A few days ago Jennifer from Live Richly commented on a post I had written entitled 8 Big Reasons Why You’re Getting an F in Personal Finance 101. She was lamenting the sense of entitlement she saw in many people. Here is an excerpt:
“I know a woman who is a single mother and hit up her friends for money to replace the engine in her SUV. I declined to participate because even though I have a lot more money than her, I have a 9-year-old car that’s worth maybe $2000, and hers is worth about $30K. Her engine costs more than my whole car… I will admit that peer pressure is real though. I’ve had many people mock my car, and if I cared, I would run out and get a fancier one.”
Ah, Jennifer. Let them mock you all they want because those people clearly have a misguided view of how the world really works.
Yes, it’s true a large segment of society still believes that the car a person drives is a status symbol that accurately reflects the level of financial success he or she has achieved.
The truth is smart people know nothing could be further from the, er, truth. (Dang, I hate when I do that.)
As far as smart people are concerned – and even dummies like me – the sticker price of somebody’s car can never be considered a reliable indicator of their financial success.
If you don’t believe me, just look around; the proof is everywhere.
For example, here in Southern California I see teenagers driving BMWs, and Lexuseseses (or is it Lexi?) all the time. I don’t think most of them hit it big blogging, or own wildly successful businesses at that tender age.
I also see people working in jobs that pay $30,000 per year driving Infinities. Is that supposed to be impressive?
More like stupid.
Heck, Jennifer’s friend owns a relatively-modest priced SUV and she couldn’t even afford to get the engine fixed.
So clearly, one cannot determine the size of a person’s bank account merely by the type of car they drive.
I know a couple that used to live in my little neighborhood community who drove brand new his and hers BMWs. Guess what? The bank foreclosed on their house a while back and they had to move away. Although I do not know the exact circumstances that led to the foreclosure, perhaps if they drove more modest cars that didn’t require monstrous monthly payments – or better yet, no payments at all – they might still be living in their home today.
Although we can truly afford to drive almost any car we desired, The Honeybee and I choose to drive a 2001 Honda Odyssey and 1997 Honda Civic, respectively. Our cars are not glamorous, obviously, but they are well-maintained and, best of all, they are paid for.
Although she didn’t say so, I bet Jennifer’s car is paid off. I’ll also wager the vast majority of newer luxury cars on the road aren’t.
And while those luxury car owners will continue to be saddled with some hefty car payments over the next several years for the privilege of traveling to their jobs in style, the rest of us will continue driving our Honda Civics, Toyota Corrolas, and Ford Focuseses-es (or is it Foci?) and use the money we save for our relentless drive toward financial freedom.
And guess what? Most of us won’t give a damn what the others think either.
If I had to give any advice to Jennifer on this subject, I would tell her that she should never fear peer pressure for owning a “beater” for a car.
Financially savvy people actually consider it a badge of honor.
Loading ...
via Email 
My husband once looked around our modest neighborhood and asked, “How these guys affording these cars?” I pointed out that most of them probably had 6 or 7 year loans for their cars, and were living paycheck to paycheck. The same is true for almost any fancy purchase. Big TVs can be financed, as can almost anything that you buy that tries to say, “Look at me; I’m awesome and living large.”
Just love this subject. More people get in financial difficulty here than any other place.
I have never bought a new car
I only pay cash for a car
I bought my first car for $50 and started working on it MYSELF. Learn to do most work.
I believe that the BEST car is a company car. You know the company provides it.
I keep most cars for short periods and let others take the big depreciation hit
I now drive an 07 cadilac, my most ever luxury car $16,000 and will sell it the end of this year
I am 74. My wiife and I enjoy life vacationing with my large family. I can afford it.
I get mocked all the time for being a young girl, driving a 11 year old minivan.
Seriously, I couldn’t care less.
I just smile and if I really get pushed, I say: I bought it in cash and it works beautifully.
(And it does!)
I won’t lose any sleep over people thinking I’m cheap.
You are not cheap. You are frugal. LOL Like me.
There aren’t a lot of things people can do to save money that REALLY save a lot of money. Turning out lights when you leave the room, eating out a little less, etc, are good, but they don’t add up all that fast.
Choosing a cheap car ranks right up there as the biggest.
Mine: 1999 Saturn SL2, 150K miles, no car payments for last 7 years.
@Miranda – too funny. My wife and I used to laugh at the fancy luxury cars at our APARTMENTS too, hah.
@gn – Excellent point! Once I started driving paid for cars I could save and invest w/out breaking a sweat. So fun! It’s too bad most people will go on thinking that a car payment is a fact of life (I know I used to believe that).
I knew I’d turned the financial-success corner and headed the right way when I started looking at BMWs and thinking, “man, glad I didn’t pay for that!” Awesome post!
Thanks Len for the shout out! I agree with you that an expensive car does not equal a fat wallet. I see college age folks driving new sports cars all the time. While it may be their parents bought it for them, that says a lot about the smarts of their parents!
My 2001 Mazda Protege is paid off, since my husband and I paid cash for it at the dealer (it was used then). Well, we sort of paid cash. They wouldn’t accept actual cash and it was too late to get a bank wire on a Saturday, so they insisted we take it home without paying a dime! We did wire the money on Monday of course
I’ve never owned a new car and the peer-pressure is very real, especially because I’m in management. I work at a medical device company and the lot is full of BMWs, Mercedes and Lexuses. I drive a 1996 Chevy Cavalier that I bought off the receptionist, when she upgraded to an SUV.
I just can’t see dumping a huge amount of money into tranportation. Cars cost too much and depreciate too quickly. Although, I may break down and buy my first new car, when electric cars are finally available. I would love to drive something with lower maintenance and fuel costs.
What is impressive is when you can afford to buy your BMW cash
I love nice cars but they are clearly a huge source of expense. I just bought a RX-8 but instead of paying a brand new one at 30-35K, I bought a 2004 for 12K… I then have the pleasure to drive a nice car without having huge car payments attached to it
When buying a car, you also have to consider if you make enough money to pay for its maintenance. Tires, oil changes, gas, insurance, etc. they add up in no times!
Funny how one of the worst investments possible is one of the most popular! The other day I saw a nurse in my neighborhood get into here new corvette and shook my head as a rode my bike past.
Too bad there aren’t more smart people out there cause I see a ton of high end cars where I live.
I find all of you to be extremely rude and perhaps jealous is the better word just because some of us drive nice expensive luxury cars . Your answer to living on the edge of poverty is to ridicule others by insinuating that those of us fortunate enough to earn high 6 digit incomes because in most cases we finished college or maybe took over successful family business. Did you ever stop to think that not everyone lives beyond their means ? Do you really feel that by stating ” Too bad there aren’t more smart people out there ” forgives you for earning less or spending less than you really wish you could ? I have friends who change their new cars ( yes cars – not car ) every three months because to them spending $ 25000 is like you spending $ 250 . Now, before you begin blogging that their money would be better off spent curing the ill or perhaps giving to charities , please be advised they already do that .
lol. You’re funny.
The article doesn’t state that every single person driving an expensive vehicle is living beyond their means. It states that many of them are, and that is absolutely true. People spend money they don’t need to spend simply because they want the world to know how important they are in their fancy car. I drive a small economical car though I could definitely afford a nicer one. I chose my car because it gets me where I’m going dependably and allows me to keep a lot of money where it belongs…. in my pocket. I guess if you don’t like it when people express their opinions of conspicuous consumption, I don’t know what to tell you. I guess you can believe that I’m jealous of you. The truth is, I grin when I think about how much money you spent that I didn’t.
“Mr. America”,
because you are so offended by the article, it is obvious you are not truly wealthy, and are probably struggling with your finances and being able to afford your fancy car. You are so quick to call it “jealousy”, which is what all the pompous wanna-be rich people say. Like the 20-something-year-old, who *leased* his first BMW and is still taking money from mom and dad to help him out.
Truly wealthy people know the difference, and understand what it takes to make money and hold on to it. No truly “rich” person would be offended by this article. You mention your wealthy friends who buy new cars every three months – there is a reason they aren’t posting here, and you are. I bet you are trying everything you can to “keep up” with your rich friends. trying to show them that you can appear to be wealthy too, and be in their elite circle. Yet I have a feeling you are like the little dog that follows them around all the time, wishing he was one of them. so sad. I think it is you who is jealous of someone who is happy with what they have, and is financially free.
Miz got it in one. Mr. America is a wannabe richie who *imagines* himself rich and, as such, is offended by this article. If he had a 6 figure income, he wouldn’t give a damn. It’s that simple.
Sorry we called your bluff, Mr. America.
Mr. America, i want their slightly used cars..
Nice try. Nobody with the smarts to earn a high 6 figure income would get a new car every 3 months, too much hassle.
Precisely, Rob.
I think you missed the entire point Mr. America. I believe the author of the article is stating that if people were happy with what they owned, they would not worry about what the Jones’ drove.
I make high 6 figures after graduating from university. I work long hours and through long weekends. By 25, I’ve owned numerous cars that people would call high-end. But just two weeks ago, I’ve sold my beloved German performance luxury vehicle and now I rely on my beater 9 yr old motorcycle. Cars are a financial black hole all together and as a status symbol? HA. Only for those who need to stand a little closer to the urinal than others.
when i was 24, i bought a 100k car. the car stayed in the garage most of the time and while it was awesome to drive, it wasn’t worth the $50k i spent in 2 years before i finally sold it. i also went on ridiculous vacations, staying at 5 star hotels, buying one way tickets to random places around the world just because i could afford it and came back when i was ready to go back to work.
i did stupid stuff like this for 4 years while earning an avg of 450k/year (i got lucky – tech). i totally regret doing it because i literally have saved only 300k. i should have had 1 MILLION in the bank by now and bought a condo in cash (well, that would be stupid at today’s rates, but you get it). it’s not every day you land in a company that goes public. i squandered that money like it was nothing. i had fun, but those memories have faded. i spent 200k/year just to have ‘memories’; when i die it won’t mean anything.
in retrospect, i would gladly be driving around in a beater and a more modest lifestyle for just a few more years. and when i stop working 20 years before everyone else, they won’t be talking about the beater i drove!!
i respect those of you who make < 100k and can manage to save 20k a year.
I don’t know many adults who didn’t wish could reallocate some of the money they spent as teenagers and/or twentysomethings. I blew upwards of $25,000 on stuff related to a rock band I was in when I was younger. I often wonder if I should have just invested that money instead. It’s all part of growing up and learning via the school of hard knocks!
Luxury car owners are saying to the rest of the world:
I need a lot of attention for total strangers
I want to appear to have more money than you
I don’t have to answer to any one else for anything I do
I don’t care about filling the air with pollution
I don’t care about the rest of the world
if my car is too big for the parking spot, that’s just too bad for everyone else.
You are not envied, I could buy one too, but as a responsible and mature adult, I don’t want one. I don’t need the attention, or envy of others to make my day.
You’d be surprised how much “just a nurse” makes. I have been out of university for just 3 years and could easily afford a corvette and the associated costs no problem, be careful about the assumptions you make about people. On another note, I see the point of your post, and agree with you — too many people who own expensive vehicles can’t afford them.
Nurse, Assumption are people’s realities and assumptions predicated by experiences. One another note besides the current subject of the author’s article, as you might know, we live in a volatile economical times. With every bill you have including that really spiffy car, take all of your bills and multiply by 6 months. If you lost your job today, which possession would go first?
Maybe cos her husband’s ritch? ;D
I hear you. Just after college I paid $400 for a 1991 Geo Prizm with 97k miles. While it is definitely one of the most humble cars I’ve ever seen, it is also mechanically sound and (with proper care) should last many years to come. In the meantime my wife and I have been able to achieve most of our financial goals (working on Baby Step 6 now, paying off the house), and I am putting $200 a month aside as a car replacement fund. Any guess on what I’ll be able to pay CASH for when my little Geo dies?
