We're just about at 1M! Thanks for all the support and love 🙏 Make sure to checkout the Free 🐪 Hump Days Newsletter ➭ humpdays.substack.com

@Car_Fanatic

Жыл бұрын

Love you this video helped my dad alot he's getting a new car soon

@johnfijnvandraat

Жыл бұрын

Based on the 20 4 10 rule I can't afford a car even of I paid cash because all of my quotes were 20% of my income for insurance due to medical risk (clean driving record)

@jordanloftin9915

Жыл бұрын

Congrats on the 1 mill!! 🎉

@Ultrajamz

Жыл бұрын

Why not finance to 7 years but pay it off in 4? Gives you room if an emergency happens.

@rollakid

Жыл бұрын

I live in Malaysia. A Honda Civic starts at 29k USD, and earning 30k annual household income put you in the top 20 percentile of earners. It's normal for people to spend up to 1-2 year gross income or more for a car, taking out a 9 year loan. I almost did that 12 years ago, but I got smart(er) and bought something closer to 1 year income, and paid it off in 3 years. It was a tough 3 year, and I still have that car as a spare car.

Having no car payment is one of the best feeling ever. I make over 100k a year, but still drive a 2014 Honda Civic. As long it gets me from point A to point B then I'm good.

@humphrey

Жыл бұрын

thats awesome.

@mr.boostang2064

Жыл бұрын

Same, I drive a 2016 Corolla

@Goggarin1991

Жыл бұрын

Same here bro. I make 60 K a year, and have been driving my 2008 Honda Accord for 8 years now, even thoug i'm going to replace it soon.

@XxXK9

Жыл бұрын

That’s incredible considering people at make 30 drive benzes

@mr.boostang2064

Жыл бұрын

@Xx XK9 live below your means, do that long enough, and eventually, the Benz will be considered a small purchase.

I love talking to suburban moms about their car choices. They say all they want is something that gets them from A to B. And then they get a 7 seat land yacht for the cost of a house.

@bosshoss6640

11 ай бұрын

I mean. It shouldn't cost that much. Even used with 100k miles being 30k it's crazy. I guess I need what they are smoking.

@mgloriousone9823

11 ай бұрын

Oh, it's the same with new drivers. I took my buddy and his 16yr old to look at a car for her (he knows nothing about them so I was brought in as their "expert" ). He wanted something for her that was reliable and had cheap insurance, then asked if a 2018 nissan altima was "okay".

@sheilymejia8375

11 ай бұрын

@@mgloriousone9823 ​​⁠ lol a novice here, but is a Nissan Altima 2018 not good as a cheaper option? I really don’t know

@wingnutmcspazatron3957

11 ай бұрын

Women always feel the need to save face before letting their true desires out.

@dnegel9546

11 ай бұрын

Its always the parents with 1 kid that feel they need a 7 seater suv or van. As someone with 2 kids And 3 nieces i have managed with a sedan just fine specially once they got older.

This makes sense if you only use a car as a means of getting from A to B and don't consider cars your hobby or something you're enthusiastic about. Because if you do then a large part of your "fun" money will also go towards your car(s), whereas other people would put the same money into going out clubbing, having frequent vacations, playing golf, drinking at the bar every other night, etc.

@Tracklyfe_T

6 ай бұрын

Very well said !! .

@KseRBanshee

5 ай бұрын

Yes, some people treat car as something that move them from A to B. To us car enthusiasts, car is a hobby lol

@cloudoftime

4 ай бұрын

That's why he said, early on in the video, that the higher percentages are going to be for enthusiasts.

@Henry_Aguirre214

4 ай бұрын

@@cloudoftime35% is “agressive” he said… for car enthusiasts? I don’t think so. I’d say 50% is more realistic.

@cloudoftime

4 ай бұрын

@@Henry_Aguirre214 Great. You can disagree with the percentages he gave if you like. That was not the point of my reply.

The range in 20% to 35% in vehicle expense was very useful. Sometimes, a household lives on a single salary, and two vehicles are needed, having a min and max benchmark really helped

@YogiTheBearMan

12 күн бұрын

This is my situation. Guess we’ll replace one car and then the other once it’s paid off. Hopefully car 2 holds up during that time!

@janek13ko

Күн бұрын

Does it apply to the full price of a vehicle or a yearly leasing cost?

So basically if you work your way up to a $50,000 salary (which can take 5-10 years) you finally have enough to finance a 2015 Prius with 100k miles. What a time to be alive.

@Superb_Legend

Жыл бұрын

If you not starting a job making 40k something wrong

@antimatt_r

11 ай бұрын

I just got my first 30k a year job at 32. This video makes me wanna off myself

@jonathanbelmares8241

11 ай бұрын

What do you do for work?

@johnjones393

11 ай бұрын

5 to 10 years? If you're not starting at over $40k then you're doing it wrong. I know a guy who just started a job running a forklift. He's starting at $50k with no experience.

@chancemcclendon3906

11 ай бұрын

@@Superb_Legend you would be supprised how little people are paid even for education required jobs

As a 19yo college student finding a car that’s 10% of my salary is basically impossible. Inflation and car markets are so fun!

@RGE_Music

11 ай бұрын

buy private!

@marcelslofstra2157

11 ай бұрын

Buy a bike. Take the bus.

@BrettEllingson

11 ай бұрын

Don’t have a car in college. Live on campus or close to campus. Take bus and bike

@yourenzyme

11 ай бұрын

@@RGE_Music private market is just as inflated. people selling their cars sees what dealerships are selling for and prices them similarly. A used car that you could have gotten for $5k a couple years ago is now going for $10k+

@existentialrap521

11 ай бұрын

@@RGE_Music That works when you have rich family and friends. If you grew up poor, your surroundings are poor, so they're also scavenging cheap, reliable cars.

I bought my 2007 Honda Accord 2-door coupe in 2013 with cash (my biggest purchase during my my first job out of college). The previous owner took great care of it and I absolutely (and still) love the car! It’s helped us through some really difficult times, but also shared with us the most amazing memories! Our two toddlers don’t ride it much anymore because the lack of backseat space. I make 300k+ now, and yes the thought of buying a 100k+ “luxury” vehicle crossed my mind multiple times, but my wife and I would drive our beautifully kept red Accord for as long as it allows us!

@MrSnrSquishy

10 ай бұрын

The 07 Accords are a beautiful car, I love modified cars and have always though the Accord was one of the best looking cheap cars out there.

@daveclark8337

10 ай бұрын

That is probably one of the most reliable and easy/cheap to maintain cars ever built. There's a guy who hit 1 million miles in one with the original motor recently.

@dwightschrute4560

9 ай бұрын

​@@daveclark8337one million?? 😂

@ljpr360

3 ай бұрын

Accords last. Getting a newer used Accord sedan wouldn't be a bad purchase. The 11th generation isn't as Nice as the 10th Generation in my opinion.

@americanboy1332

23 күн бұрын

So where do now your toddlers ride? 😂

these numbers are so wild basically most people cant even afford a decent old used car. at $40,000/year theres basically ZERO cars that you can own with a total monthly payment of $333 including insurance and maintenance. thats literally impossible

@americanboy1332

23 күн бұрын

Yeah.. in 2021 I was earning $40k, bought a used 2018 Kia forte for 15 grand total (5 grand down) and I was paying 190 a month plus 90 for insurance, but now insurance raised to $160 a month so I'm already over your budget 😂 not saying that you won't be able to have this low payment now... And now I'm also afraid it may get stolen by those Kia boys 😂😂😂

Never thought I would see the day when having an 80k salary can only get you a Corolla. 🤣

@Hoopers_s

11 ай бұрын

More like a smart car

@mikezerker6925

11 ай бұрын

IKR!!

