More than 80% of Americans can't afford a new car

[cptbarkey]

So by your measurements the US has really good interstates and highways, and 85+mph is fast?
Yes, comparing to Sierra Leone, the US has really good highways. Comparing to EU etc. no it doesn’t. In Germany they love to drive MUCH faster than 85+ but they have far stricter regulations and requirements.
The rear view cameras are not indicative of skill. The rear view cameras and sensors are there bcs. attempt to lower accidental deaths in driveways. But reason why in Germany is safer to drive 150mph than here 70mph is that a. Rules of the road are strictly enforced. B. Technical inspections are strictly enforced, meaning when one doesn’t change brake fluid 2 years he/she is out and argument “I drove My Chevy 15yrs without changing fluid,” doesn’t work. Etc, etc, etc.
And, besides that, many countries, what we would call third world countries, have similar emissions and other standards, mostly based on EU Norms.

Pick apart my comment all you like, but it still stands.

 

[Allaneddie]

Since the average age of vehicles on the road is over 12 years, a new vehicle should only be bought by 17% of the population in any given year. I actually think number is a very high estimate given how many are bought for fleet use.

 

[CKN]

Indebted people, as long as they're paying their bills, usually have very high credit scores. Because Sue and I are older and retired, both of us fortunate to have well paying careers, we own everything and haven't had any debt in well over a decade. The irony is that our credit score is at its lowest point ever. I've been told this is the way the system works - having no debt is a credit score liability.

Weird,

Scott

Some people can handle debt from a psychological standpoint-others can't. We never buy and borrow money for anything we couldn't pay cash for-including vehicles.

Yea-I know about investing verses borrowing etc., so no need to go there.

 

[JustN89]

Indebted people, as long as they're paying their bills, usually have very high credit scores. Because Sue and I are older and retired, both of us fortunate to have well paying careers, we own everything and haven't had any debt in well over a decade. The irony is that our credit score is at its lowest point ever. I've been told this is the way the system works - having no debt is a credit score liability.

Weird,

Scott

Credit score is only one piece to the credit puzzle. I could have an 850 credit score, but if I’m trying to roll over $10k of negative equity from a car that I bought during Covid into a $30k car and my interest rate is going to be 2-3 times higher, no bank is going to buy that. Maybe some lenders would’ve before and during Covid, but with delinquencies where they’re at, the appetite for risk has all but vanished.

 

[Allaneddie]

Indebted people, as long as they're paying their bills, usually have very high credit scores. Because Sue and I are older and retired, both of us fortunate to have well paying careers, we own everything and haven't had any debt in well over a decade. The irony is that our credit score is at its lowest point ever. I've been told this is the way the system works - having no debt is a credit score liability.

Weird,

Scott

Being in the no debt situation like that as well is the reason we pay most things (groceries, etc) on a credit card (one that gives us 3% cash back) to keep our credit score up. (It gets paid off every month). Not that we am thinking of taking any loans out for anything.

 

[edyvw]

Pick apart my comment all you like, but it still stands.

Everyone has opinion.

 

[slo town]

Yea-I know about investing verses borrowing etc., so no need to go there.

@CKN, I just have to go there. My father was a commission only salesman in the new home construction business. As a young teen I remember him showing me a $17 paycheck. I'll never forget that.

That had an effect on me. Sue and I have chosen the debt free route and given cheap money and a currency that is devalued with every opportunity, being debt free was that worst thing we could have done. Had we mortgaged the house and taken out loans for everything else - and invested our cash in the stock market - I'd be driving that GT3 Porsche I always wanted - and living in a 6 bedroom, 10 bathroom home with a 12 car garage.

The moral of the story? Choosing a debt free path was just about the worst decision we've ever made in our 47 year marriage. I think we agree, I'm just sayin'.

Scott

 

[JeffKeryk]

@CKN, I just have to go there. My father was a commission only salesman in the new home construction business. As a young teen I remember him showing me a $17 paycheck. I'll never forget that.

That had an effect on me. Sue and I have chosen the debt free route and given cheap money and a currency that is devalued with every opportunity, being debt free was that worst thing we could have done. Had we mortgaged the house and taken out loans for everything else - and invested our cash in the stock market - I'd be driving that GT3 Porsche I always wanted - and living in a 6 bedroom, 10 bathroom home with a 12 car garage.

The moral of the story? Choosing a debt free path was just about the worst decision we've ever made in our 47 year marriage. I think we agree, I'm just sayin'.

Scott

Spot on.
Credit is using other people's money to gain an asset. You are buying money over time.
Credit is a tool; use it wisely.

Scott, go buy that gorgeous Porsche! But I think you need a $200K Taycan; just sayin'...

 

[JoelB]

Indebted people, as long as they're paying their bills, usually have very high credit scores. Because Sue and I are older and retired, both of us fortunate to have well paying careers, we own everything and haven't had any debt in well over a decade. The irony is that our credit score is at its lowest point ever. I've been told this is the way the system works - having no debt is a credit score liability.