Yeah, I live in an apartment complex: Nicer than some but not luxury living by any stretch of the imagination.
And yet…
There are an awful lot of nice cars. Granted, I consider a nice car to be anything above $30,000-$35,000. I don’t know how people measure cars in the real world. I just know that I’m perfectly happy if our next car is a Hyundai or something similar.
This whole car:living quarters ratio kind of blows my mind. Until I remember that there’s probably a reason these people are renting, and it’s sitting in their parking space.
@Miranda: Great point about other large purchases. You know, I look around my neighborhood and think the same thing sometimes. Especially when the homes have not one, but TWO fancy cars.
Ha! What are YOU doing driving a minivan? (Just kidding.) Seriously, minivans are very practical. We love ours. It can be used to haul large items or lots of people in real comfort. It ain’t sexy, true. But it’s a great way to travel – especially over long distances! 
I value a car by its ability to get me from point A to point B safely, reliably, comfortably and efficiently. Fortunately, there are lots of cars on the market (both used and new) that can meet those requirements for a relatively small amount of money.
@FB: Hi, Me!
@gn: You are right. It is a real luxury not having to make a car payment every month for five hundred dollars or more. That is a VERY significant amount of money that can be used to quickly build emergency or your retirement savings accounts.
@Deacon: LOL I assumed I was the only one who thought that way when I see those luxury cars.
@Jennifer: Thanks for sharing your story – for once I didn’t have to think too hard for an idea! LOL That car dealer took a bit of a risk, yes? If you had crashed the car over the weekend before you actually wired the money wouldn’t they have been on the hook to pay?
@Bret: There are a lot of high-end cars where I work too. The upside for me is when we have to travel locally, most of the time nobody wants to ride with me in my Civic so I get to ride with the engineers who bought the luxury vehicles!
@Mike: I know you didn’t ask me, but right now I spend between $1500 and $2000 per year on maintenance – that ensures my car continues to run like new. Yes, being able to pay cash for a BMW is impressive! On another note, my next car will probably be almost new. Maybe a year or two old, tops. That should result in some significant savings since, as Bret alluded to, cars depreciate a good chunk of their initial value when they are driven off the lot.
@Ryan: My old boss owns a Corvette and that thing seemed to always be in the shop. They are expensive to maintain – even for mundane things like tires.
@Mark: It all depends on how much cash you have! If your Prizm goes another 7 or 10 years, you should be able to buy something very very nice!
@Abigail: It’s all about priorities, I guess. There are folks out there who consider their car more important than their living arrangements – or being able to build a bigger nest egg, for example! To me, a car is near the bottom of my “priorities totem pole.”
@Len: Absolutely the dealer took a big risk! The funny thing is they INSISTED we take it home. They figured the bigger risk was me changing my mind and not returning. I might have been a deadbeat and never paid, and then they would have had to repo it. This was back in 2005 when US lenders threw money around like candy.
Glad I can help you out with an idea. You let me know when you need another
Um, Jennifer… I think I need another idea. :-}
Hmm, renting vs. buying a house? How to know when it’s time to leave a job?
i live in LA also and it is hard not to see some of the most expensive cars in the world here.
it is one of those things where you hope you don’t fall into the my car is nicer than yours trap.
@Jennifer: LOL! Don’t give up all your good ideas!
@James: Unfortunately that’s how a lot of people think out here, James – even if they can’t afford to try and impress the impressionable.
I like to relate peer pressure, or keeping up with the fictional “Joneses” as being part of the lemmings. Why jump off that cliff with your lemming friends when you know better. Now if only I could get my husband on board with the whole “you don’t need a luxury vehicle” point of view!
I am happily driving my 2007 Toyota Corolla CE, 5 speed manual transmission, around! It is paid for! It is reliable! It gets great gas mileage! If the battery dies or the alternator goes out, I simply start it rolling, jump in the car, put it in second gear and pop the clutch!
It is very low maintenance. It even has a timing CHAIN, not a BELT.
I love my car. At my income level (well over $100K), I could be driving a BMW or Lexus….especially since I am on Baby Step 6 and have been debt free, except the house, for quite some time.
Love my Toyota…it probably won’t die on me for at least 10 more years….maybe 15. Heck, at 40K miles, I just got the engine broken in….
Love this post. I drive a 1998 Jeep Cherokee that’s been paid off for years and laugh at all the people driving BMWs, Lexus, or whatever, knowing probably 2/3 can’t REALLY afford them.
Plus, I see them so often, it makes them less appealing…why pay $40k for a car a bunch of people drive when you could spend $20k for an Accord or Camry (which are basically the same cars anyway)?
@Spedie: My Civic hasn’t crossed 120k miles, even though it is on its 14th year – but that is going to change since my commute doubled about six months ago. Still, I don’t see why I can’t squeeze another 130k miles out of it assuming I keep it well maintained (or maybe even longer).
@Kevin: I’m with you, brother!
I am in Cairo and a lot of people here dress in Western style, a lot of people wear arab style gowns and some just mix it up. The thing about the gowns is that they are comfy, protect from the sun and are cheap as hell…. A pair of Levi’s costs the same (or maybe slightly more) than a pair of Levi’s in USA, that is a LOT of cash in Egyptian pounds but people still save the money to buy them so they can look impressive. I know it’s extreme but I have almost considered wearing traditional Arab wear out of protest against the consumerism that takes over everything!
Completely agree with the sentiments of this post. Since most cars are financed anyway, when I see a new car, I often think to myself “Yuck, I wonder what the payments are like on that thing!”
@len Just included this post in my weekly round up
I appreciarte the shout out, Shawn!
It’s a bizarre sort of world we live in if people consider it better to impress strangers with an expensive car than to suck money off their friends just to keep it on the road.
Sometimes I think I’m from an alien planet.
We all love to look at that beautiful Ferrari or BMW that zips down the freeway at breakneck speeds. It is usually an indication of wealth but people who spend 6 figures on a vehicle probably aren’t especially wise with their money.
Thanks for the post. It has been nominated as the top five posts of the week on my website! Congratulations!
The obsession people have with cars in the US is interesting to say the least.
I’m not saying I wouldn’t ever drive a luxury car, but it’s simply not going to happen until it can be paid for in cash.
I currently drive a 1996 Ford Explorer with 196,000 miles and I’m hoping it’ll last me through the next 4 years of school. The engine was replaced at 176,000 and it’s been running great since then.
What I don’t get is that people will pay so much more for basically the exact same vehicle. Yes, I think you are much more successful because you drive a Lincoln Navigator instead of a Ford Expedition.
I won’t lie though, sometimes I give in to consumerism and think about how sweet it would be to drive an Escalade or Telsa Roadster (payment free of course!)
@LittleHouse: Some folks simply value nice cars more than others. If your hubby values them more than say a very nice vacation every year, then you’re going to have a lot of work ahead of you!
@Monevator: That story really was amazing, wasn’t it? I would never have the stones to ever make a request like Jennifer’s friend did.
@Conrad: Thanks for the nomination! I’m glad you enjoyed the post, Conrad!
@Ryan: I’ve been a passenger in a lot of luxury cars, and they ARE really nice. But when I sit back and try to determine value for the money, I can never justify buying one. That’s just my opinion. And if some people think that makes me cheap, so be it.
I don’t particularly like cars, and certainly wouldn’t measure my ‘worth’ against my vehicle. I think mine is the ‘top beater’ of the page, a 1989 (yes, that’s twenty years old!) VW Golf, solid as rock and still running smooth at just over the 100k miles. It cost me a whopping £300. I like that it’s old – it’s purely mechanical, no computer bits and bobs, no irritating voices if you don’t belt up etc. But most problems I can fix myself… well, some problems, I’m no mechanic … but I can manage my own oil changes and filters etc. It’s well battered (let’s say the previous owner wasn’t too good at cornering!) so all my work colleagues are constantly nagging at when I’m going to buy something newer. Simple – I’m not! It’s not broken, nothing to fix. But I do enjoy the occasional dig when they have to ‘pop out’ to buy a £300 sensor, or spend £100 on an oil change, or need a lift home because their computer won’t let them drive. “So, when you going to get rid of this expensive white elephant and get a car that works, then?” I ask.. Ah, schadenfreude.
You definitely win the prize among the readers for oldest car, Macs. Congratulations! The joys of a purely mechanical car are many, to be sure. When I was a teenager a lot of girls I knew drove VW bugs and they were so simple to work on that they often took care of their own repairs too.
But, Macs, 100 pounds for an oil change? That’s like, what, $160 right now? Are oil changes really that expensive across the pond?
“But, Macs, 100 pounds for an oil change? That’s like, what, $160 right now? Are oil changes really that expensive across the pond?”
If they see you coming… lol
To be honest I don’t know the actual cost, as I never do it. But I’m sure £50 would be a lower limit, plus the hassle factor of being without your vehicle for the morning. Compared to maybe £5 for new oil, £10 for filters, and a few minutes of getting greasy by doing it yourself, I think the DIY has to win out.
BTW I’m going to trawl the rest of your blog soon, I just arrived on a link from Monevator. Cheers!
In my line of work, 90+% of the people I speak with each day are millionaires. They typically drive nice cars, but very few of them purchase new cars every 1-2 years (I don’t know any who lease). I see a lot of them driving nice cars (occasionally I’ll see someone roll up in a ’80s honda with the muffler hanging on with coat hanger, who is a multi-millionaire, but that is the exception), and they are almost always paid for (if not, they could all be paid off in a heartbeat). What many people don’t realize is that these people have not always lived the lifestyles they are currently living.
The millionaire next door was a great book, but what has made an even better impact on me to is to see the it in real life. I once helped someone send money to a dealership to pay for a new car. I knew that the dealer sold Audi’s, so I asked if he was getting a new Audi. His response was awesome ‘I wish I could afford an Audi!’. Many people who are actually driving these cars are limiting themselves from being able to keep up their same lifestyle down the road, and meanwhile the guy who could pay cash for 50+ Audi’s doesn’t feel like he can afford one.
@Macs: Welcome aboard! I’ll have to thank my friend the Investor (again) for sending you here. Monevator fans (of which I am one of the biggest!) tend to be among my “stickiest” readers, so I hope that trend continues with you, Macs!
@CH: Very interesting! Can I ask what line of work you are in, CH? If I was a multi-millionaire, I would probably would buy a luxury car. Great insight on the fact that many folk driving these cars today are going to be unable to maintain that lifestyle down the road. I’m curious if they will be able to handle driving a more modest car down the road after years of driving a luxury car…
@Len – can’t really say much more than I work with people and their money/investments, and all my clients are millionaires. Most of them do drive luxury cars, but we’re talking Lexus, BMW, Cadillac, etc., not Bentley, Rolls, etc.
@CH: I really don’t find it surprising that most of your millionaire clients drive the mid-level premiums like Beemers, as opposed to Bentley’s. If I was a millionaire, I’d “settle” for the BMW (or similar lower-priced luxury marque) too. As a millionaire, I would ask myself the same question I ask when I choose between a Civic and a BMW as a “thousandaire:” for the extra $50,000 or $100,000+ I’d pay for a Rolls or Maybach, what am I really getting? Whatever it is, from a utility perspective, I can’t believe it would be worth the price premium.
What counts as a millionaire, for you? Investable assets? Net worth (including home equity)?
What about if most of a person’s wealth is in non-accessible tax-advantaged retirement savings?
Just curious. I keep tabs on our personal balance sheet, but I’d have a hard time self-identifying as a millionaire if that million was composed of retirement savings and home equity.