@Templar0311

11 ай бұрын

Right? As I was watching this, all I could think was "damn if everyone followed this 90% of us would be driving beaters" lol

@Templar0311

11 ай бұрын

Vehicles have always been my hobby, and naturally I like the cool ones. As such I save up and put huge down-payments on them so I can have something nice, but still be in a good spot financially.

@gerrya2133

11 ай бұрын

A corolla in 1980 cost like 5k to 7k if I googled that right. Today they're like 30k. Wages have not quadrupled to 6x'd to match. Yes, 90% of people probably *should* be driving beaters.

I do think it’s very funny that for the past 70 years we’ve prioritized infrastructure that makes not owning a car extremely inconvenient and then halfway through that infrastructure boom we ended up with an economic ecosystem where a significant and growing portion of the population can’t even afford to purchase a car without going into debt on a depreciating liability

@franko8572

11 ай бұрын

All by design, G. Step one, get them in a position where they need cars, step two, raise prices on cars. What are you going to do, not have a car? See step 1.

@gaiusjuliuscaesar9296

11 ай бұрын

That's what happens when corporations control the government

@droe2570

11 ай бұрын

You can thank your politicians.

@mikerotchburns42069

11 ай бұрын

And then went into a global lockdown where car manufacturers stopped, driving up the price of used cars to be even more unaffordable

@Bluntobject

11 ай бұрын

All the government wants is worker bees. Put you in debt so you can never stop working. You will soon not own anything and your whole existence is cloud based payments, forever.

One thing that often gets overlooked is registration costs and insurance costs. Our current 2 cars (14 and 15 years old) cost only $60/month for registration and insurance. 2 cars that are just a few years old could easily costs 6X that.

Getting a brand new car was the biggest financial mistake I had made in several years. Getting rid of it and getting into something cheaper was the best decision at the end of the day. One lesson that I learned is that cars all essentially serve the same purpose (for most people), getting you from point A to point B. IMO the biggest reason that people get expensive cars is for the vanity of it.

@austintomkewitz3981

7 ай бұрын

Except it's not an opinion

@Shay416

6 ай бұрын

At least you did it. Too many ppl keep suffering in their stupidity

@Cortezuma

6 ай бұрын

Some new cars are better choices than used cars. In particular, some models of Toyota. I bought a new 4Runner and drove it for 2 years then sold it for $2k less than I bought it for. So less than $85/month basically, and every single piece of that car was covered under a full warranty the entire time I drove it. Most cars don’t hold their value like that, but if you’re smart you can make out on a new car.

@averya.8622

6 ай бұрын

Used car market is so messed up, that there are some brand new car options that make sense. You’re getting maximum warranty benefit and that can go a long way.

@elmohead

6 ай бұрын

I bought a BYD for 40k. Now it's worth 50k since they bumped up the price.

Problem is that used car now a days are going for almost as much as the new ones, it looks like a terrible deal even if it is 2-3K cheaper.

@Chitario

11 ай бұрын

My new car (leased) costs about 27k new. Got it for 18.7k Payed 8k upfront, will pay 130 each month for 4 years. Can buy it afterwards for another 7k. Which adds up to about 22k. Car is almost brand new also

@kidamere2408

11 ай бұрын

@@Chitario not sure i see the logic your paying the same price either way you lease or buy

@dudeman3186

Ай бұрын

I’m trying to buy a truck and anything under 15 years old with less than 150k miles is around 12-20 grand. By this videos logic there isn’t a single running 4x4 truck I could afford as a college student

@MaSa-bp5qe

Ай бұрын

@@kidamere2408the logic is if you don’t like it or it breaks down before the lease ends you can return that crap.

@americanboy1332

23 күн бұрын

​@@dudeman3186why would you need a 4x4 truck as a college student? He's talking about a-b cars which are low end used cheap cars 😂

Wages just haven't kept up with car prices. $1000 car payment is insane. That's close to a mortgage or rent for something that's going to depreciate 50% over the next 5-10 years. Even the used car market is ridiculous.

@FefyGT

11 ай бұрын

Stop buying family cars that cost more than a sport car if you want the price to drop.

@LiquaFoo

11 ай бұрын

Have you priced a mortgage or rent recently? It’s almost 3k or more. Between rent and a car they are close to 4k a month

@ickster23

11 ай бұрын

It's almost like closing down the economy for 2 years, printing tons of money, and implementing net zero policies are driving prices way up.

@mayssm

11 ай бұрын

@@ickster23 Also massive tariffs and bad trade deals.

@spacetoast7783

9 ай бұрын

Unless you're talking about the last three years, this is a lie. Middle class wages have outpaced inflation for about 75 years, and car prices have lagged inflation.

Paid my car off this month! So happy, hoping to keep for as long as I can with little to no trouble!

Well done video. I am in the car business and work for a high end store and it amazes me how many people will come in and pay a crazy amount of their income on a vehicle. I even had a couple in their 50s that wanted to buy a house and were told to lower their car payments. When I suggested the nice low miles Honda we just took on trade, the wife said she wouldn't drive "that" and instead she wanted the brand new luxury car that was increasing the current car payment.

@Dbb27

6 ай бұрын

I’m a Realtor and have seen way too many people turned down on a loan because of car debt. They are short sighted and hopefully won’t end up like your fifty year old couple. No house and a flashy car.

@Shay416

6 ай бұрын

At that age, it’s just sad

@treeroofgrass

5 ай бұрын

😮😮😮

@Dbb27

5 ай бұрын

@@Shay416 driving their quickly depreciating net worth.

I bought a Honda Civic (all cash) 21 years ago (synthetic oil, regular maintenance and easy driving is the secret to its longevity) and, at 67, think it might be the last car I ever purchase. For the first 19 years of ownership I was making ‘car payments’ into my investment accounts. I retired two years ago and wake up every day realizing how wonderful it is to be debt free. A reliable car, taken care of, can be a wonderful financial tool. And so is this channel. Believe me, you’ll be old one day and you’ll be glad for the advice offered here.

@user-sk7ji5wu5f

Жыл бұрын

⬆️Get in touch with me!❤

It’s been 18 years and I’m still driving my 2005 Corolla. 13-14 years of no car payment!

@i.d.6492

Жыл бұрын

Ok

@bw1532

Жыл бұрын

I'm going on 19 years with my 1997 bmw (paid $7000 cash in 2004). Lots of diy, but it still puts a smile on my face. Stay away from turbos, automatics, SUV's and staggered wheels and you are my kind of person.

@mitchbandalan9450

Жыл бұрын

Still rocking my 2008 VW Jetta

@submissions72

Жыл бұрын

You're the real MVP!

@MrFuchew

Жыл бұрын

My parents have a 2005 corolla they bought new and beat the shit out of. Still going at 200k miles with absolutely abysmal maintenance history.

Car notes are insane now. My dad never paid more than $210 dollars on a car note, now the average is $700, not to mention the rise in interest rates. As long as buyers keep accepting them, they’re going to continue to rise.

