The four most empowering words for any consumer these days are, “I can’t afford it.” We live in an age when people overextend themselves to buy stuff. It’s a scenario that occurs every day at car dealerships. Here are 16 lies some people tell themselves to justify purchasing a new ride.
I Need It
Many people can’t distinguish a need from a want. If your current car is past its prime and being held together by gorilla tape, you might be able to justify trading in the old clunker. But unless you can afford to buy a brand-new vehicle, nothing’s wrong with a quality used ride.
I Deserve It
Just because the neighbor across the street has upgraded to a brand-new car doesn’t mean you have to. That’s the perfect way to find yourself swimming in more debt than you can handle.
I Can Afford It
Perhaps you can. But consider this: Just because you can afford the monthly car payments doesn’t mean you can afford the vehicle. The average monthly payment for a new car is $735. Before you pick up the pen and sign the contract, ask yourself, “Can I really afford this?”
My Current Car Isn’t Worth Fixing
Another lie some people tell themselves to justify buying a new vehicle is that their current car isn’t worth fixing. While your vehicle will eventually get to a point where it’s not worth repairing, some people rush their old cars to the wrecking yard sooner than necessary. Sinking one or two grand into your current ride might make more sense than getting a car loan.
My Ride No Longer Meets My Needs
Some feel the need to upgrade their vehicles because of changing priorities. Maybe they want to go camping or fishing and believe their front-wheel-drive hatchbacks won’t cut it. Upgrading to a larger vehicle with 4WD or AWD might seem like a good idea, but that’s a lot of debt to take on for activities you may do only occasionally.
I’d Be a Fool Not to Take This Deal
When sitting across the table from a car salesperson, you might feel you’re getting a steal of a deal. And you may very well be. But here’s the thing. If you don’t have the financial flexibility to finance a new vehicle, you might have to pass on even a great deal.
I Make Enough Money to Finance This Car
You very well may. And if you do, have at it. But many people purchasing brand-new vehicles can’t afford to do so. One source recommends spending no more than one-tenth of your yearly gross income on a car. So, if you make $50,000, you shouldn’t spend more than $5,000 on car ownership expenses. That’s not a bad rule of thumb to live by.
Buying a Used Vehicle Is Like Throwing Away Money
Contrary to what many believe, a used car isn’t automatically a lemon. If buying used concerns you, find a certified pre-owned ride and select a reasonably priced warranty.
I Need a New Vehicle for My Job
That may or may not be true. Only you know. But buying a new car for a job you’ve just started might end up biting you in the behind.
I Need the Tech a New Vehicle Offers
It’s easy for people to convince themselves that the features of a new car are worth going into debt. According to the Federal Reserve, Americans owe $1.616 trillion in car loan debt. That’s 9.2% of consumer debt. Unless you like sinking further into debt, be careful.
Depreciation Isn’t a Problem for Me
Most new vehicles lose 20% due to depreciation in year one. Another source says a new car loses approximately 60% of its worth after five years. Can you afford that depreciation? Unless you have a large net worth, the answer is probably, “No.”
A Used Car Won’t Meet My Needs
While there’s nothing wrong with buying a new car if you can afford it, you can get what you need with a used vehicle. Buying a car that’s a few years old means you’ll sidestep most of the massive depreciation hit and still get a reliable ride that’ll last for years.
I Must Buy One Today
One of the worst things you can do when shopping for a car is rush a decision. That’s asking for trouble that might leave you with a major case of buyer’s remorse.
This Is a Once-In-a-Lifetime Opportunity
There’ll always be other deals. So, don’t allow yourself to get so excited that you sign up for a new car without carefully thinking things through. Long after the new car smell is gone, the monthly car payments will remain.
I’ll Pay Off the Loan Early
You might have every intention of paying off a car loan early. But most people — despite their best intentions when signing on the dotted line — do not pay off their loans faster.
I’ll Get a Co-Signer to Make It Easier to Buy a New Car
Getting someone to co-sign a loan might make it easier to get approved for financing. But why would you want to do that to someone you presumably care about? If you know you can’t afford a new car but get someone to co-sign for you, they’ll be on the hook if you can’t pay. That’s the perfect way to damage a relationship.
Be Honest With Yourself When Buying a Car
Few things are as exciting as buying a car. But be careful, and don’t bite off more than you can chew. If you must purchase one, keep all options on the table and make the right choice.
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