Hard to say, L, but for me it’s not so cut and dried as my net worth. I definitely wouldn’t include the money in my 401(k). I’d base it more on annual income: Without thinking about this too deeply right now, I’s say I would consider myself a millionaire if I could pull in $500,000 per year.
@CH You just reminded me that there was a brand new Maserati GranTurismo parked close to my house today. I guess the people with the premium vehicles above Mercedes and BMW tend to have many other cars as well. I know of this Maserati owner and hear that he has at least 5 others. I’ve also read that the average Bentley owner has 6 or 7 other cars.
For clarification – I’m in the Midwest, so people are a bit different with how they spend than some other places. However, I never said that there is anything wrong with buying expensive cars, I think it all just comes down to what people want to spend their money on. What is worth noting though is something that has been mentioned in other comments, that there is a difference between luxury vehicles and ‘ultra-luxury’ vehicles. BMW, Benz, etc. are not even in the same league as Maserati, and really shouldn’t even be compared IMO.
Bentley says that the average owner of a Bentley has a net worth of $30M. Should the person worth $1.5M buy one? That’s their call. There is a big difference between the person who has worked hard for average pay and saved a million bucks and the person who earns that or more in a year.
I guess all I’m really trying to point out is that a million bucks isn’t as much money as it once was (still a lot of money…but less so), and that just because someone accumulates $1M+, they can’t automatically afford anything in the world.
Great article! I generally agree with your views on this. However, I look at things a little differently. I basically consider every car under $70,000 to be non-luxury. I don’t believe there is any such thing as a prestigious Infiniti. The fact is that when you see an Audi R8, Aston Martin or other vehicle like that, they usually say quite a bit about the owner’s net worth. This $70,000 line simplifies things for me. People with a weak net worth have trouble buying cars over $70,000. In fact, moving my line up to $100,000 might not be a bad idea either.
Hey, Jon, that is an interesting observation that makes a lot of sense. My ex-neighbors with the his and her BMWs probably would never have qualified for his and hers Maybachs – let alone even one. Maybe I need to create a new category of auto – like pseudo-luxury, sub-luxury, or poor-man’s luxury car.
Interesting to read the disdain of “luxury car drivers” from some of those who have commented here. I guess I could be mildly offended because I’m one of THOSE people. Being the previous owner of a BMW 525 and the current owner of a 2008 Audi A6 quattro. Yes..I’m a major car enthusiast and love to drive a well tuned automobile. It’s not necessarily a “symbol of my success”, I merely enjoy sweet cars..what can I say?? Trust me, I’ve driven my share of beaters! In college and after I drove a 1979 Toyota Celica..with ripped seats and a primered hood. I reached several milestones in my life before purchasing a “luxury car”. I bought my 2nd home, maintain a signifcant investment account.. married my beautiful wife (who drives a paid for ’00 Maxima..her choice) we travel when we want and live a comfortable life. I guess my point is..don’t judge. If your neighbor wants to buy a Benz or whatever, if he can afford it or not, if hr planned for it or not..it’s his life. You do with your life what you want to do. Like drive a Focus! I’m sure he’s not judging you for that.
Don’t be offended. I understand there are many people who CAN afford nice cars – and bully for them (and you)! But many people buy expensive luxury cars they can’t afford precisely because they WANT to be judged. That is, they want to try and impress others with their supposed “wealth.” This was simply meant to be a public service notice to those folks that buying a car to impress others is a fool’s game because smart people (and me) rarely equate the type of car one drives with their financial success anyway.
Yep I totally agree but let’s bare something in mind. Not all people who drive luxury cars are those who are so called pushing their $$$$ to buy one cos some really can afford easily. To be fair, we should not judge them just by what they are driving. Who knows what jobs they are holding? Btw I’m a car fanatic who admires hyper cars of all sorts.
However we should definitely know how far our budgets are and do more research on a car we’re eying on first. For your info I live somewhere in SEA where cars are highly sought after. But, the prices have been sky rocketing due to the blooming economy. Even a Toyota corolla cost like, near to 80k. The standard of living is sky high and like what is mentioned in the article, 40 % of the cars are BMWs, Mercs, Audis and getting popular…………Porsches. Yet the not so well to do community own cars like………..WTH????? A BMW X6 and a Lambo Countach to name a few…….. Btw a X6 here costs as much as a Lambo in America and not the M-Division version X6. Unbelievable right? o.O
Once again, the post isn’t pissing on luxury car owners as a whole. If you went back and actually read it instead of reacting on reflex, you’d understand that.
@LJ- You are the only one that has made sense thus far IMHO. Kelly…YOU should actually read the posts above to get his point!
Hey guys! I drive a new Toyota . Certainly it is not a luxury car. It is a reliable car. I hate it when people look at me. I don’t want any attentions from other people at all. I am going to tint the windows so they can’t see me. At the same time I hate to drive the car with tinted windows cuz it is hard to see at night and all seasons here are really dark except summer. You guys have any ideas why they like to look? Cuz they are jealous? Cuz I live in a bad neighborhood? I hope I have an old reliable car so they won’t pay attention to me. I am seriously hate it. If I like a luxury car I won’t drive a Toyota! Stop being a fool by judging what car they drive. Some rich people drive a 92 chevy that you will never know!
If you “don’t want any attentions from other people,” maybe you should just close your eyes! It’s a lot cheaper than getting the windows tinted.
They look at you because you are the reason why our country is in the shape it is today . You chose to give your American dollars to a country that operates in America almost tax free. You chose to give your hard earned dollars to the same country that may have killed your grandfather or grandmother or maybe even one of your closest friends relatives at Pearl Harbor . They even have a couple of words for others like you . One is stupid and the other is traitor .
Yeah , I know -your going to tell us the same stupid nonsense that when America builds a good car you wouldn’t be driving a Toyota . Isn’t that interesting because the last time I looked your dealer had a huge building behind the showroom called the SERVICE dept and its filled with broken Toyotas . Imagine that !
Yeah, I a think so.
Yeah, I think so.
I agree with Len… Why do people waste money on tinting their windows when you are just going to be forced to remove the tint when a cop pulls you over.
I can understand your point of view, however, while all the assumptions and judgement? Not everyone who drives a luxury car is living paycheck to paycheck. It’s almost as if you are insecure about your clunker, therefore it makes you and the other clunker drivers who commented feel better or smarter. People buy and pay for what they want. It’s not your place to judge. That’s what people work for. Some people actually like to pay for things that make them happy after they have worked hard to obtain them.
As for the person who said they laugh at people in apartments who drive luxury cars………not everyone wants to own a home. Home ownership is a lot of work. My aunt is single and makes over 100k a year. She owned a home when she was younger. She has great credit, is debt free, but she chooses to rent her home. She likes to drive decent cars as well. That is her right.
To the contrary, Mermaid. I am very proud of my 1997 Honda Civic! Stop on by and I’ll even give you a ride in it sometime. Don’t worry. I keep it very clean.
If you want to drive a $60,000 car and can comfortably afford the payments, bully for you.
This post is clearly directed at people who purchase fancy cars – even though they can’t reasonably afford to – because they are under the mistaken impression that they are impressing people. The truth is, there is nothing impressive about driving a fancy car if you are struggling to make ends meet.
@LenPenzo Haha yes I totally agree with you. ;D
Mr. America,
I don’t think anyone is finding fault with someone that has the resources to purchase whatever they please. I think that the point being made is that there are so many people that are not financially savy making poor consumer choices. I too could afford to purchase more expensive cars. I choose to put my money into non-depreciating assets. To each his own. Generally speaking, most people are clueless about how money works.
@Jeanette If this was FB I would like your comment!
Mermaids614, I completely understand your point. However, at the same time, there seem to be far too many people nowadays who don’t have much money yet buy mid range luxury like the E-Class and 5-Series.
Simply put, because of this, you now have to spend even more if you want to stand out. It makes having an amazing car even more expensive for those of us who *can* afford it. I’m becoming more and more unsatisfied with my sub-100k luxury car because all this overspending allows these people to get cars that are only ten or fifteen thousand dollars less than mine.
I figure you’ll soon need a 100k+ car in order to stand out. If people bought what they could afford, this wouldn’t be the case.
Great point, Jon.
I drive a 2001 Dodge Caravan and it so rocks my socks! It can get me from Memphis, TN to Chicago, IL on ONE tank of gas! Seriously! We went last year and got a little worried on the way and stopped at Edinburgh to gas up at half a tank. But on the way home, we filled up and made it to our driveway just as the gas light came on! How sweet is that?!
Oh and at over 133K miles, I see many more road trips ahead!
While I understand the fact that not everyone cares about what they drive and I agree that a car doesn’t always accurately represent what a person is worth, don’t look at me funny for driving a nice car. I was the kid that grew up poor and had the Ferrari posters on my bedroom wall. We had old hand-me-down cars. I always dreamed about owning cool cars. Now that I’m old enough and have a decent job, I spend more than is necessary on cars. I’m not trying to impress you. I don’t care what you think about what I drive. I buy and drive nice cars because I want to. It’s something I’m passionate about. Something that I have fun with. I buy cars that are a few years old, that have lost half there value but are still very fun to drive. I drive them for a year or so and then get a new one. I can sell them for a loss of a few thousand, which is basically just a car payment. It works for me…
So to all the financially smart people posting here that have-paid off 2002 Subaru’s, we’re not all trying to impress you and remember, you can’t take it with you!
I totally agree. I struggle with the balance between only what I need (minimum $$$) and what I would like/enjoy more (extra $$$). How much is the extra fun worth to me?
While some people will unfortunately take it to the extreme and negatively judge people because they have nice cars, I think the important criticism here is about the people who drive cars that they can’t safely afford. If you have sufficient funds, you’re certainly welcome to drive whatever you wish. But if you can’t afford it, you’re a fool if you overextend yourself just to impress people.
I was in that vehicle rat race, but for different reasons. I used to drive a F250 Super Duty Crew Cab diesel, but unless you saw it pulling the trailer we had for our store you would have thought it was overkill (then again, we live in Austin TX, so big trucks are normal around here). Our first mini-van was high-end fully loaded model I bought from a credit-union repossession auction. Paid $20k for a $36k 1-1/2yr old vehicle.
Got rid of my last truck (Dodge Ram, terrible gas mileage) in 2008 just as the lease was up and gas prices were killing us, and my neighbor had his daughter’s low-mileage car for sale,a little Hyundai Accent. Took a 3 yr note from the credit union and have 12 months to go. Simple cheap car to do maintenance on, timing belt is next and I do my own maintenance.
I do a lot of other stuff to reduce my expenses so I probably save a lot that way. Schedule all my errands at once in the most efficient route;try to time my gas usage to run by the cheapest gas station around just when I need to fill up, etc.
I also use synthetic oil for better engine management temperatures, lubrication, and cheaper cost in the long run. I used to average 15k miles/yr, but with planning and lower-income, I now do about 10k, including driving to work. I’ll be keeping that car for a long time as a commuter. The big problem we have in Austin is you’re only allowed to have 1 vehicle per driver in your driveway. Even older non-registered vehicles are not allowed and since everyone uses their garages as storage nowadays…..
I’ve still got the old ’67 Impala with a 4-brl Holley and 283 small block w/Powerglide tranny, simple to work on. And the ’91 Ford Crown Vic Police Interceptor (bought at auction), all mechanical
, so…..simple to work on and maintain, and ALL PAID OFF.
Bottom line, doing your own maintenance work will save you a ton of money and it’s not that expensive.
It’s a pretty reliable indicator that anything sold as “Luxury” can be translated to “Waste of Money”.