Your point on opportunity cost was some of the best advice I heard when I was buying a car last March. I went with that approach and it ended up saving me thousands. I watched many other advice videos at that time and nobody else mentioned that tactic.

@user-mp2vu6xl8p

16 күн бұрын

Hi there! I’m not sure which vid of Humphrey’s you were referring, but in short would you say the answer should be buying? Since you mentioned that decided to buy one? Thanks!

I learned my lesson the hard way…29 years old and currently on my fifth car. I financed cars for the passed 12 years and I regret it completely. I was always thinking about how cool I would look but decided to finally wake up and stop spending money on stuff that goes down in value. Switched from a BMW to a 2023 Camry that I got for 29k out the door. Couldn’t be happier and planning on keeping it for at least a decade.

@frescosmalls

Жыл бұрын

Being more concerned about looking poor than actually being poor is one of the most common problems people have. Good on you for snapping out of it and turning things around.

@lfpurpose

Жыл бұрын

You apparently still didn't learn your lesson if you bought a brand new car LOL

@Mogardie

Жыл бұрын

@@lfpurpose facts

@basilman121

Жыл бұрын

2023 Camry Hype train! I got the XSE trim with a few upgrades to the package for 36.5k OTD, but it's my daily commuter and I plan to keep it for 15 years. To those criticizing him for buying new, the used market isn't exactly priced well for the reliable camry. Why would I save 1k on a 2022 Camry with 30k miles on it when I could buy new and do a proper drive train break-in, and know the vehicle maintenance from the start?

@Aikynbreusov

Жыл бұрын

I'm still driving my mom's 2010 Lexus LS460L....runs like new...got all major repairs done under warranty...... my grandma just gave me her 2006 Lexus LX470 that clocked 190,000 on the odometer and it still runs like brand new.... don't think I'm buying anymore car.....

Congrats on the 1 Mill!!! And honestly, this video put into perspective what I could afford at the moment or even in the future, I have been tossing around the idea of getting a newer car than the one I have. But your video shows that I have a bit more to do before I should start to really think about it, so thank you :)

Thanks for a great video. Totally agree on buying a used car. Buying a 3-5 year old vehicle is the best value for your dollar. Im not a fan of financing, but I if I did, I would put down a larger deposit to really minimise the depreciation / resale loss at the time of changing. Some companies like Hyundai give longer warranties so owners can be protected on older cars for longer.

I love how Humphrey gives practical advice on car expenses that can really make a difference in your financial future.

I’m only 19 but I personally think if you can’t afford a car with cash, don’t get it at all. I got a 600$ 2003 saturn sl3 and it works perfect. The main point of a car is travel, yet most people spend thousands extra just to have those extra layers of comfort. If you want to be rich you have to let go of comfort.

@humphrey

Жыл бұрын

Love that mentality but sometimes people do need cars and cant buy them with all cash (especially if its a more expensive vehicle than a $600 saturn) so they take the financing option

@andrermn

Жыл бұрын

@@IrisP989 exactly. investing it into stocks or the S&P makes more sense, but only if you pay little interest rates like yours.

@IrisP989

Жыл бұрын

Ahhh.. so people that want electric vehicles, for example, that cost $60K should just bring cash to the car dealership otherwise they can’t afford the car? We purchased an electric vehicle for various reasons, put more than 20% down, got a great interest rate of 2.49% and are paying the monthly payment without a problem. In the meantime, the money that we could have spent paying it off right away is invested or saved and we get a higher return on investment.

@Tialian

Жыл бұрын

​@IrisPG2438 what you have to consider though is you don't own the car, miss a payment or two and you might wake up to a missing car. Although you might get a better return on investment (which isn't really a guarantee), full ownership gives it's own peace of mind and you don't have to worry about losing important assets during a short term crisis where you can't make the payments.

@IrisP989

Жыл бұрын

I will have full ownership. Does it matter if it’s now or later? I have the full amount that is left to pay in my account. I just prefer using the money for something else. Regarding missing out payments in general, that is why it is important to have an emergency fund of 3 to 6 months. In order to not miss a payment or two and get into that situation.

I somewhat did the 10% rule without knowing. I made 42k last year and got a 2000 camry for 2.5k and put 2k in repairs. It has 185k miles and runs great

@humphrey

Жыл бұрын

Nice!

I bought my 2014 base trim malibu during the peak of car prices in 2021 because i needed a car and inventory was low for a subprime buyer like me. I learned a valuable lesson in financing this car so far and its that once im done paying it off i NEVER want a car payment ever again unless its absolutely necessary(family needs or work needs etc) 😅

New subscriber. First time seeing your video! Brilliant. Thank you.

I make $151k per year, and my car payment is $352 per month. I would never dream of paying $1,000 per month. That's insane.

@RGE_Music

11 ай бұрын

Goals.........................

@richard9799

11 ай бұрын

What do you do for a living?! I work in Healthcare and am trying to get paid a bit more so I can be around 120k a yr

@mytrung

11 ай бұрын

Same here!I felt bad getting a 2023 Honda civic thinking I was over stepping my means. But it is nice to have a car that is reliable now.

@jhonen32629

11 ай бұрын

@@mytrungYesssss. Love me a Honda.

@ScottishTerrorsInLA

11 ай бұрын

Exactly, that chart says $1083 for me and I’m like hell no. Just paid $268/mo for 4 years and it’s so nice to not pay that anymore.

I work in auto finance and it is INSANE how often I see applications where people are looking to finance a car with a payment bigger than their mortgage. Cars are depreciating assets people, and they have never been more expensive then they are right now. That car loan debt has no upsides or chance for return on investment. You are literally throwing your money away when you decide to finance that $80K Silverado with all the options at 84 months. Some people have the disposable income to throw money out the window like that but 95% of people just want a cool truck and are willing to stretch their budget to get it, which is an incredibly stupid move. I personally could afford to finance a vehicle like that---but I absolutely never would. The last car I bought was used, I financed $14K, over 48 months, I paid it off early and I am still driving it. It's 10 years old. If you can avoid financing a car in today's market, by ALL MEANS do so. It is an absolutely terrible time to finance any vehicle.

@adrianomarra7494

10 ай бұрын

That’s what I’m talking about 👏👏👏👏 you will never regret NOT going into debt to buy a car, specially now…

@o0mka

10 ай бұрын

What about option to buy Electric car? For example in Germany I bought financing car 1,97% per year. (Cheap money), in 6 months will get a grant for this car, in 1 year I will sell this car with the minimum loses, basically cost of having this car during the year will be around 3k. That is cheaper then rent a car or leasing.

@JohnD418

10 ай бұрын

These people are probably patting themselves in the back thinking it's pretty great they were able to "afford" this "great" car they wanted. That they could fit the payments in their budget (paycheck). Did not remotely estimate how much money went down the drain once lease is over. Then they need a new one and wonder why they never have money to set aside for retirement. At least a mortage you keep equity.

@write2nick

10 ай бұрын

My thoughts exactly. I wouldn't buy a car if I can't pay it off in 4 years. Also I won't pay more than 1000 a month. For me, buying a second property is absolutely more important than impressing my friends.

@anaccount7923

8 ай бұрын

@@o0mkaElectric cars are boring, there’s no engine noise.

