'm going to pay that much for a new RV and still have problems might as well keep my old sorted RV!
 
skyactiv said:
What would you drive if you had no mortgage, no debt, no kids and your wife and you made $324K last year?
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Definitely different vehicles, and I'd probably have more of them being a car enthusiast. With that said, very few people make that much money or are in a similar situation, yet many people still have massive car payments.

I was at a dealership yesterday with my father since he is currently vehicle shopping, and the sales woman was talking about how even with a good job she can't afford a lot of the vehicles she sells. Many people are rolling over what they owe on their trade-in into the payments of the new vehicle, often because they owe money on a vehicle that has a large repair bill and no longer makes sense to fix.

I'm fortunate to have never had a car payment, but I think for many people they just buy things based on if they can afford it on a monthly basis.
 
Lots of "I've never had a car payment" folks here - it's really not a big deal if it's as I put in my post somewhere above....20% down, no more than 5 years, get it paid off if possible, don't over extend. Reasonableness w/r to buying new/used cars and borrowing money w/r to your income isn't what the issue here is.
 
300.00 a month is more then I want to spend on a single car payment. I wouldn't even want to spend 500.00 between 2 car payments
 
Vil_Riker said:
Is it per individual or per family?

A $72,000 truck at 6% interest and 9% sales tax will be $1,145 per month over a 7 year period. Given how high the car and truck prices are, the monthly payment amount is not surprising.
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It is because I would never spend anywhere near that for a vehicle.... yikes
 
TiGeo said:
Lots of "I've never had a car payment" folks here - it's really not a big deal if it's as I put in my post somewhere above....20% down, no more than 5 years, get it paid off if possible, don't over extend. Reasonableness w/r to buying new/used cars and borrowing money w/r to your income isn't what the issue here is.
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For sure, the issue is most people measure their ability to afford something by just making the monthly payment, and paying way more for the vehicle in interest with 84 month loans. If I could do 0% on a new vehicle I would so I could invest the money elsewhere, but good luck finding that these days haha.
 
jeepman3071 said:
For sure, the issue is most people measure their ability to afford something by just making the monthly payment, and paying way more for the vehicle in interest with 84 month loans. If I could do 0% on a new vehicle I would so I could invest the money elsewhere, but good luck finding that these days haha.
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I've never done the 0 stuff, b/c in the end they usually won't give you the lowest OTD price so much better off doing a loan from my credit union and taking the cheapest price for the car in the end.
 
jeepman3071 said:
For sure, the issue is most people measure their ability to afford something by just making the monthly payment, and paying way more for the vehicle in interest with 84 month loans. If I could do 0% on a new vehicle I would so I could invest the money elsewhere, but good luck finding that these days haha.
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But looking at what you can afford w/r to a payment per month is part of it. The part that is left out is the total cost over the life/OTD total price and the depreciation/staying ahead of it. I always figured that at any time I could sell my vehicle and walk away with some cash in hand and that was my contingency if I got in a pinch. I did just that when I was younger and we had our first child; I had a '00 Jeep Cherokee I bought brand new. I made about $40K/year and my wife about $30K so $70K total household income. It was $20K, I put down 20% so borrowed $16K for 5 years and the rate was about 7% back then in 2000 so payment was about $350 if I recall, easily within our budget. Our mortgage was about $1000. When the baby was born, it was decided that she would stay at home so I lost significant income and that $350 was important. I easily sold the Jeep and walked away with enough cash to buy an older Honda Civic commuter car. It's all about planning and understanding how it all works...which clearly a large chunk of American's don't.
 
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