Just found your post–interesting stuff! I must confess I did buy a Lexus back in 2001…but I bought it used (2 years old) and am still driving it. It’s gonna be 12 years old soon and we just passed 120K miles. LOVE the car. Paid it off in three years and never looked back. I have no interest in anything new, so it was a pretty good investment for me. It didn’t cost me any more than a new Avalon at the time, I had the bucks, and it’s a great car. Plan on keeping it to 200K!
Good for you! I think that is the best way to buy a car, Southside. Especially when you consider most cars lose almost half their value as soon as you drive them off the lot.
When I first started working, the first car I bought was a very very old Datsun. It got me where I wanted to go, even though it was probably the most dangerous car I will ever drive,but I was happy. Then I was transferred to Germany where my second car was a very old Ford. Again,I drove all over Europe in that thing, until it died. All my colleagues told me to get a BMW,or a Porsche, since it was the level they were driving.I seriously thought about it, but in the end, wound up buying a brand new Datsun 350(this was 1982, the year before they started calling all their cars Nissan). I was single with no debt except for the car note. I got married in 1984,still had my Datsun. My son was born in 1988,still had it; my daughter in 1990. The car had been in Germany, California, Indiana, Illinois, and Texas. We were moving to UPPER STATE NEW YORK in December 1991, the car was still going strong, but with two babies, I just did not feel as if we should be taking any chances, so we finally bought a new mini-van. Had the van until it died in my kids’ high school parking lot in 2005. No pricey car then, none now. We replaced it with another mini-van.We’re in the market for a new car since my husband’s car, purchased in 1990,just died last month , and it won’t be a luxury car although we could afford one. I’m at a point where I absolutely feel no need to show wealth by driving an expensive auto.
Good for you! And best of all, just think about all the money you saved over the years, Brenda, by not having a monthly car payment or two every year! Thanks for sharing!
Brenda guess what.??
My dad bought a 1982 Datsun off the lot Cash for $3000 in 1983. He drove until 2 years ago when he gave it to me. He had 3 children with it and enjoyed it.
I now have it. This car has never failed on me, has never had a car issue because me and my father maintain it pretty well because I don’t know that much about cars yet, but I will.
I still have it today, gets about 25/mpg, and it’s been paid off for about 28 years now.
I have about $40,200 for a new car, but I guess I fell in love with my FIRST love, and so many people try to clown me, but when they realize I have so much money in my wallet and not in debt, I always leave with the last laugh.
I’m 21 years old by the way..
But Lenzo..obviously you’ve never driven a high end auto like a Bentley or similar vehicle. If so, you probably would not question the difference between them and some mid-range vehicles like BMW’s and the like.
I must say there is clearly a difference.
Obviously.
Len, I read about a rapper that just bought a new Veyron last week. It cost him $2 Million, plus $180K per year in maintenance. I’ll bet it’s fun to drive a 1,000 HP car. Of course, I rarely need to go 260 MPH.
“I rarely need to go 260 MPH.” Me too, Bret. Only when I make the trip from from LA to Vegas.
Mr fake America. Why dont you preach instead to the millions of fake patriots driving huge suvs and pickups wasting precious gasoline. Its these fake patriots who are keeping Mr Happy Arab, happy.
Many posters have mentioned they drove blah blah until it “died”. The vehicle “dies” only in an accident with damage impossible/uneconomical to repair. I’ll wager a Mercury dime nearly all of those that “died” did so from decreasing levels of maintenance,brought on by an unwillingness to pay for sometimes expensive repairs.If your 10 year old $2500 car needs repainted and you won’t spend 400 for an econo paint job, you don’t get to say the car “died” 5 years later when you can toss your Value Menu wrappers out the rust holes. Buy yourself a quality car, maintain it and keep it forever. I’m more impressed with your 25 year old/600,000 mile immaculate Rabbit diesel than your neighbors brand-new Jag.
Well said, but come on, Dave; after such a well-stated comment, I’m dying to know what you drive. Don’t leave me hanging!
I totally agree! Pretty much what my parents do. We have a 90 Accord (98k mi.), 95 Quest (160k mi.), a 01 civic (130k mi.) and a 10 civic (15k mi.). I think of my dad’s 90 Accord as his nice car. My mom’s Quest takes us to church and people like coming with us because it has 7 seats and runs super smoothly but yes it does have its repairs. But my dad says, why not just repair it instead of buying a new car at $400+/mo on average? My dad bought me a 10 Civic just because it’s such a great car 35 miles to the gallon hwy and only costs my dad about 250/mo with insurance at .9% interest and he doesn’t want me to worry about getting stuck on the road. When I see my uncle’s Nissan truck hitting 350,000 miles man that knocks my socks off it’s like damn your truck is a champ. I know our Nissan will hit 250,000 at least before maintenance will even start to become a little pricier. As long as you take care of your car it truly will last forever.
I keep seeing a rash of posts that are blowback against “excessive” lifestyle choices – and the forums are full of anger and bitterness aimed at those people, as well as a smug self-assurance that the people who make these choices are foolish and will ultimately pay the price for their poor financial choices.
You know what? A BMW is *much* nicer to drive than a Honda. It is.
But you know what else? A good late model BMW that is in good condition can cost less than a brand new Honda.
I’ve owned several BMWs now. A ’97 BMW 328i, a ’90 BMW 325i convertible. Currently I own a 2003 BMW X5, a ’97 BMW Z3 convertible and a 2006 Cadillac Escalade.
They’re all reliable, well maintained, and absolutely more of a joy to drive than your typical grocery getter.
And here is the hilarious part. Most of the people cruising around in a brand new, $26,000 Ford Focus, Honda Accord or Toyota Camry don’t know the difference between a 2006 Escalade and a 2007 Escalade. Only other Cadillac Escalade owners know. I get all the same admiration *and* hate directed at me as a guy pulling out of the dealer lot in a brand new 2011 Escalade. But I paid *less* for my Escalade than many of you paid for your daily-driving *beaters* that will depreciate faster than rocks dropped over the side of a hot-air balloon.
Haters gotta hate, I guess – and if it makes you feel better to think the guy in the luxury sport-ute or German car is an idiot and that you’re intellectually superior in your rattling, feature starved rust-bucket, you go right on going on.
Seems like there is a lot of anger, frustration, and justification for failed potential in these threads and blog posts, to me.
One more thing, Len…
Delayment of gratification only works if you cash in that good-will before you DIE.
If you die tomorrow, someone else benefits from the fact that you sacraficed and skimped to drive a beat up Honda.
If you can treat yourself to a luxury, to a better experience, *today* – and it isn’t going to affect your comfort *later* – why wouldn’t you?
Living beneath your means is fine if there is an end-goal that you’ll make it to. But if you’re doing it just to show how much smarter you are than the average bear… maybe you’re not so smart, after all. Instead of “bitter much”, maybe I should have asked, “Catholic, much?” Didn’t “self flagellation” go out with the middle ages?
And hey… drop a few bucks more and upgrade your blog hosting service. It seems to be broke.
Wow, struck a nerve, huh? The end goal is called “early retirement.” As a result, I always find it ironic when somebody says I am the one who is delaying gratification by living within my means.
Judging from your comments trying to justify the obvious – that a BMW is a “nicer” car than a Honda – it is pretty clear that your real issue is that you are offended that there are people out there who just aren’t impressed by luxury sedans.
BTW, I apologize for the slow server. I was enjoying a rather large traffic spike yesterday by readers migrating here from MSN, who published an article of mine.
Check it out, if you’re interested. It is an Editor’s Pick!
http://articles.moneycentral.msn.com/SmartSpending/default.aspx?feat=1800240
Len, congrats about getting picked up by MSN and the traffic spike. Unfortunately it kept me from posting a follow up post. No, saying that a BMW is *nicer* than a Honda doesn’t make me a snob, it makes me a realist. The Accord is a grocery-getter designed for housewives and pencil-pushers. Little things, like having a single set of controls in the center, so that the driver *or* the passenger can control everything, like the back windows – is a *driver oriented* “luxury” that BMW understands. Having the radio console slightly angled toward the driver is also a unique feature in BMW design – one of the reasons why BMW wins Car and Drivers Editor choice so often. The car is designed and engineered for *drivers*. It isn’t just their ad-copy. YOUR tone and attitude about *this* is what is offensive.
As far as early retirement, Len – If I chose to live how you describe, I *could* retire now. I live in a 4500 square foot home on 3.25 acres. If I were willing to live in a 2500 square foot home on a half acre or less lot and drive a used Honda accord, My investments would easily cover the cost of living. I’m 40. I moved from California to Ohio before the California real estate market tanked, but after the Ohio market had hit bottom.
I’m not bragging, or trying to make you feel bad. Right place at the right time is often a key part of good fortune and personal wealth. I’ve been fortunate as much as I’ve been smart.
You’ve got a chip on your shoulder about this topic, Len, and you should examine it. Your tone and attitude gives your true opinion away, as well as the opinion of many of the posters here who agree with you.
I appreciate your responses, though, and the article was well written, if disagreeable.
I’m still trying to figure out where you get the idea that I have a chip on my shoulder though. An interesting take, to be sure. You seem to have missed the entire point of the article!
I think you need to go back and reread the post and then quote me the lines that lead you to come to that conclusion.
By the way, why would I feel bad about your financial situation? I’m very happy for you!
The fact that you need to bring that into this conversation here seems irrelevant though. You can understand why it might seem rather egotistical to bring that up in this particular conversation, right? Actually, I bet you don’t.
Mr. America – your first post came across as “pompous”
Bitter Much- Amen, brother! I agree totally. Nice reference to self flagellation. Well done.
My only addition is to quote a well known band:
“Life is a journey, not a destination” – Aerosmith
I live my life by this premise. Sometimes you need to stop and smell the roses along the way.It’s not all about the finish line.
PS- Your going to look pretty stupid caning your way towards your first new convertible convette at 70 years of age. Trust me, my neighbour does this.
I think most people who aren’t interested in driving a Corvette in their 30s and 40s, won’t be driving one in their 60s or 70s either.
I think you are right — buying a used BMW for less than a New Honda is a smart financial move. And paying cash for a used BMW is a even smarter move. The only dumb financial move is financing a used BMW when you could pay cash for a used Honda.
You seem to have a lot of your ego tied up in the car(s) you drive. Many of the posters here do not. I wouldn’t project bitterness and anger into a simple recognition that most cars in the U.S. today are financed, as thus a poor indicator of the net worth of the driver.
Lucky, I don’t think it’s solely an ego thing. It’s more about not driving a s**tbox, when you can afford something a little nicer.
To continue to drive that beater, when you can afford to upgrade, is only another indicator of your cheapness, and trust me, your friends all know who the cheapskate is(you).
“I don’t think it’s solely an ego thing. It’s more about not driving a s**tbox, when you can afford something a little nicer.”
The second sentence belies the first one.
Exactly.!!
The truth is you can’t really know someone’s financial circumstances by the car they drive. It might represent a small fraction of their net worth or it might be 10 times their net worth. Some people, myself included, enjoy quality and can afford to have it. I don’t snub my nose at those who choose to drive a beater, but it sure seems as though they’re snubbing their noses at me. A truly content person should not find it necessary to prejudge people they don’t even know based upon the type of car they choose to drive.
….and yes, figuring out the tip at a restauraunt to the nearest PENNY screams “I’M A CHEAPSKATE” too…..
I can understand both sides of the argument that people have been having here lately in the comments.
First, I understand that it’s not respectable to overextend yourself to try and impress others. However, on the other hand, many of us who *can* afford it enjoy purchasing expensive cars to impress others. The fact that some aren’t impressed gets us down a little bit.