Outstanding. I paid cash for my used car and pocketed all the subsidies from my city & county job. Big relief.

*Humphrey is beyond amazing.* “How to create income flow to afford any car”

@douglaschester2097

2 ай бұрын

Making money is action, keeping money is behavior and Growing money is knowIedge

@douglaschester2097

2 ай бұрын

I am fortunate I made productive decisions that changed my life forever (accumuIated over a MiI) through my finance-mentor. I'm a single parent, bought my house in January and hoping to retire at 52 by next year.

@douglaschester2097

2 ай бұрын

sear ch the name, lf you care

@douglaschester2097

2 ай бұрын

*Rebecca Martin Watson*

@svenoliver6040

2 ай бұрын

l’m amazed to partake on this, lt has rekindled the fire to my goaIs.

My rule now is I pay cash for it, or I don't get it. Amazing how your thinking changes from your 20's to your 40's. Thanks for the great info!

@user-sk7ji5wu5f

Жыл бұрын

⬆️Get in touch with me!..❤

@DarkStryder360

10 ай бұрын

I had that thinking in my 20s. It's the new generation that have finance on tap. When I was younger, people spent £500/1500 on a car, and that was it. Nowadays people think they need to spend £10,000+ for their first car.

It all comes down to not having to keep up with the Joneses... I am currently financing my car, but I made sure to not only buy a used car at the optimal point of the depreciation curve, but also one that I can easily afford (i.e.

@humphrey

Жыл бұрын

yes agreed Spencer

@RedSquirreLx

Жыл бұрын

Porsche 911 holds its value the best. Fyi

@GizmoMaltese

Жыл бұрын

What car did you buy?

Good points. Thank you for speaking about opportunity cost. As a CPA, this is one of my huge pet peeves when people discuss making sound financial decisions. It might feel nice and dandy to own the car up front, but you are forgoing all that potential growth on the free market. I would also say that car loan term length is not really relevant. While yes, you will pay more interest on a depreciating asset, the benefit of more cash in your pocket from month to month is a superior position to be in. If you follow the rule of owning at least 20% of the car up front, the term is irrelevant. Just manage cashflow, and use excess cash to build wealth.

@MaSa-bp5qe

Ай бұрын

I completely agree. The extra cash can be used for investment in to a business, Roth IRA, 401k, etc…

I am a resident of NYC, never needed a car now I have a child and I want to expand my footprint possibly to the suburbs. I own property, save judiciously and I just started shopping for a car and it’s INSANE…. LITERALLY a money pit wealth killer. Even used cars are so inflated now. Thank you for this great video. Super helpful !

@markus8484

10 ай бұрын

Just buy a prius or something similar with Toyota Hybrid. You may spend about 20k for a good used one but it will hold its value good, has ridiculous MPG and has great reliability. Far away from a money pit 😉

@yeltsinhernandez7952

2 ай бұрын

As long as you get a good and reliable old family car there are some good options and also giving the primary maintenance yourself you save aton of money

I had no financial education at all growing up, and absolutely love your content! I just accepted my first job and have been binge watching all your stuff to help, and it has helped me SOOOOOO much. Thank you!

@pewpewtactical5288

Жыл бұрын

Listen to Dave Ramsey as well. His financial teachings will set you up for long term success by being debt free for life and make proper investments to build wealth.

@BaystheBeast

Жыл бұрын

​@@pewpewtactical5288 Dave Ramsey is good but some of his recommendations can sometimes be very old school. I recommend also watching him but make certain you sprinkle in some diversity to hear the pros and cons of other ideas and approaches to financial success.

Awesome video! Lots of great info. Its just amazing how many people get sucked into buying a vehicle they cant really afford because they want what everyone else has or are easily persuaded by the sales person. Nobody wants to be patient and put in the time and work to afford something comfortably. They have to have it right now. And you should definitely have your finances figured out so you know exactly what you can afford, length of term, and monthly payments, insurance, etc before you set foot on a dealership. Otherwise those sales people will shake you dry! Give yourself some wiggle room in case extra unexpected costs come up too. If you figure you can afford max a $25,000 car, start looking at cars that are around $20,000. You may find something you like that is less than the max you were willing to spend and be much happier about your purchase in the long run. Plus there are other things to consider like extended warranties on a used vehicle for instance. Things like that which may not cross your mind when you are budgeting for your car. So a little wiggle room is wise!

Great video! I'm 29 years old and in 2015 when. Turned 20 I bought a Hummer which was a dream car to me and I took out a big car payment and the truck just cost do much to maintenance and repair I was sinking money I should of been saving. I was young and made a mistake it was the first thing I ever bought with my own money. But in 2020 I finished the payments and finally decided to sell it this past January and got just a used 2013 Ford Fusion and pocketed most money from the Hummer. I've been sabing do much more money. Honestly, a car doesn't impresse me as much anymore now I'm a bit older. I would recommend anyone thinking about buying a car they can't really afford is to rethink it, don't make my mistake.

11:32 After watching this, I am not sad! I feel enlightened, AND even more content with my 8 year old car. I'm just a bit annoyed that we aren't taught this earlier in life. Thank you

Sadly, many car manufacturers are not making cars for the average income earner. Following the 25% guideline, a salary of 50k puts you in the 12.5k car price. The cheapest car in the market is the 2022 Chevy Spark at 13.6k

@RoyceFrancis

Жыл бұрын

There are used vehicles less than 12.5k. That’s kinda the point. Don’t buy a brand new car

@Eibarwoman

Жыл бұрын

@@RoyceFrancis That's where the hazards of being post-warranty, questionable reliability, high mileage, electronics issues whether it's sensors or infotainment, etc can all easily turn into big repair bills. They're cheap because either the car's old, unreliable, high mileage, or some combo of the three.

@kindlad6087

Жыл бұрын

@@RoyceFrancis a 12.5 k used vehicle is going to be at least ten years old these days. Better buy a Japanese car and pray. The old normal is gone

@ROVA00

Жыл бұрын

@@Eibarwoman that’s not really true. a 4 year old car with 40-50k miles will not be giving you any problems (let alone expansive ones) for a while, unless you buy a POS car. Cars these days will rarely have problems before 100k miles. This is especially true if you research brand reliability and stick with tried and true Honda/acura, Toyota/Lexus. The only scenario where I would buy a brand new car is if I’m making over $200k/year and if it’s a sports car that is more likely to be abused. My Mercedes c-class was worth $53k when new. I bought it when it was 4 years old and had 54k miles on it for $19k. It looked and even smelled basically brand new and 50k miles and 4 years later, the only thing I’ve had to do is regular maintenance and replace the thermostat housing.

@Eibarwoman

Жыл бұрын

@@ROVA00 The problem is the depreciation from 20K to the affordable to the masses 12K under the guidelines suddenly moves from 4 year old vehicles to a 10 year old vehicle. The market's not exactly behaving rationally and the electronics/infotainment are the least reliable aspect of newer cars.

This completely goes out the window when you’re a car enthusiast, I pay for a car I shouldn’t cause it brings me more joy then almost anything else

@andrewdinh5428

Жыл бұрын

right life is too short to drive boring car. I only make 70k ish a year but I always dreaming to own a Porsche GT3 lol

@roarbahamut9866

Жыл бұрын

Indeed. Most of these type of videos do not aply to people, that have their car as a hobby. If you do not enjoy traveling, buying a house or other traditional money sinks, then a more expensive car is also possible.