Weird,

Scott

To me this is the sign of a corrupt system where you are essentially penalized for having a generally more stable condition of low to zero debt.

 

[slo town]

Spot on.
Credit is using other people's money to gain an asset. You are buying money over time.
Credit is a tool; use it wisely.

Scott, go buy that gorgeous Porsche! But I think you need a $200K Taycan; just sayin'...

Yeah, that and a V12 Aston Martin Vantage, which Sue has long claimed best fits my persona.

Scott

 

[cptbarkey]

Everyone has opinion.

Europe and the US is also a small blip of how people move on a daily basis.

 

[edyvw]

Europe and the US is also a small blip of how people move on a daily basis.

Small blip: 771 million vehicles.
Big blip (rest of the world): 703 million.

 

[jeepman3071]

So by your measurements the US has really good interstates and highways, and 85+mph is fast?
Yes, comparing to Sierra Leone, the US has really good highways. Comparing to EU etc. no it doesn’t. In Germany they love to drive MUCH faster than 85+ but they have far stricter regulations and requirements.
The rear view cameras are not indicative of skill. The rear view cameras and sensors are there bcs. attempt to lower accidental deaths in driveways. But reason why in Germany is safer to drive 150mph than here 70mph is that a. Rules of the road are strictly enforced. B. Technical inspections are strictly enforced, meaning when one doesn’t change brake fluid 2 years he/she is out and argument “I drove My Chevy 15yrs without changing fluid,” doesn’t work. Etc, etc, etc.
And, besides that, many countries, what we would call third world countries, have similar emissions and other standards, mostly based on EU Norms.

Germany also has much better driver training. I dated a girl for a while who moved to the US from Germany. She was amazed how easy it was to get a drivers' license here.

 

[edyvw]

Germany also has much better driver training. I dated a girl for a while who moved to the US from Germany. She was amazed how easy it was to get a drivers' license here.

Well, yeah, but that is generally across Europe.
When I was obtaining US DL in 2005, there was a sign: no road test during rain. Because, you know, people don't drive in rain.

 

[cptbarkey]

Small blip: 771 million vehicles.
Big blip (rest of the world): 703 million.

Everyone in the world has a car? That must be nice.

 

[edyvw]

Everyone in the world has a car? That must be nice.

We are discussing cars, not public transportation.

 

[emmett442]

Spot on.
Credit is using other people's money to gain an asset. You are buying money over time.
Credit is a tool; use it wisely.

Scott, go buy that gorgeous Porsche! But I think you need a $200K Taycan; just sayin'...

Key word.

Mortgaging a house works because it allows you to live in your asset, which in this case is also an investment in that historically, it's value increases over time. You have something to sell when you are done with it, and the money you tied up in it likely kept up with alternative investments. For most, the alternatives to mortgaging a home are to be homeless or pay someone directly to use the asset that THEY own, leaving yourself with nothing.

Using credit on an expensive car doesn't accomplish nearly the same thing as a home mortgage: There are alternatives to expensive cars and credit that both free up your money for other opportunities and provide transportation.

A home is a MUCH more valuable asset than an expensive car in many ways, and using credit on a home makes much more sense than using it on an expensive car.

Anyway, I took the debt free route. I was debt free by the time I was 36. While some would say that was foolish because I was unable to invest the money I spent, I disagree. I am now cash flush to make some riskier and much more lucrative investment choices that I otherwise wouldn't have made given the obligations I had to meet. These choices have gotten me much further ahead than if I had gone the more traditional route of leveraging credit. I'm also constantly primed for the next investment opportunity that comes my way with my funds not tied up elsewhere.

An opportunity cost not many consider. Zero debt gives you much more risk tolerance, much more freedom. Having no financial obligations changes the way you see your finances and grow your money. This debt free vs. credit discussion usually assumes that both sides of the table have otherwise made identical investment choices, albeit at different points on the timeline. That's not necessarily true.

 

[CKN]

To me this is the sign of a corrupt system where you are essentially penalized for having a generally more stable condition of low to zero debt.

May or may not be corrupt. What I can tell you is it's a game ( credit, fico, etc) and you need to play and play smart. You Make a big Capitol expense ( car, house, etc) and if you didn't play ( no credit, low fico, etc) you are at a big disadvantage. I know thus goes contrary to " that guy on the radio" but he deals in absolutes- doesn't work in today's world!

 

[cptbarkey]

We are discussing cars, not public transportation.

Here is the subject.

"More than 80% of Amercans can't afford a new car"

what do you ultimately think might happen as a result of folks not being able to afford cars? Have you driven a moped before? They are fun.

 

[JavierH19]

Yep-in Mexico you can still buy NEW penalty boxes without airbags.....

Since 2020 dual front airbags are mandatory and rear side airbags are optional in Mexico. Since 1999 dual front airbags are mandatory and rear side airbags are still optional to this day in the US so both countries are on par in terms of airbag requirements.