One comment that threw me for a loop was the one about the goal of retiring early. That’s not a goal I’m interested in. Rather, my goal is to stockpile an incredible amount of wealth, a portion of which will be spent on over the top material possessions that are well out of reach for every non-millionaire.
I’m fully aware that avoiding conspicuous consumption helps you get rich. However, once you’re rich, conspicuous consumption is the reward. Wealth without conspicuous consumption just doesn’t sound like any fun.
@Jon. Well said, and brutally honest.
Retiring early is a worthwhile pursuit – but it depends on what terms of retirement you’re willing to accept. You can retire at 20 if you settle on a life in a 1 room shack in Montana riding a bicycle 20 miles into town and back every 4 months to pick up 12 cases of Ramen. And if that is all you need to be *happy*… then *do* it.
But I don’t care if *you* don’t care – and aren’t impressed by – my German sports car… if that is the decision you make. And I don’t think you’re smarter or entitled to any kind of smug superiority for that life decision, either. I agree with Len’s basic thesis in his post, I think the delivery is ambiguous enough that it casts doubt as to how pure his motives are. The tone doesn’t say “live and let live”, it says, “If you’ve bought a luxury vehicle instead of a Honda, you’re an economic fool and I am better than you”.
It is a snobbery of its own sort. The snobbery of denial of self-gratification. Very puritan.
For a troll you’re a funny guy, but if you are going to make intelligent comments you’ll need to take a lesson or two in reading comprehension.
Since you ignored my previous challenge to point out the lines in my article that support your specious claims, I’m going to have to let our discourse come to a merciful end. (Even though it’s been great entertainment for my readers.)
You seem to think that everybody secretly yearns to own a BMW or other luxury car. You seem incapable of comprehending that lots of people see no need to drive anything more utilitarian than a modest used non-luxury sedan. We really really don’t. I know; the truth hurts, Piddly. The fact that you consider that to be snobbery is simply incredible. Even more so considering the self-deprecating title of the post.
Deny it all you want, but it is obvious that you DO care that I don’t care. It shakes you to your very foundation that many people don’t give a wooden nickel what kind of car you drive. Otherwise, you wouldn’t keep coming back here, trying to explain to anybody who would listen that your BMW – and Escalade (!) – are worth the money you paid for it, which they probably are.
But then again, whether or not a BMW is worth the price it sells for isn’t what this post was about, was it?
(That’s a rhetorical question, Piddly. No need to come back again and show that you don’t understand that point.)
For me, car is merely a transportation from A to B. Only attention seekers buy car to get attention (turning head,huh!?).
And Piddly,remember this… you ARE NOT ANY BETTER than people who retire at 20 and settle on a life in a 1 room shack in Montana riding a bicycle 20 miles into town and back every 4 months to pick up 12 cases of Ramen.
Be realistic. Be honest at least with yourself. How much you want to argue,in the end you’re the one who are falling behind.
The race is long,man. In the end you are only racing with yourself.
Relax and enjoy life,man.
Looks can also be deceiving. While not always, every so often I get dirty looks because I drive shiny Mercedes. While I understand not everyone thinks highly of people who drive fancy cars some of them are actually not all that expensive. I’ve always wanted to drive a luxury vehicle. I like the look. So I purchased what I like to call a “Baller on a Budget car.” Before I opened my own business I worked as a Valet guy and I learned that luxury cars tend to drop in value pretty quickly. You can pick up a 3 series or a c class for a pretty good price if you know where to look. They also last forever. (At least in the cars I’ve owned)
Mercedes kept the same body style from 2002 – 2006. (only the interior changed) So…I purchased a 2002. (looks like a 2006, drives like a 2006) It looks like a 30,000 car. (Heck it feels like a 30k car) most people ASSUME it’s a 30k car. Nope, 11k baby and paid off. Repair costs are not to high and it’s been really reliable. The great thing about rich people, when they finally do get rid of their cars they want them gone quick. I’m guessing the money isn’t a huge issue to them. I think so long as your not digging yourself a financial grave, there isn’t anything wrong with driving a flashy car. You just have to be smart in the way you buy.
Now THATS impressive, CM! Thanks for sharing your story. Luxury cars can be bought by people of modest means without breaking the bank if they let the original owners eat the depreciation.
I ride a vintage Vespa scooter all over my city. And the looks people give me are horrible. I am often degraded and insulted by people who find it funny to see me on my bike.Sadly my personal life has been affected. I am often judged as being ‘poor’ because I ride a scooter. I do not see the point in having a car in the town I live in. Its so small and there are few places to park. The scooter works well and its classy, exotic and Italian! But most people just see it as a scooter and the fact that its old makes it even worse. I get judged all of the time. From my education to my career. Though in reality I am established and have appeared in the international media for my work.
I, for one, think Vespas are cool. And I wouldn’t worry about what others think either. After all, my whole point of this article — which was missed by a few people who commented before you — was that it is completely misguided to judge anybody’s financial status by their mode of transportation.
Why comment on other people’s choices like this at all? It’s quite pathetic really.
I drive an Audi for which I paid in full on the first day. However I seem to get nasty & jealous looks or comments (e.g. the bank probably owns your car etc….) on a regular basis. Why can’t people mind their own business and keep their green feelings to themselves? Perhaps spend that energy instead saving up to pay or a reliable well-engineered car that is fun to drive?
The sad thing is, they probably aren’t interested in impressing clever people… oh well
Amen my friend. I used to think otherwise, and spent a lot of money on stupid cars. I now drive a 1200 dollar car and am loving it!
I am so glad you brought this up. This was just what I needed to hear. I just paid off my 05 Malibu a few months ago, and my ex just bought a new 2011 Honda Accord with payments by the way because I tried to help him fix his credit…ehem. Nonetheless, it was one of those thoughts that I had “What does he think he is doing better than me now”, and now I know, that it makes him feel better about himself. Loved this blog!!!
Great post Len!
There will be some people is highly interested when read your post, but some left would just smile and keep thinking that their “car” is their “social status”.
I am not an American, and same condition happen in my country, lot of people still at that opinion and yes lot of them just do it to prove that they is “rich” and success people. And also their is a lot of “Jennifer” in my country. My friend is an example, she is poorly cheat on people to buy a new car, “just to make people looking at me” she said. What a ……!
Thank you, Luke. Again, I don’t begrudge people who own luxury cars. But I’m not impressed by what they’re driving either — and that seems to have struck a nerve with a few folks.
Can it not be that some of us out here actually have good incomes, save and invest aggressively, AND can afford a nice car…I drive a 2011 Acura TL and I hate to think that people look at me like I’m the village idiot as I drive by…
If you bought an expensive luxury car because you appreciate that kind of car and the comforts and performance it provides you, who cares what other people think about you when you drive by, Anthony? Enjoy your car!
Again, my main point is it isn’t wise to buy an expensive luxury car if it is just to impress others — especially if you can’t afford it anyway.
Exactly. I see a lot of people driving these fancy, luxury cars and I’m pretty sure a lot of them can’t afford it. But they want to look cool anyway.
I do not like American or Japanese build quality simple as that. If you buy a brand new car then i can agree you are a fool but look at the used market. I bought my used 03 Audi A4 roughly four years ago with 86,000 miles for $12,000 and i have had absolutely no problems with it aside from regular maintenance. It is paid off and a car with impressive reliability that will run for many many years to come.
If you’re going to buy a luxury car, that is the way to do it, Bryan.
I’m 50 years old and worked since I was 18. I always drove used cars and in fact drove each of them 5-10 years. When they were paid off I kept making payments to my bank account. All this was so I could drive my dream car someday- Mercedes S class. I finally bought one this week and regret people who criticize me. I am gay, will never have children and I never wanted to own a home. I do live in a nice apartment. I’m still working 12-14 hours a day and I deserve my Benz s my big lifetime purchase. Do not criticize people unless you know their lives and their personal sacrifices. Spend your hard earned money however you wish. I now earn 6 figures from my hard work and can easily make my car payments. Walk a mile in my shoes before you speak.
To say that smart people aren’t impressed by luxury cars is not criticism, David. It’s just an observation. Luxury car owners who can truly afford to pay for them — such as yourself — shouldn’t feel threatened by such as innocent statement. I encourage you to go back and reread the article because you completely missed the entire point of the piece.
This is a very interesting article. Having money doesn’t mean you need to have a six or seven figure income it means to save money, invest in smart choices, and use it properly. I live in a fairly private neighborhood (as in people generally keep to themselves). I have a neighbor who has 2 Audis. And another neighbor who has a Ford Focus and a Toyota Corolla. What I realized is that the person with the Audis might have to make sacrifices for the payments or live reserved. The person with the Ford and Toyota can afford to go to nice vacations every year. Being a millionaire isn’t about the job you have and money you spend, it’s about your mindset. I know someone who bought a Buggati with the majority of their savings. It’s really a shame that he spent his savings, he said it’s to motivate him to work harder. Also I have another friend who throws change in the trash and throws dollars out the window of his car because he is an only child and his parents spoil him. I’m 19 years old and I’m really trying to understand economy, money and investing as a concept in deep meaning. In college I might major in business too can someone recommend me some good books in investing?
Your observations and understanding of money belies your relatively young age, Ecowind. Life is a series of trades, and we are constantly making choices with our wallets. That’s why, with rare exception, everyone’s financial position ultimately comes down to the choices they’ve made in life.
Once every ten years, we buy a Toyota Corolla, paying cash. We found just the right car for our needs- one that does not require trips to the repair shop or big prices at the pump. I must admit our car looked ridiculous sandwiched between the Hummers and Explorers my coworkers parked at work, but that didn’t bother me. Besides the lower initial cost of the car itself, we saved dollars on insurance, gasoline, and maintenance. If I had a flashy, expensive car, I would forever be worrying about dings from gravel, scratches from shopping carts, and fender-benders. My daughter drove my Corolla into a curb and scratched the finish when she was learning to drive, but I easily ignored it and felt relieved that it wasn’t a BMW!
I’m not interested in reading all of the comments because I really don’t have the time right now so this may have been said before. It doesn’t matter what kind of car you are driving. At the end of the day you are still who you are. When it comes down to it you can always tell if someone is driving a car because they like it, and can afford it, or if they are driving it to impress the world even though they can’t really afford it. In most cases it is painfully obvious. The same goes for most things. For instance you can usually tell who actually purchased a Rolex from a reputable store from the person who stole the one they’re wearing, or bought the knock-off (these days the knock-offs look pretty good if you aren’t well versed).
I’m sort of on the fence. Both of my parents made over 100k. They both drive luxury cars (not brand new). They bought houses to invest, even went into a fast food business. They lost so much money with the fast food. We sold the business and now, no one is paying rent due to the economy. I completely understand that not paying cash for a fancy car is stupid. When I look back on it i figured they could of spent that money on a nicer car, or anything for that matter. I know they were trying to make our lives better, but as I am about to graduate college Ill get a “fancy” car as soon as reach 100k and just live my life. Yes I want to feel special ill admit it. I didn’t spend all this time in school NOT to drive a “fancy” car frankly. All my friends skip classes and party all day anyway. In my mind I am special. Life is short, as for investing ill be fine with keeping my money under my mattress.
I don’t understand why some of you are so proud to drive sh*tboxes. I own a 2010 hyundai sonata flat out at 19 years old. if you really think a 30k car is a massive investment you should take another look at your finances.
if you don’t think a BMW drives nicer than a honda you have never driven a car that is made to really be driven hard.
also, why do so many people seem to be proud of being cheapskates? at 19 years old I’ve got a 2010 hyundai sonata paid off.
if you really think 20-30k for a nicer car is a massive chunk of change you just might need to look over your finances again
Sometimes high prices can equate to prestige and quality. However, not all people think that way. In China, the owner for most expensive dog today equate price with quality.