@dnegel9546

11 ай бұрын

You say that until you have an emergency then suddenly your pride and joy is for sale at a huge discount because you need the money on the spot. Im a car enthusiast myself but there are always cheap alternatives. Example i want a c8 corvette but instead i bought a C4 corvette that is not running and sitting for about 15yrs. Has mold on the inside and paint is sunbaked. Cost me all of $2,000.00 ❤

@max-zv7sf

11 ай бұрын

I get the draw to cool cars, but ever since i got into motorcycles, expensive cars don't make any kind of sense to me. Get a Yamaha R6, or even a R1, and that will cost a tenth of a performance car and absolutely terrify you with the power, agility and capacity that a (overall reachable) bike can have.

@roarbahamut9866

11 ай бұрын

@@dnegel9546 Im not saying that you should put everything in the car. Its a hobby, so keep your spending in check. Always have an emergency fund etc.

Really appreciate you making this video. Especially since I’m thinking about getting a lease. I did not know about the mileage limit.

Keep up the good work!!! Learned something new from this videos. Subscribed and likes!!!!

When a vehicle payment is as much as a house payment we've hit a new level of idiocy.

@mikezerker6925

11 ай бұрын

My monthly mortgage used to be $976 per month! Some people are paying way over that for a car!! Mind blowing!

@looncraz

11 ай бұрын

I care far less about losing a car than I do my home... as such I didn't buy anywhere near the home mortgage brokers, realtors, etc, wanted me to buy. To me, $200k on a home was already alot - I want to be able to pay the payments using passive/guaranteed income for years to come if it came down to it. In contrast, let's say I'm sick... well... I don't need a car, I can sell one or both of them, recoup most or all what's owed on them, and be done with it easily... doing that with a house is more time consuming - and I have to move, which is a hassle in and of itself (and far more expensive than the beating I might take on a $70k car). Thankfully, the used car market is stupid and my cars are both worth more than what's owed ( in fact, my Volt is probably worth more than I paid for it ). I pay ~7% monthly for my mortgage (all costs included)... I pay nearly double that on car payments. To me, it's just a matter of outflow vs inflow, the distribution isn't terribly important. Considering most people in my income bracket are spending 20%+ of their monthly income on their mortgages and then another 10%+ on their auto loans, I have much more disposable income and more headroom.

@sunburntattic54gamingchann83

11 ай бұрын

Facts my co worker just bought a 100,000 dollar gmc truck traded his truck in 32,500 and is paying a 1100 a month of 84 months that’s wild af

@mikezerker6925

11 ай бұрын

@@looncraz the car market is going to flip really soon with rising interest rates. Your cars may not be worth much in a few months. I have been buying used cars (before this craze started) usually 3 yrs old and after the depreciation makes them cheaper. I currently own a BMW and Lexus, paid ~20K less for each than if they were new.

@looncraz

11 ай бұрын

@@mikezerker6925 I usually buy cars a few years old precisely to skip the major depreciation. Bought my 2018 Volt for $18k in 2021, just as the market started going stupid... market rates for the car had already exceeded $20k but CarMax hadn't updated their pricing, making them the cheapest by a mile. Managed a 0% loan for that purchase, which shocked me... no extras or anything. I did buy a new 2019 Volvo XC90 T8 Inscription, but that was mostly forced by the high cost of (and lack of available) used models, the $7500 tax credit making it cheaper, and a few other factors that made going new the smarter choice. That was $1400/mo in payments for a few years :eek: I keep my cars until they fall apart or reach about 200k miles, sometimes a bit more, so I have a good 4~5 years before I really care about the used market, but both cars will be long paid off before that happens.

I’m in car sales and I do have to say . Good luck if you use this for shopping. Even at a franchise dealership during this time finding a $14,000 is very hard. With inflation and most manufacturers behind still from Covid, used car prices are high . So a $14k car will either cost more money long term to maintain also if the mileage is high then your bank is going to give you a higher rate they don’t care if your an 800 score they care about the year and mileage and resale value. So if your trying to find a budget car your car payment may be lower on a new car for the same term. To the buyers it make way more sense to buy something that’s newer and less interest rate .

@tailedbeast7829

Жыл бұрын

Thats why people shouldn’t finance cars at all. Someone who make 50k a year after tax shouldn’t finance. Just save up and buy the car at around 20k. You get almost everything which isn’t older then 4 years and hasn’t more then 70k miles on it. But that what you people at car dealerships wouldn’t sugguest the average joe ever.

@Yeti.1669

Жыл бұрын

@@tailedbeast7829 if someone can live rent/mortgage free it would be easier to do to save $20k but in today’s economy it’s hard to just save up money like that.

@dennislippert8875

Жыл бұрын

@@tailedbeast7829 Have you looked? $20k won't even get you into a 4-year-old Civic right now, let alone "almost everything"... prices are sky high. Almost any four-year-old used car is priced within $5k of it's original MSRP. On the plus side, mileages are generally LOW due to the pandemic. I bought my 2006 car for $10K in 2014.. and the same car (with the same mileage) would command every bit of that today.

@spectac1

11 ай бұрын

@@tailedbeast7829 with how people drive these days, I never will buy a car that already has 70k miles on it. I'll spend a little more.

@jasonhurdlow6607

11 ай бұрын

Not hard to do at all. Just buy an older car that has good reliability (like a Toyota), do proper maintenance, and your own repairs when possible. Buy from a private seller, so you're not throwing money away at a dealer. In fact you really never need to spend even as much as 14k. People significantly overspend on cars. Quit caring what your neighbors think.

Great video! Love the breakdown and very sensible advice. Thanks Humphrey!

Returning to the States soon, so I'll be needing to buy a car. Thank you for the very helpful guidelines!

I make 100K/year and have an 05 Hyundai Tiburon and ive been driving it forever. Ive been trying to stay discplined and not get my 65K dream car.

@payne7761

11 ай бұрын

I net 80-100k a year and drive a newer jeep I paid 28k for but I keep a 93 ford escort as backup lol. Love that little ford.

@awesomemusic3882

11 ай бұрын

Similar story here, stay strong LOL. Nice cars a money pits.

@xMontorix

11 ай бұрын

@@awesomemusic3882 Thank you! I needed thos.

@MuzMovMix

5 күн бұрын

how miles do you have on your Hyundai?

Thanks for the informative video i’m just getting into buying my first car and few days ago i decided not to buy a car that’ll keep me shackled in debt just to impress people who don’t care, and i would like to add that people should look for reliable well known brands with cheap car parts because people can get fooled easily into buying unreliable cheap cars that will be a nightmare for them it would’ve been better if they bought that expensive car they wanted

You make valid points, for someone who doesn’t own their home and has other debts. What about an home owner with no mortgage, no debts, maxed out 401k and Roth?

I just paid off my 2018 Honda Fit I got in 2019. My interest rate was low for picking a car 1-year behind at the time and was paying around 225/month at 75K/yr. I'm happy I can finally have no monthly payment, hopefully this thing lasts a long time. I've had it about 5.5 years and it's almost 40K miles. I work from home, so I'm hoping it lasts longer than usual.

Solid advice. The addition of Edmunds cost to own calculator is terrific as it includes the higher cost of insurance for newer vehicles and maintenance for used vehicles as well as fuel if considering a hybrid or EV.

It’s tough because the 35% rule and the 10% rule equate to very different cars you can buy too. I got a car right out of school that’s total worth was nearly half my starting income but the monthly payment was only about 11 or 12% and at that time still lived with my parents and could afford a payment like that since I didn’t have any massive other expenses. Could I have gotten a way cheaper car? Absolutely. But looking back I’m so happy because I got a car I loved, while it was pricey I could still afford it, and 4 years later the car is paid off and I should continue to have reliable transportation and a car I’m very happy with for a minimum of 7 or 8 more years hopefully. It’s hard to follow a specific rule when situations always very so drastically person to person

@pawrestlingchamp

9 ай бұрын

You're situation is different because you didn't have to pay for rent or a mortgage which is the biggest monthly expense for the vast majority of people. It still wasn't a good idea, but it is far more manageable.

@dakotakavana

9 ай бұрын

@@moonlit85I’m 20 and want to start investing. I’m thinking of financing a car and investing at the same time to accumulate more profit than the total that there is to pay off.

@Deimian676

8 ай бұрын

Lol your circumstances isn’t common, and it’s an outlier .

@DsgSleazy

7 ай бұрын

@@Deimian676Living with your parents in your 20s is extremely common, I’d argue people in their early 20s and even maybe mid 20s living on their own (this includes living without a roommate) are the outliers.

@Deimian676

7 ай бұрын

@@DsgSleazy got ya!

The other problem with getting a car that you can afford, which is usually a higher mileage, older car if you don't know how much it's gonna cost to fix it, I mean, at least with a newer when you have a warranty and you can save up for things, but if a fuel pump breaks the transmission engine brakes it's on you and that's thousands of dollars

We are still paying on our family car but the older two hatchbacks have been paid off for a long time. Its a good feeling when you get to no more loan. The third car, a 2014 Focus needed a bunch of work on the suspension due to rust, and other issues. I paid the $2700 because I examined the cost of a replacement and figured it will probably last a few more years. Having the third car has been a great luxury because it’s a spare and we can lend it out when family or friends need to borrow it.

Congrats on 1 million subscribers Humphreys. You deserve it. Been watching you for long time and i love your channel. Keep up the good work

One thing I learned too is buying a used/certified pre owned with good mileage is just as good. You also don’t get the big depreciation up front

The depreciation rule for new cars used to be true, but not during times like this with insane inflation rates. The CX-5 I bought 2 years ago and drove 20k miles on is worth more now than when it was new. Also, I could have bought it outright with cash, but it was 0% APR. It was smarter to get the loan and pay it off over the maximum 5 years they allowed for me.

Concise and succinct with just the right amount of illustrations

When I was 18, I bought a brand new car off the lot. It cost 100% of my annual income. I made the decision because I didn't want to deal with a hunk of junk that someone else had abused. Practically zero maintenance, and fuel efficient. I'm turning 30 next month and it remains the only car I've ever bought. It's been paid off for six years. It's one of the best decisions I've ever made.

@snc237

Жыл бұрын

You were 18 probably still living at home. Try that when you 30. Not going to happen lol

@user-sk7ji5wu5f

Жыл бұрын

⬆️Get in touch with me!.❤

@Xyz_Litty

11 ай бұрын

@@snc237 You should be making twice or triple the money you’ve been making at 18 when 30 ..

@kiresedivaneb

10 ай бұрын

What a comment. What did you eat? Did you live in the car? Are you understating your income because other people were paying your expenses when you were 18?

@DarkStryder360

10 ай бұрын

Sounds like you're not interested in cars. But wasting your money in your early years for a chunk of metal and plastic? Why?

Do yourself a favour, and do either of the following: 1. Buy a decent, safe, reliable, and cheap (under $10,000) car (e.g., Accord, Camry, Corolla, Civic) that is ~10 years old and run it till it’s dead. 2. Buy a moderately priced used car ($15,000) that doesn’t depreciate as fast (e.g., Japanese cars) and run it for 5 years and sell it for $7-10,000 afterwards. Currently driving a 2009 CRV that I bought for $6,000. It’s absolutely perfect. I could drive it for another 5 years if I wanted to but I will probably sell it in a year and get something newer like a 2012-15 4Runner

@NPC10912

11 ай бұрын

All the models you listed have gone up the most in price both in New and used market.

Great video! Only thing I would add for clarity and this may be different in the US as im UK based, but the interest you pay is front loaded on the agreements. At the begining of an agreement the majority of your monthly is pure interest. If you were to get into trouble on one of those longer agreements have less that 50% equity even after 3 years of a 5 year agreement as an example. Additionally if someone took a longer payment plan and decides to pay it early say takes 5 year over 3 year but pays off at 3 years they still would have wasted money on the extra interest.

@spacetoast7783

9 ай бұрын

It's the same in the US

Loved it. Very informative video. Gave me new perspective on car buying. ❤

Sometimes it's also about why you need the car for. We got a new car last year because we drive all around the US for work on a regular basis. It wasn't smart financially but the life improvement it created is worth it. Obviously it wasn't the financially smart thing to do and that's not what your channel is about, but I also wanted to express that sometimes when you buy a car you also buy much more and if you're willing to pay for it, it might also be worth it in some way.

@06Triple

Жыл бұрын

He just speaks in general guidelines, and it's not bad advice for the vast majority. I own my business, and bought a more expensive truck. It's my office, and I spend more hrs driving a week, then many work. I also spent more for a new venture that I can rent out trailers, actually paying for my trailers and truck payment. That doesn't include the tax incentives for businesses. Breaking down to that level is just not very feasible. At the end of the day, sometimes, a car can be your enjoyment. Some people go to the bar, the movies, or put that money into their vehicle.

@trenegade5441

Жыл бұрын

​@Steve Hope while I agree with everything you said it's apples and oranges to compare a vehicle bought for a business than a personal vehicle. They are two completely different propositions.

I had to buy a car after mine got totaled, after having just paid it off😭 Because it was the time when used cars were going for more than new cars it made sense for me to get a brand new car. I make just over 50K and my car payment is $326. Might be more than the rule suggestions but overall happy with my decision(plus the insurance payout was greater if I went with new than used🤷‍♂️)

I recently bouth a car for one month net salary. And it serves me well. Takes me wherever I want and that is the point. The seller though the car is in worse contition and it actualy wasn´t. Hopefully will serve me next 2-4 year, so I can save up for some better car. Thanks for the video! Reminds me a good decision of mine.

Well, one thing is that saving money makes one be able to buy a more expensive car. I also think money is meant to be used, so while it's important to buy other things than a car, in the long run we all die so it's not necessarily a bad choice to buy an enjoyable car. It's just more important to avoid debt in general.

Soon our boy gets 1 million subs, congrats have been around a while, your channel is nuts and you are great! have a great hump🦄

@humphrey

Жыл бұрын

thank you Nerdhut! appreciate it

@noreenn6976

Жыл бұрын

​@@humphrey does YT give you anything special when you hit 1M subs?

This was very helpful, and well laid out. It's nice to know that my budget is on point when compared to my desired car and my income. Buying a car is a large move, especially for thoes of us in our 20's.