I recently bought a Mercedes GLK350. The MSRP was the same as a Ford Edge Limited. I’ve also written a personal finance book called “The Freedom Letters” in which i discourage owning luxury cars, however, the deal on the MB made me buy it instead of the Ford or Toyota.
Good thing I worked hard my entire life to drive a nice 6-series, just to have it rationalized by insecure people driving beaters and all high-fiving each other so they don’t feel bad. Some people have it. Lot of people with nothing to posture about are here posturing because they realize they can’t do it on the road like some of us
.
94,000 for the car – cash – better put elsewhere? Retired before 50. Yep, I’m enjoying my life with nice stuff. Enjoy your minivan. Enjoy your neighborhood and your undervalued house.
I’ll pull a notion from this topic and just not care what people think of me and my car, since we’re all apathetic, right? Yeah, my car sucks but I don’t care because (rationalization).
I guess I hit a nerve there? Either you completely missed the point of this article — or you’re just upset that not everyone turns their heads in awe every time you drive down the road in your 6 series. I bet it’s the latter.
I really hope you are still replying to comments on this subject. This is a subject of much anxiety for my husband and I right now. We own a clinic specializing in sports therapy. It’s a new business and we are doing fairly well at it. We are not flashy people by any means, and we do not like to spend money we don’t have. But my husband drives a very ugly, very fuel efficient Honda Accord. I loathe the thought, but the truth is that people do not take him as seriously because of it. I don’t know why that is – he is a remarkable doctor and therapist. We are looking to purchase a better vehicle with a little more “status” attached but I am in a cold sweat as to whether this is a good idea. We aren’t in a business where our income is automatically known. Financially, we are not quite where we would like to be (we’d prefer to pay cash for the car) but at the same time, we want what he drives to reflect that fact that he is very good at what he does. I would desperately like some advice on the subject especially from someone who doesn’t think cars are a big deal.
You bring up an interesting situation, Zelda. If I were in your hubby’s shoes and I could prove that my car was really and truly resulting in lost business opportunities equal to or greater than the cost to buy a flashier model, then I would absolutely upgrade. Why wouldn’t you, if it would result in a net increase in income?
That being said, the trick is being able to *prove* that your husband is actually losing business because he drives a “beater.” How do you know that with any certainty? To be sure, you would need to poll all of your customers, ex-customers, and potential customers who chose to go elsewhere. Unless you can verify that assumption with a high degree of confidence, I think you may be letting your emotions get the best of you.
If it will make you feel any better, I don’t see why any rational person would judge a person’s professional competence by the car they drive. I don’t care what my doctor drives. In my case, it’s a good thing my employer’s customers don’t either, because the majority of cars in our parking lot are very modest vehicles even though they’re owned by highly competent and very well-paid engineers who design extremely complex high tech cutting-edge products. LOL
I don’t know, maybe it’s an engineer thing, but most of us tend to be very practical people.
Thank you so much for responding. I wish everyone was an engineer. Our best patients are engineers and they love what my husband does, and really do not judge at all.
It is an impossible thing to quantify. We never would have given it a thought if people that we hope to get business from (attorneys, corporate higher-ups, even professional athletes) hadn’t mentioned it. I don’t want to make it sound as if anyone has been rude or snobbish because no one has – we live in a very kind city – but we are definitely getting the impression that the car is making us look somewhat amateur, when we’ve always thought we looked hard-working and thrifty.
Let me give you an example. Some jerk in our building drives a worthless Corvette, and he parks it right next to my husband’s car, so it could very easily be mistaken for his. I can’t tell you how many people come in asking if that is his car and their eyes light up and they get all excited. It has become a little embarrassing to say, no, it’s someone else’s and he drives the Accord with the dangling front license plate. People then smile kindly and tell us that we’ll be able to afford it before long, and that Doogie Howser probably didn’t own a nice car right away either.
The thing is, I think we are being judged more for it because we are not corporate and people can’t determine our success just by asking who we work for and what we do for a living. I’m thinking it’s almost like a review – if you drive a nice car, it is an indication (not proof) that you are successful enough that people keep coming back to you. And we wouldn’t be giving a false impression in that regard – we have a great patient base and it’s increasing. But like anyone with ambition, we want to expand and hire more people and that entails really putting yourself out there especially to people who can afford your services. We’ve been putting all our money into the clinic making sure the patients have the best, but we haven’t given any thought to initial impressions. But I’m scared to death to borrow any more money and I don’t know that I could even enjoy the car with the debt hanging over our heads.
Sorry for the 8 pages of stupid worrying, but we really don’t know the right thing to do and are looking for some advice.
Gosh Zelda. I think my original advice still stands: unless you are absolutely positive that a more “impressive” car will increase your cash flow such that it more than covers the costs, why do it? Especially since you seem to be really tied up in knots over the debt.
Like I said, to rational people, it’s impossible to infer with any certainty one’s professional or financial success by the car they drive. You just can’t. There are too many people driving fancy cars who are in debt up to their eyeballs and one missed payment from having it taken away by the repo man. Likewise there are even more people who drive modest cars who are wildly successful, both financially and professionally.
I’m going to write a new post regarding your concerns this coming weekend, Zelda. I’m interested to hear what my readers will have to say on the topic next week.
Zelda, i get the idea your husbands accord is ugly and very “used” looking, which shows poor maintenance. Thus like you do not care about details. There are plenty of NICE affordable used vehicles available that are clean and fresh looking. There is no need to buy a new Accord/Lexus/Infiniti to impress clients. Just Find a nice clean well maintained car. You wouldn’t wear tattered worn out jeans and a greasy t-shirt to a client meeting, but there is no need to wear an Armani suit either. You can drive a “nice” in expensive car and actually appear to be economically astute and professional. I overheard my dentist joke with another patient once about his minivan that he drove, he said “i never drive my porsche to the office, it scares away the customers”. I do know that he does NOT have a Porsche, as he is very business minded and knows where his money is better used. So upgrade that “beater” to something less beaten, without going into severe debt.
I bought my 1999 Ford “fleet” truck (AKA vinyl seats, a stick shift and an AM radio) brand new for cash in 1999 when we remodeled our house. I hardly drive and when I do, I’m usually hauling wood (I’m a retired guy… and woodworker) My wife’s “fleet” Honda cost about $20,000 cash, but then again – she drives a lot and in traffic so we wanted something that will protect her. Her car replaced a $13,000 “fleet” Honda which we bought in cash and which was totaled when a moron driving a new huge luxury car (and likely unpaid for from the amount the dingbat was stressed over the damage done to her car instead of the fact that she could have killed my wife) But due to the Honda’s excellent bags/belts/crumple-zones my wife walked away with only a few kinks in her neck/back which seemed to eventually go away with exercise and stretching. The point is… my wife and I are not loaded – but we are a lot better off than nearly anyone we know, because we made good money for years and invested it, because our idea of a good time is beers at a pub and not trying the newest ostentatious west-side restaurant, and our idea of a good car is one that transports us and our crap from point A to point B as reliably and safely as possible. As a result, we live in a nice (but modest) house in a really nice old neighborhood with a low crime rate and well-educated interesting neighbors, we have good insurance and plenty of money to spend on our hobbies and travel and enjoying each other and the company of friends. No one’s life is stress free, but I can’t imagine living to support my things. If expensive things don’t make me happy when I’m alive and if they don’t matter when I’m dead, then why the hell would I want them? It’s just ridiculous. Maybe I’m just not buying into the system. Could be that I don’t watch TV. We stopped watching TV about 15 years ago when we figured out that life was more interesting than TV and TV was getting in the way of our time for conversations and walks and little day trips to explore new parks & districts… and many other fun spontaneous things we enjoy doing. Having a TV in your livingroom disrupts your living. Having a TV in your bedroom disrupts your relationship. Don’t be dirty minded – I’m talking about intimacy – cuddling – reading – talking – sleeping. TV is like noise pollution that programs you to go buy crap you don’t need… like a car designed to impress idiots. Nice blog by the way.
Oh, I should add that I retired at 41 when my woodworking hobby stared making me about $15,000 per year. I’m 44 now and this year it will be about triple that. I can’t imagine I’ll push hard enough to get my little business to pay me much more than about $60 or $70K because I don’t want to do the things that would be required to take it to that level. No one knows how they will feel in the future, but I imagine I’ll want to work in my shop as I do now until I become physically unable to… hopefully that will be a long time from now. Am I retired? Dunno. Feels like it except on those rare occasions when I get a jerk for a customer but I generally “fire” those customers (much to their surprise). My wife changed careers recently – now works at a non-profit doing (what her hobby used to be) only now she is doing it with a budget that we don’t have to fund
She had to quit a couple of the boards she served on so as not to have conflicting interests in her new role, but otherwise, she’s just basically doing more of what she used to do in her free time. I don’t think she’d consider herself retired because she has an office and an appointment calendar and co-workers, but it doesn’t seem that she wants to be retired at this point. Retiring under 40 would just be weird anyway. But as neither of us has a Porsche to pay for… I suppose she could ramp-up or ramp-down her workload at will.
I can’t imagine why it took us so long to have the epiphany that a person should follow the path of joy and let the money come instead of following the path of money and waiting till retirement for joy to begin… But then again, maybe I can’t imagine how we had the epiphany at all… because societal programming blinds people to thinking about work and lifestyle as things that can be synergistic. Work and lifestyle are always portrayed as a tradeoff to be balanced. Odd about that. We’re a race of beings smart enough to double our own lifespans, travel to other planets, and build a communications infrastructure that can connect people in meaningful ways to share ideas across the globe as we’re doing now, and yet we can’t figure out how to simply get up in the morning and do productive things that we enjoy. It boggles the mind.
Great insights all. I think that is terrific you are doing what you enjoy. I’m continually stressing the “do what you love and the money will come” mantra to my kids. And, again, I am with you — I don’t understand the allure of extremely early retirement, assuming by retirement you mean either: 1) living like a pauper for the rest of your life to make your money stretch enough so you don’t outlive your nest egg; 2) do nothing productive with your life and just traveling, and sitting around the house.
Why thank you for the compliment. I’m glad you enjoy the blog and I hope you’ll become a regular here!
We have pretty much the same philosophy, Mr. Mous. Although we diverge at dumping the television shows. A lot has changed over the last 15 years. You know, since then, reality television came along and actually made tv fun again!
wait… why do you care what type of car someone is driving? you’re suggesting that people shouldn’t judge you for driving older vehicles, but you’re perfectly fine judging others for perhaps living outside their means? that’s pretty hypocritical. some folks enjoy the finer things in life. some folks want to save every penny. to each their own…
I don’t get it, Joe. Tell me again how saying “Smart people — and I — don’t care what car you drive,” translates to me caring what car they drive? How is that judging others? You need to reread the article more carefully; the whole point of the post was directed at people who buy cars they can’t afford only because they were under the impression people cared.
not eveyone that drives a luxury car has loans on them. I was in a seven car accident where a car landed on me. If I was not in my car (as the fire chief said…”it is a miracle you are alive and able to walk away, your car saved yoru life”.) I was also pregnant. That is why, I will spend less every where else but not on my car. It is my life and my families life also
your
I work in a factory and notice that the new hires drive new trucks and the 35 year skilled trades drive beaters. Guess who has their house paid for and who lives in an unfurnished apartment? My 1980 Oldsmobile gets no respect, but I do not fear the repo man.
Nor do I, Jerry.
If you don’t drive a newer Audi, its like you don’t count. The newer luxury drivers act like they’re rich. Such snobs!! My older Audi A4 which looks really nice still doesn’t fit into the upper-upper class of snob bleeping fools. And I sort of get the cold shoulder when I visit the Audi service shops. Its like my patronage isn’t the same as the guy with the newer Audi. The Audi dealerships show very little customer service towards “real” people and can be rude as well. Luxury service people have no personality or soul as I have seen them display.