I had my last car payment in 1973 on a Buick Century. I drove it for five years and only bought cash ever after. Last year I sold a Tacoma and a Corolla (my wife can no longer drive) privately and bought a 2018 Rav 4 CASH of course.

I bought a used Mitsubishi Space Star for less than 10k$ cash. Sure, sometimes I wish to have a car that's a bit flashier, but it gets me from A to B and was probably one of the more responsible decisions I made in my life. My anual gross salary is around 80k$, so theoretically I could maybe afford more, but to me it doesn't really make sense to spend that much on a car, because you will be stuck in traffic for the same amount of time (at least where I live).

@Smoove_J

5 ай бұрын

Seriously, I’ve never been impressed by flashy cars. As long as it’s clean and fully functional it’s fine with me.

@johnnygonzales3267

4 ай бұрын

You guys aren't just buying a brand. Safety features are way better on cars that cost more. 5 star crash safety 10 yrs ago now would be a 1 star.

Me: This should be helpful! *lowest example is $40K/year* Me: Frick my life.

@cyberdefault

11 ай бұрын

If you can, ware house jobs can usually get you well over 40k a year , tho it’s tough work

@bosshoss6640

11 ай бұрын

​@@cyberdefaultyes you can. But still can't afford Anything. Only 3 or 4 cars under 25k new I think it was.

@cyberdefault

11 ай бұрын

@@bosshoss6640 the whole point of the video I feel is not to buy a new car especially on a salary under 80k

@Doktorfailgaming

11 ай бұрын

@@cyberdefaultnot in Germany, I have a quite good paying IT job and I am far away from making 40k€/y after taxes…

@Doktorfailgaming

11 ай бұрын

@@bosshoss6640welcome to Germany where a basic Ford Focus kosts u way over 30k€

I'm still driving my old 1999 Toyota Tacoma. 4 wheel drive, standard/manual shift, and basically analog. No power windows or anything. Pros: Easy to repair and it does have AC. Cons: Underpowered with only a 4-cylinder motor.

@jonathanwhiteacre7046

11 ай бұрын

99 Land Cruiser here. I'm a little tall for the tacoma and need to fit the car seats or I might have one instead. Love the manual

@RossGoneRogue

10 ай бұрын

Unless you own a hauling business or own horses there's no need to have a big displacement pickup. Your Tacoma can do 99% of the activities a V8 full sized pickup can do and will last longer too.

My first job started at 57K in tech and I got a new Toyota Corolla 2021 LE model with a monthly car payment of $350.41 for a five year term at the end of 2020, a buddy of mine also working in tech got the highest trim of the Honda Touring sports model (also at the end of 2020) and ironically was making around 80K with a car payment of $666/month for a five year term as well. The irony of the closeness of those numbers to your chart is so on point. 🤣😂

I’m so glad that I’m into old Japanese enthusiast cars and just fix them up. Cheapest way to be a car guy ever.

It’s interesting to see this numbers and put them in other markets’ perspective, for example here in Brazil following the 35% rule, only the 1% would be able to afford the officially cheapest new car sold in our market.

@darkshadowrule2952

7 ай бұрын

You'd have to be pretty damn upper middle class here in the US right now, minimum of a new car you can insure is realistically 25k+, everything else is either impossible to find or like with Kia, insurance companies either charge through the roof or won't accept them because they're easy to steal

@Dbb27

6 ай бұрын

Then don’t buy a new car.

@darkshadowrule2952

6 ай бұрын

@@Dbb27 if only one percent of people buy new cars how are there supposed to be enough used cars for the other 99 percent? Use half a braincell

Hey. Here in Brazil you pay 1.92% interest per month with a good credit score. If the car is used, the interest increases. It's brutal to live with an environment of high rates.

I needed this vid to humble me. Thank you 🙏

Almost 60 yrs old here, great advice. I try to buy second hand as much as possible. But with a 25% limit methodology....not much options for a guy who likes sedans with comfy seats for my skinny butt.

I have a 2012 Honda Fit. I bought it new in cash. I drive approximately 52 miles per day for work plus vacation mileages. I have 193,890K miles so far. It’s been a great vehicle. Praying it’ll drive until 400K miles!!

I am a car enthusiast . A lot of my passion and ambition comes from the deep desire to own expensive sports cars. At the same time I live a very financially sound lifestyle with investing and saving. The key is balance when it comes to needs and wants. If you want to own expensive cars you need to make cuts in other areas. I do not buy expensive clothes, housing, go on vacation or have kids. I have had friends shocked at how much I pay in fixed car payments but their travel, childcare, and home cost far exceed my car cost. Its all about the bigger picture when it comes to how much you want or can spend on a car.

@ROVA00

Жыл бұрын

I’m right there with you. I’m seeing that even making a little over $100k I still can’t really afford a civic type R.

@YuShawStang

Жыл бұрын

@@ROVA00 You could buy a Civic Si 7 gen easily, haha. I think driving certain inepensive cars can show having a good tastee too; I drove a 05 Mustang GT to the work once and my boss asked me "is it manual or automatic ?" On the other hand, my assistant manager drove his AT WRX to work and evey colleague and male customers were teasing at him.

@ROVA00

Жыл бұрын

@@YuShawStang yeah but a civic SI just wouldn’t do it for me anymore. My last car was a built 2006 STI and it would have to be an upgrade for me to consider spending much over $40k :-( sad times

@YuShawStang

Жыл бұрын

@@ROVA00 For Cost/Performance perspective, CIvic Type R is not a good choice

@ROVA00

Жыл бұрын

@@YuShawStang not with the markups, no. But at $43k I think it’s a fantastic value. The type R is a track weapon and handle like fighter jets. Has four doors and enough cargo space to make it a livable daily that I could take on a trip. I can’t think of many cars for the price that have all of that going for it while also having Honda reliability. The Golf R is kind of close but I’ve driven them and they are a bit bland and VW has terrible reliability after the warranty period ends.

More people need to watch this. I have friends who have 1k-2k car payments and make less than 30k a year. its wild

@_Martine_

3 ай бұрын

Are you for real?? 😳

10% rule is one of the best I´ve heard about owning a car so far. I calculated my budget and turned out I could afford a car I want. I earn 45k a year and has always thought it was too much money owning a car. Turned out I was on 5-7% budget but 10% sounds good and fair. Never thought about thinking in % of your budget before.

@chiefhere1968

10 ай бұрын

and what is the car that you wanted?

@catha86

10 ай бұрын

@@chiefhere1968 I have many choices but the one thing I´m more into is the toyota corolla 2019/2020 executive model hybrid. Its almost like a new car and a car I can keep for 6-7 years+ with no problem. 184HP. Nothing super fancy but a reliable car for many years

@ps3beatswii

10 ай бұрын

Toyotas are a safe investment, and won't depreciate anywhere near as much as other makes. Sadly, dealers are well aware of this and jack up the prices of their artificially limited inventory.

@chiefhere1968

10 ай бұрын

@@catha86 wise choice brother. Hope it treats you right. :) I am prolly gonna risk it for the biscuit. Have my eyes set on a 2014 benz c300/350 but let's see if I actually go thru with it.

@liljoe23la

10 ай бұрын

@@ps3beatswiiToyota lost all of my respect. 😡 They are purposely limiting production to make profit. Dealerships are marking up the prices so high, even for base trims

I bought a 2015 Honda Accord and paid in full. It was a sacrifice putting that much money away in savings but the freedom and peace I have knowing my car is fully paid for is priceless!