Personally I think you lot writing comments about how other people want to spend their hard earned money need to sort your life’s out. I’m 21 and an apprentice. Iv worked the last 4 years on £2 an hour trying to make something of myself and the first thing I’m going to do when I’m qualified in a few months is to go get a flash car on finance, and why shouldn’t I? Iv spent the last 4 years working my arse off and havn’t been able to buy new shoes when I needed them. I’m not from a rich family so I have to pay my own way even though I earn next to nothing. So when you see me driving down the road in an expensive BMW and designer clothes don’t you dare judge me because I deserve this luxury. I can barely afford a pint at the pub with my friends but soon I will be earning more money that most other 21 year olds and probably more that most 40 year olds and if I want to spend spend spend over the next couple of years that’s my decision. Don’t judge me and think that I’m only out to impress you sado’s because the truth is iv worked hard for it and if that’s what makes me happy before I settle down and have a family then who are you lot to say other wise.
Peace!
I know first hand about owning a car that I maybe shouldn’t have or someone else did. I make between $50 – 60k a year and I drive an 04″ Lexus that has around 49k miles on the odometer. I owe less than $10k on the car and it will be paid off in less than three years along with my students loans. Did I mention I pay a house payment too so I can’t afford a high end car and it does not bother me on bit. Other coworkers have told me that I need to get this and get that but I am happy with my 04″ Lexus. Sometimes I think they are trying to get a rise out of me but that don’t. I just tell them I am happy with my $300 payment of which I refinance with money down and for the same amount of months left with lowering the interest rate by almost one percent and lowering my payment by almost a $100 dollars. Some of those same coworkers who try to embarrass me about my car make about the same as me and their payments are in the $500s. Forget that! I want to pay off my car and put that money into a new home! Thank for the article and insight!
You’re very welcome, William. And thank you for your comments.
I have mixed emotions on this article. Though true cars are the absolute dumbest thing you can sink money into (talking major money), they also have some amazing rewards. Also, you can’t judge a book by it’s cover. I would be the stereotypical young punk you refer to in this article that lives way beyond my means and makes very little income because I’m not a programmer. I’m 28 years old and get carded for alcohol every time (I’m younger looking). In reality I own two vehicles. Both are 2009, one is a BMW and one a Silverado. I am a semi successful sole proprietor in the Oil and Gas industry. I have worked since 14 and worked my way through college. I didn’t come from money and to the contrary help my parents (paid for a new roof last year). I have paid off all student loans, bought land, invested 401k, IRA’s etc.
The reason for some what annoyingly bragging? Some young people can make appropriate decisions in life. Now to the cars. The pickup I bought in 09 brand new with the Chevy rebates and Obama tax incentive and some long hour negotiating at the dealership. MSRP was $41k (obnoxious I know), and I walked out the door for $30.8k and that is not the slightest lie. And since then have depreciated it every year in taxes through my company. Since I work in the middle of nowhere with mechanics located anywhere from 80 to 200 miles away at any time, I would and will drive a newer vehicle any day of the flipping week instead of a beater to avoid having break downs in the middle of nowhere in the middle of the winter.
The BMW, was a splurge and sort of dumb. Growing up in ND, these cars were like Ferraris to me. And I always wanted to know what the engineering felt like. I grew up with crappy cars and loved it. Beaters are still my favorite, door dings and scratches do not raise your blood pressure. My 96 Sunfire was starting to run like crap and break down a lot. Since my pickup was across country for work and I lived in FL, I decided to shop around. It took one year and my dream car appeared for the right price. I went in and haggled and negotiated for 5 hours and walked out with a BMW that had never been sold, on paper new with 8k miles on it and depreciated $12k, after negotiations I got it for $19k under original MSRP and $7k under book. How? Research, patience, and being a pain in the A$$ They only gave me $500 for the Sunfire, but I saw that coming way before. And let me say, with the maintenance program BMW has, the car costs me nothing to maintain. Will it depreciate? yes. Was it worth it? Maybe, I don’t know. I love the car and know I will never have to wonder what they are like. It is fast and fun and drives on rails. After I sell it, I will probably get a older Honda Accord.
The reason for this super long post/love story of cars that no one will read? To prove that young people with ambition can have nice things and that I don’t do it for ANYONE but me. It’s not to keep up with the Joneses and to show off. (I am probably the only BMW driver that wears old worn out jeans, plain $3 T-shirts and a sweat marked shredded hat that should probably have a Hazmat sticker on it.) I love technology and reliability. Under the right circumstances and with lots of patience and research, people can own nice cars. Are they financially worth it? Hell no, it will never make sense on paper. But I have broke down enough to know a reliable car is worth a lot. And that driving semi-old Toyotas and mini-vans does not make you self righteous or hold, secretively, anything over anybody.
Robert is right though…..BMW dealerships are the same way. The people there are snobs and pretentious and I DESPISE having to ever go to the dealerships. If I could service the car somewhere else, I would.
Where I come from (the Pacific Northwest), we think people who drive luxury vehicles are douchey. Seriously, those cars say “Look at me! I’m better than you! I make more money than you! Notice me! Love me!Rob me because I make lots of money!” Gag me. The wealthy people where I’m from still drive Volkswagen Bugs or beater cars and don’t want people to know how much money they make–they want people to like them for WHO they are! I’m starting to think that there is an inverse relationship between one’s intelligence and the flashiness of their vehicle. I started to notice this when I moved to FL. There were people that I worked with that made at most $40K per year driving brand new BMW’s. Seriously, wouldn’t the car payment alone rape your entire paycheck and not leave you anything left over for rent or food? What were they trying to prove? Don’t even get me started on women who have to have designer purses with big tacky logo’s plastered all over! My instant reaction is an eye roll.
I understand where all of you are coming from, however keep in mind there are people who CAN actually afford these vehicles. As an example, I recently financed a $44,000 car which I am happy with. The reason being is that it makes me happy not only because it sits in my driveway, but because I worked hard to reach the salary I have and that in itself feels good.
I agree with most people on the board who talk about their paid off cars. I usually buy my cars in cash but with low interest rates today I decided to finance a new fancy car and keep my cash in liquid assets. It is funny how alot of people who drive fancy cars cannot really afford them though. I’d say if you cannot buy a fancy sports car in cash, then you cannot really afford it.
i once hired a handy man to fix the roof on my shed, he came by the next day to pick up a check for the materials in his ESCALADE XL… I almost backed out when i saw that. He can afford to drive an ESCALADE being a handyman?? I cant afford an escalade on my salary, in hindsight he fixed the shed roof, did a good job and probably netted out $50.00 an hour for his day and a half of work. (and HE actually did the work himself he didnt have a crew).
Wow I can not believe this is such a heated subject and maybe this thread is dead but I will give my 2 cents. I have always enjoyed being a consumer and buying high end luxury things. I have realized from a young age trading time for a salary or wage was not the way to go as I would never be able to afford the things I want. I found that if I started a business with the sole purpose to make money and put other people to work to make me money they would gladly come to work everyday and I would not have to work. I now own my own chain of fast food restaurants that make enough money and now since my investments are making enough I buy nice things when I want. I don’t want to manage any more assets. I have found if I put it in the bank and save inflation just makes it more worthless so i may as well enjoy what i want now. I have no way to spend all the money I make as I now travel the world and enjoy being wasteful so If I want to waste my money on high end useless items I feel I can and feel as if I have earned that right. I knew from a young age I wanted lots of money and didn’t want to work hard my whole life so I set it up so other people work under me and earn me a living. Since I don’t invest my time to earn money I could care less how much anything costs. Just thought some of you could see it from a different perspective.
I read almost all the posts here. I will say there is insecurity, as well as non insecure comments on this subject.
Like many here have said it boils down to personal choice.
I have no problem with either side of the fence.
I personally would rather fall in the “baller on a budget” category. I can justify giving the illusion of wealth. Anything, more than that would make me squirm. Game the system buy that used vehicle that looks like it cost more than it does if you want. We all know what they are. You’ll still live below your means.
Great conversation guys and gals.
P.S. I personally like flashy cars to impress the opposite sex. If I said anything else I’d be lying
“Baller on a budget.” Ha ha! Love that term. There are women out there who aren’t impressed with flashy cars, by the way. In fact, I’d argue you might be better off attracting a gal who ISN’T attracted by a flashy car. (At least you know she is interested in you because of YOU and not your car.)
P.P.S. Due to burning the midnight oil. I failed to make a correction on spelling of my user name. As you can you now looking at this comment. 0///0 o///o
p.p.s. afeciando is spelled aficionado, so, i changed user name 0///0 o///o
Len I thought about that, and, maybe you’re right. On the other hand, when you live in a society where there are many alphas going after the same most beautiful women in the world. You better have either an overwhelming reputation(famous), or, an overwhelming perception.
Women who get alot of attention everytime they step foot out the door don’t have time to learn about how great a guy I am in my rusty pinto. They are seeing all types of guys stopping them in traffic, grocery store, church, and, who knows where else. I have to be on my “A” game. This means I need to be James Bond, Bruce Wayne, or, “the Dos Equis commercial guy”.
What woman don’t want that kind of excitiement?
Creatively consume frugally
http://www.wikihow.com/Have-a-James-Bond-Lifestyle
I don’t know how old this interesting thread is but I’d like to comment on something I didn’t see in the other comments. I read most, scanning the judgmental ones. Some of us have occupations that require driving, a lot of driving. I have been behind the steering wheel since 1974 and am closing in on 1.5 million miles. The last 600,000 miles were in two Hondas, a Civic and an Accord, both good cars. Two because a Cadillac took out an otherwise perfectly fine Civic with 297,000 miles in a front end collision. When I turned 60 with over 300,000 miles on the Accord, bought used, I was tired of the road noise and stiffer ride of Hondas. I wanted to end the career in something more comfortable, quiet and easier on the body. As a person who has driven that many miles with the compressed vertebrae to show for it, the choice of car was for my benefit without regard to what anyone else thinks, or may use to judge my financial success, which is no one’s business anyway. I looked at various new cars and found the best deal for me was a used Lexus paying cash. It was less expensive than the cost of lower trim line new cars. I now have 98,000 miles on a six year old car with zero repair costs and it gets 32 mpg. It is the best car I have driven and a pleasure to drive. Having spent my life in the front seat of a car, what I drive is important to me. What others think is of no concern. I’m sure there are those who buy to impress. I just wanted a comfortable, quiet, reliable cruiser and I have it. The only surprise has been the fuel economy with the Lexus being more fuel efficient than the Accord.
Thanks for sharing your thoughts on this. I certainly appreciate where you are coming from — I may even take the same route you did, buying a 2 or 3 year old luxury car after my Civic bite the dust (although it only has 150k on it now — so it could be awhile). That the Lexus is more fuel efficient than the Accord is a surprise.
You people talk bad about others having nicer cars than you. I honestly think that your all haters. It’s not just the fact that your driving a nice car to look cool but its also the reliability and safety and comfort of a luxury car that a cheap honda or toyota won’t give you. In my house hold my parents, my two sisters and i drive German vehicles and were proud of it and were very happy with our cars. I’m 20 years old and my very first car was a 2004 Audi A4 that car was paid cash for I was 16 I loved that car. That car only lasted me a year it got totaled after a drunk driver hit me from the passenger side and trashed my car should I have been in a stupid honda I probably would’ve been sent to the ER or probably dead. My second car was a 2006 BMW 330i that car wasn’t paid cash for but I did put a lot of money down and my payments were only about $230 a month for 3 years I paid it off quickly and gave that car to my sister now I drive a 2010 Mercedes E350 and i love my car I would never drive anything else or trade it for any other car out there.
So much venom in these posts. Wow. Judging by the broad and hyperbolic statements I’ve read, I would say that you are the type of pellets that see a priest and assume he is a child molester(you know what I mean, shut up. It’s an analogy)
I am 20 years old and work a full time retail job and part time sales job and I drive a top level Mitsubishi eclipse with every option. Around 30k$ am I so deluded as to think it impresses chicks or makes people think that I’m rich? NO, AND LIKE YOU PEOPLE, I DON’T GIVE A FLYING F*** WHAT PEOPLE THINK ABOUT MY CAR!! I happen to be into driving and take my car to the track regularl for fun. I spend most of my disposable/leisure money on cosmetic/performance parts for my car. I rent an apartment. I guarantee the majority of you people bought houses that you are financing for 30 years. Please, explain to me how this is different? Yeah, cars depreciate, so? I enjoy it and it is my hobby, who f***ing cars what it will be worth in 5-10-20 years?
Not me. Chances are I’ll have so much extra time, blood, sweat and parts put into I won’t wanna see it go. Unless you people bitching about the “stupidity” of people who enjoy nice cars and THANKFULLY WE LIVE IN AMERICA, WHERE PEOPLE CAN CHOOSE TO BUY AS THEY PLEASE live in a shanty you built from wood you cut yourself, with no electricity, running water, and heat, wearing potato sacks for clothes then you are EXACTLY THE SAME as these abominations upon whom you so readily paint a scarlet letter. WHAT?! YOU GO BUY CLOTHES? YOU IDIOTS! YOU HAVE A TV? YOU IDIOTS! YOU HAVE INTERNET AND PHONES AND HOMES AND TOYS AND APPLIANCES? YOU IDIOTS! You should be saving all of that money that you are wasting!! How dare you use money for which you have worked to pay for something which you enjoy! That’s stupid and I hate it. You are clearly just trying to impress me because I have such delusions of grandeur that I assume anyoe who dares to spend a dime ABSOLUTELY MUST be doing so in hopes that my opinion of them will be slightly better!!
Seriously, do you guys hear yourselves? Yeah, dummies go and live outside their means and get cars defaulted on. So do people that buy houses! some people can’t afford children yet have them. If I make a PERSONAL choice to spend a portion of my income on a nice car because I enjoy driving and have a tuning hobby, who f***ing cares? Do you REALLY think cost drivers of nice cars are doing so to impress you? That’s honestly disturbing.
Feel better now?
Go ahead and dont approve my comment! Why would you? It adds perspective and valid counterpoints to these arguments. I won’t be mad or anything. I know at least someone has to read at least some it to deem it unfit and that’s enough for me.
LOL!
I didn’t censor your comment, Tex. The automated comment system did because you lost your temper and let a few f-bombs fly, as some of the more emotional people who come here are wont to do. I’ll edit out your f-bombs and then everybody can read your rant. K?
So I have a 15 year old BMW with 150k miles. The A/C barely works and I am waiting for the next shoe to drop. If I were not able to work on the car myself it would be expensive to keep going. However, I make over 6 figures a year not including my wife’s income or dividend income. I could pay off my house (we owe $175k) by writing a check at anytime and have plenty left over. But at some point you realize that life is short and you need to enjoy some things you like, too, instead of watching a bunch of numbers in a stock/savings account. So if someone likes cars, what the hell, let them buy a fancy car. It’s their life. BTW- I am buying a 5 year old Jag to replace the BMW. New price – $78,000 – my price – $18,000 – with a warranty. So if you see me driving down the street in an $80,000 Jag, don’t laugh with contempt that I am spending a fortune – I probably spent less than you did for that Honda Accord you are driving.
And I can still pay off my house – and this is one of the reasons why. Now, people who go buy a brand new fancy car and take $60,000 in depreciation over 5 years – yeah, I feel bad for them. But oh well, it’s their life not mine.
Honestly, instead of sitting there and seeing people with nicer cars than you and saying “Look at those stupid people who don’t know how to invest their money and are knee deep in debt!” you might want to consider the fact that someone else in this world has reached a higher degree of success and has all of their money in the right place and can still afford to pamper themselves because of the hard work they have put toward making themselves financially flexible instead of having to sit in the same car for 20 years. Don’t stereotype and say that all wealthy people are stupid and can’t get a grip on their money. I work hard, earn very good money, and therefore have the right to buy the car I desire and still have financially security.
I would not drive a used car – period. I would only buy an BMW or Porsche or Jaguar! I have a reputation to keep. Being 20 and full employed; I need to show the ladies that I am the “Man” and my friends that I am a somebody.
anonymous you must is being sarcastic because surely you can keep your reputation in a used luxury car.
I’ve read a couple people’s opinions on here and I have to say that the original article sounds like it was completely taken out of context. Reading through a couple of the articles I would have to agree with Mr. America’s post. Listen – living within someone’s means is the problem. If someone is living within their means and wants to buy a luxury automobile and can afford them then who are you to judge. There is no question they depreciate but then again so does everything in life. If you are happy with your purchase the hell with what people think. I may think a boat is a terrible financial investment…but that doesn’t stop me from going on my friend’s yacht and celebrating New Years now does it? Why? because it’s beautiful and the guy is financially secure. Am I going to tell him he made a bad investment or enjoy the 500 dollar of wine he usually serves his guests. Bottom line – enjoy your life and stop judging people that are more fortunate than you. If they can’t afford it – then fine…”they made a poor decision”. You’re on this earth only once in your life..don’t waste time judging others and worry about what you can do to be successful and secure.
Luxury cars just prove how materialistic one is. The money spent for that car can be used in other MORE USEFUL things. Can even feed a whole bunch of people. A normal car would do for as long as it gets you where you need to go.
I own a 2005 Corolla, but I only basically use it at nights after work or on SOME weekends. I mostly use my bicycle and mass transit to get around. I love to read, and I find that I get so much more reading done when I catch the bus or the train.
I simply don’t understand the love-affair with cars. I just don’t get it.
HAHAHA I read this article and immediately thought of…myself!! I have a new BMW 335i x drive coupe and I probably can’t even afford new tires right now lol. I know it’s irresponsible, but I like it. I paid $56,700 cash for the car so it is paid off. I had a really good job, but the “trustees” of the company I worked for seem to think that my job was a waste of money. I totally agree that one must plan for the future, cause you never know when your cash cow will run out. However, it should also be noted that if anything-and I mean anything-happens to my car in the next six years, it will be repaired or replaced for free! This includes brake pads, rotors, electrical, mechanical, etc. On one hand, I spent unnwisely, but on the other, if I had a 1997 corolla that broke down tomorrow, I’d be walking. hopefully I’ll finish my degree (I’m going to school for dentistry) before my warranty runs out so I can afford the repairs, because I’m the kind of person that will own this car until the wheels fall off (then spend every dime I have for another one!!) You know what? I like it like that!
Thanks for sharing your story, Alex. My only comment is in regards to this statement:“On one hand, I spent unnwisely, but on the other, if I had a 1997 corolla that broke down tomorrow, I’d be walking.”
Actually, if you had a 1997 Corolla that broke down, you’d still have about $54,000 in the bank (that you didn’t spend buying your BMW) to make repairs — or buy a two- or three-year old economy car for a relative song.
Couldn’t agree more with the premise here. For the fancy car drivers who are threatened by people not being impressed, you’re proving the point that it’s an ego issue for you. If you’re secure in yourself, you wouldn’t care what we thought. You’re loaded, you treat yourself, good for you. Some of us just think differently, and in fact, choose to rebel against the marketing forced down our throats since birth.
I have a 12 year old car, as well as a 32 year old car I’ve been fixing up. I get compliments on both, because I keep them in shape. Not that I care, I would love them anyway. The older one (Lucy) used to look like a Mad Max machine, faded paint with moss. I gave her a new paint job and tuneup. She now runs like a champ and is a revived beauty. I see so much blind consumerism and conformity, so I appreciate the older cars. They add character and spice to the highway, and although I could afford a new car, I don’t want one. It’s a dumb money move for me. And as a woman, give me a man tinkering on a old pickup with his own company and money in the bank, over a flashy guy with a flashy car and no savings, self esteem or brains any day (I’ve known plenty of those.) You can afford a fancy ride? I’m happy for you. But not everyone shares your priorities. I like my men like I like my cars, with plenty of character and in it for the long haul. Smart people see through facades.
Luxuries are luxuries period. If you can afford them, great, you only go around once. If you can’t Don’t buy it, sucks to be you.
btw… this applies to cars as it does to women’s shoes.
We all WANT. Right after we got by the NEED.
Glad I stumbled across this article, because I wholeheartedly agree and wish more people understood this. My husband and I drive a long-ago paid off 1998 Ford Mustang, and I would still be driving my 2001 Honda Civic coupe – which was two payments from being paid off when it was hit totaled – if I had the option. We got a decent settlement for it, and I then purchased another used Civic, this time a 2008 sedan with heated leather seats and nav, because I wanted a little bit of ‘luxe’ while still getting good reliability and great gas mileage. But sometimes I miss that coupe and kinda wish I still had it – and NO car payments!
We could afford much nicer cars, but we have chosen to invest in a second home instead, which was a foreclosure we got a great deal on; and it is not a depreciating asset like almost all cars are (unless you’re spending the major bucks on a collector car which may appreciate over time), but rather is being turned into a fantastic income-generating rental property this month. Not too shabby for being 30 years old and under, huh?
I might add that we are not opposed to having one small car payment and may need to buy a third vehicle soon; but I can guarantee you it won’t be anything brand new, and probably will be something we can pay cash for. I try not to judge those who are willing to pay through the nose for “luxury” cars, because we all have different priorities; I’m just not willing to do the same – because, like you, I think it’s just not smart.
P.S. The real reason I’m commenting is not to brag about what a genius I am (haha), but to ask if I’m retarded, or is there no button to link and share your material on facebook? This is something I would like to help circulate
Beer income buys beer…
Your buying a Honda because that is what you can afford.
A person with lesser income may look at you buying a vehicle with a nav system as a BIG SPENDER, why spend hundreds of dollars when you can buy a perfectly good map for 3 bucks.
Danny, why you gotta be a hater? I’m a smart shopper and I paid the same for that Civic as ones without nav, so I’ll save my three bucks for a map everywhere I go, thanks.
P.S. Do you own two houses? That’s a lot of beer money, to put it in layman’s terms.
[...] This post was mentioned on Twitter by Len Penzo, Jason Price. Jason Price said: I Like: Why Your Expensive Luxury Car Doesn’t Impress Smart People. (Or Me.) http://ow.ly/17qnKw [...]
[...] Why your expensive luxury car doesn’t impress smart people @ Len [...]
[...] But there is nothing more frustrating than trying to shake a Magic 8-ball and read an answer while driving a stick shift in rush hour traffic. Especially when it tells you to “Concentrate and ask [...]
[...] and the Bill for $1,055 (860) 8. The Ugly Truth: Why Big Spenders Are Terrible In Bed (796) 9. Why Your Expensive Luxury Car Doesn’t Impress Smart People. (Or Me.) (710) 10. 12 Good Reasons Why You Should (and Should Not) Pay Off Your Mortgage [...]
[...] because everything he owns is paid for – and has been for years.18. He’s not impressed that you drive an over-priced luxury car and live in a McMansion that’s two sizes too big for your family of four.19. After six months [...]
[...] morning-after musings: “It looks like I’ve been taken for a ride.” Remorse meter: The idiot light is definitely ON. Comments: Every time I see one of those commercials where the happy housewife looks outside the [...]