Your videos are great! I wanted to add my scenario for conversation. I had to get a car back in December of 2021. I remember being so annoyed at the timing because of what the market was like. I ended up getting a 2018 Honda CRV with some features that were essential to me because we move often and drive long distances. Given the timing, I think I got a pretty good deal on the car. I also got a 2% interest rate for my 5 year loan. And I put no down payment on the car. It was a little over 25% for me. I know I broke the rules but I don’t think I would have done it differently. 2% is so nice with great chances to out perform in the markets. And instead of doing the down payment on the used car, I invested that as well. Although I’m lucky to have gotten that rate. If I had a higher rate, I would feel differently.

@97I30T

10 ай бұрын

I actually agree with you. If you can get a really low interest rate, pay that car off as slowly as they'll let you. You're basically getting paid to borrow other's people money when you use a low interest rate to your advantage and let your own money out-earn the low interest rate for borrowing. Let other people's money work for you whenever you can.

New to the channel - great advice on here!

Damn, I love efficient videos. Well done!

This all worked pretty well until the past few years. The average price of a new car is something like $47k. So the usual answer to getting around high new car prices is to buy used. Well used cars aren't cheap like they used to be. I keep waiting for a halfway decent car that is 3-5 years old to fall within my budget and it isn't happening. Thankfully, I have a very reliable 12-year old Acura and I can try and wait this out.

@NooDLES411911

10 ай бұрын

It will happen. I see soooo many used cars in lots right now and it'll get to the point where they are forced to sell them cheaper.

@RossGoneRogue

10 ай бұрын

Happened to me pre-pandemic when I bought a truck. I was looking at 2-3 year old ones on the lot that were only listed about 3-5k lower than the new models and they had an average of maybe 50-60k miles on them. When you buy used you usually don't get any of the dealer benefits so when I pulled the trigger I got a bunch of GM cash, money for having good credit, some other 'sales marathon' thing and spent less than $1k more on a new truck with 7 miles on it than a used with mileage already on it. The dealer incentives kinda ruin that "buy 2-3 year old vehicle" rule sometimes.

@norwegianblue2017

10 ай бұрын

@@RossGoneRogue I have literally seen the used version (30k-45k miles) of a car I was looking at for the same price as it is new within a two hour drive. When I bought my Acura in 2013, it was 2 years old with 18k miles and it was $13k off of the MSRP price.

@RossGoneRogue

10 ай бұрын

@@norwegianblue2017 those days are long gone I'm afraid

@ted9592

9 ай бұрын

Yep...I am still driving my old pontiac waiting for the market to get under control. I have been waiting for 2 years.

great vid with concise info. great timing too been looking at buying a car the past couple months haha

Thank you for the video. Thankfully, my wife and I are debt free as of a year ago. House we just paid off a year ago, our two cars are paid off 2011 Lexus ISF and 2020 Toyota Highlander. Looking at the prices of vehicles now and the financial insanity of paying it off now, it makes no sense to look for new vehicles.

Interesting video. It’s also just a starting point. Once you factor in other expenses its probably much less. My car note is less than that ($80k) but because of how expensive housing is around me $600 would be too much.

Good video and can’t say I followed all the advice! One minor point though - the opportunity cost section should reflect the difference in the investment income vs the cost of financing. It can only make sense if the cost of financing is less than 10% in your example and should factor in that the financing is guaranteed while investment returns are not. This opportunity cost certainly looks different with current interest rates than it would have a couple of years ago.

Best financial advice I ever received from my father regarding car buying-- 1-save enough to pay cash. 2-if you must finance - nothing more than 36 months. If you finance longer than 36 months, you’re buying a car you can’t afford. Retired 18 months ago and still drive the SUV I paid cash for 23 years ago.

@StEvEn420BrUlE

10 ай бұрын

That is really bad advice

@92miata

6 ай бұрын

paying cash means no interest and no need to worry about the interest rate.@@StEvEn420BrUlE

@craigjones4810

6 ай бұрын

I laugh when people brag about owning vehicles for 20 plus years. Try doing that in the northeast.

@liddlebopeep

6 ай бұрын

Dealers now charge higher price for cash purchases than if you finance.

@mikepawlikguitar

6 ай бұрын

Congratulations. Do you want a star on your fridge for your effort? Did you live and love life to the fullest and are you happy? If so, you did it right.

I live in Malaysia, and yes, cars are very expensive here. Minimum wage is RM18K/year ($3850~), while the current cheapest new car in the market is RM22K ($4700~), and thats a very barebone car, you dont even get a radio. It is very common to stretch the loan term to 9 years

I haven't had a car payment in years. I keep two older cars fully maintained at all times. One pretty nice truck for truck tasks only, and one fairly fuel efficient sports car that i daily drive and have loads of fun with. Even if the cars start breaking down, at least one vehicle is always running good. I also learned to wrench on my own stuff. Started out with an oil change and then realized a brake job isnt all that difficult. Now i can even replace my own transmission and rebuild heads When you have a spare vehicle you can risk trying stuff yourself and you can risk pushing a car into higher mileage ranges. Buy vehicles with common parts and considerate engineering.

@RogerPack

10 ай бұрын

Do you rebuild your own heads?

@misterbulger

10 ай бұрын

@@RogerPack yeah

@RogerPack

10 ай бұрын

@@misterbulger nice. How long did it take you at first and how long now?

Will definitely be referencing this video when im planning on purchasing my first car. Was really thinking about buying it based on how cool they are. But I keep forgetting they are a depreciating asset.

@matthewgarner8728

11 ай бұрын

Not an asset...liability...

The car you can afford is the one you can pay cash for. I saved up and bought my first car at age 23 in cash, it was new and $17k. Although I see that as a smart decision because I never had a payment, it would have been even more wise if I bought a cheaper used car.

@itskelvinn

Жыл бұрын

If interest is low, then it’s not smart to buy in cash Having said that, I’m 25 and still buying the beat up car that my parents got for me in college.

@mjrvi9866

Жыл бұрын

It's very difficult to pay cash for a car usually and there too many places where you can't do anything without a car

@Tialian

Жыл бұрын

@@mjrvi9866 sounds like an excuse really. There are plenty of ways to get around without a car, a car just makes it easier and more convenient.

@XxXK9

Жыл бұрын

That’s great man. I mean, it’s better than paying interest. And paying several thousands more. I mean sure you could’ve gotten something cheaper or even better, getting a $300 bike or something. But why dwell on it. I’m sure you’ve already made the 17k back by now.

@DysyR

Жыл бұрын

i got my car for 0.99% rate and at the time my savings account was a 0.5% rate did make sense to cash a car when my rate was .049% essentially. now my savings rate is 3.25%. so it makes even less sense for my to pay off my car. so it depends on the situation of course

This surprised me. I'm in Canada an I financed a Subaru Crosstrek in 2019 at 1.9%. My monthly payment is about $430/month over 60 months (I have 22 payments left I think). Given a salary, at the time, of about $105k I guess I'm well under what I can afford. I immediately started putting away $50/pay for repairs and of course the next car. Next year when it's paid off, that will be upped to $250 (make the same payment, just to myself now). I plan to drive it until at least 2029, at which point I expect to have about $40k as a down payment for the next one...