Car Payments

[Narragansett]

In the second quarter of 2024, the average new car loan was 734/month and the average used car was 525. Duration was 68 months. That is the average, I bet the average truck or big SUV loan is over a thousand.

Where does the money come from? Jeepers

Edit: The average truck payment is 913. Loans as long as 96 months.

 

[DWalt]

Nothing beats paying interest on a rapidly depreciating asset. That’s why I drive a 21-YO pickup.

 

[Skeet 028]

I am going to buy another vehicle soon. Car or truck? I don't know yet. I just consolidated a few accounts in different banks. I put the money in an account and I will borrow the money from that as a collateral loan...It will cost me 1 3/4 percent more than I receive on the deposit. Still make payments...but not to a car company. If I buy a truck I'll probably get one from Hertz car sales...they have some good deals usually

 

[Bald1]

Yeah it’s funny. When I bought my new F250 16 months ago I wondered how people pay for these $80k trucks I see on the lot. In 1991 my first house was $78k. I’d be willing to bet many people have auto payments higher than their mortgage……… or like some dim witted co-workers I used to have they don’t own a house because of their truck payment.

 

[Denverd0n]

96 months!!??!! That's just insane. I suppose that if it is being bought by a business, there might be tax/expense issues that make it logical. If you are an individual, though, buying a personal vehicle, and you can't afford it without an eight year loan, then YOU CAN'T AFFORD IT!

 

[Oldengineer]

When I was working in the auto/truck business the useful life was thought to be 7 years and 120,000 miles. At that time a 5 year/60 month loan was thought to be excessive! BTW, I retired in 2006.

Tom H.

 

[twodog max]

I used to could have shown you a single wide trailer that looked like a dump, a raggedy truck in the yard hooked up to a $80,000.00 bass boat. Now right there is the definition of stupid. No it was not me.

 

[03hemi]

I only buy used and pay cash.

 

[Chuck24]

My first new car in 1975, payment was 94.57 for a Ford Granada, 36 months

 

[Doug M.]

The first big problem I see is that a lot of folks choose their vehicles based on "want", not "need". We tend to select vehicles based on prediction of what the vehicle has to do for my life and perceived quality for the $$, pay them off fast as we can, and then run them for as long as possible. That usually means several years and many miles.

I have had two Ford Focuses. The first was getting up there and got damaged by the dealer during service. The second (good deal by embarrassed dealer) had 150+K (no longer recall); sold it to a friend for his son when I bought my First Subaru. That 2nd Focus had over 200K on it with no real issues when it was totaled by another driver' stupidity.

My wife bought her first Subaru and beat the tar out of it (too many in town miles and that was before they fixed the head gasket issue) for 7 years. She replaced it with a different Subaru in 2018. My first Legacy was hard to get (6 speed manual) and got very high mileage (oil change a month for quite a while). My Ascent was bought with the goal of transporting two crated Rotts (all of our cars were bought considering dog transport).

We don't buy models with too much fancy stuff as a rule, unless it serves some purpose. We are working on building a Super C RV and we are spending a lot less for the level of quality we will get. Most RVs under $2M have serious QA/QC problems. Ours will be well under $1M even though it is custom (special order Western Star platform, custom design, no propane or slides. Our needs are specific - two of us, no likelihood of guests, dog friendly. As I will be immunocompromised after transplant, flying and hotels are no-gos.

 

[rockquarry]

The first big problem I see is that a lot of folks choose their vehicles based on "want", not "need". We tend to select vehicles based on prediction of what the vehicle has to do for my life and perceived quality for the $$, pay them off fast as we can, and then run them for as long as possible. The usually means several years and many miles.

I have had two Ford Focus. The first was getting up there and got damaged by the dealer during service. The second (good deal by embarrassed dealer) had 150+K (no longer recall); sold it to a friend for his son when I bought my First Subaru. That 2nd Focus had over 200K on it with no real issues when it was totaled by another driver' stupidity.

My wife bought her first Subaru and beat the tar out of it (too many in town miles and that was before they fixed the head gasket issue) for 7 years. She replaced it with a different Subaru in 2018. My first Legacy was hard to get (6 speed manual) and got very high mileage (oil change a month for quite a while). My Ascent was bought with the goal of transporting two crated Rotts (all of our cars were bought considering dog transport).

We don't buy models with too much fancy stuff as a rule, unless it serves some purpose. We are working on building a Super C RV and we are spending a lot less for the level of quality we will get. Most RVs under $2M have serious QA/QC problems. Ours will be well under $1M even though it is custom (special order Western Star platform, custom design, no propane or slides. Our needs are specific - two us, no likelihood of guests, dog friendly. As I will be immunocompromised after transplant, flying and hotels are no-gos.

1.Pay cash. There are many advantages to paying cash, one of which is that you are less likely to buy something with many features you don't need.

2.Only buy vehicles that retain value well. A cheaper vehicle may not be worth much at sale or trade time and may be hard to get rid of.

3.Drive them at least six or eight years.

4.I always buy new, but buying used is fine, whatever you can afford. I know all about how a vehicle depreciates an incredible amount when you drive off the lot, etc., but new is worth it to some of us.

 

[Narragansett]

from DougM

"I have had two Ford Focus."

You have one Focus, 2 Focii

 

[Narragansett]

96 months!!??!! That's just insane. I suppose that if it is being bought by a business, there might be tax/expense issues that make it logical. If you are an individual, though, buying a personal vehicle, and you can't afford it without an eight year loan, then YOU CAN'T AFFORD IT!

I believe vehicles to businesses are on accelerated depreciation over a 3 year period

 

[Ivan the Butcher]

I traded in my 2000 4x4 Silverado (278K Miles on odometer but most likely 325K miles) 2021 (2 days after Covid lock down was lifted) for a 2014 lifted 4x4 Silverado with 128Kmiles. I'm now at 138K. I am thinking this is the last real truck for my lifetime! Last tank of gas was 13.5 MPG. That's good for how it is accessorized. I'm used to 9-12mpg for the last 50 years!

I see the kids (30 to 55year-olds) in the condo complex around me, and wonder how they afford a $300K condo, a $80 K car (or 2), and many have College debt. The ones that don't get divorced usually have 2 incomes, the ones that do divorce have much less!

This complex is mostly child free. We had 4 kids, She stayed home for the first 15 years and part time until the last was on his own. I always worked 2 to 3 jobs! I don't see any of these people working more than one job. Makes me wonder what kind of debt they are accumulating?

Ivan

 

[Onomea]

I used to could have shown you a single wide trailer that looked like a dump, a raggedy truck in the yard hooked up to a $80,000.00 bass boat. Now right there is the definition of stupid. No it was not me.

Or, priorities. (Not that I am saying his priorities are mine, by any means...)

 

[rockquarry]

I traded in my 2000 4x4 Silverado (278K Miles on odometer but most likely 325K miles) 2021 (2 days after Covid lock down was lifted) for a 2014 lifted 4x4 Silverado with 128Kmiles. I'm now at 138K. I am thinking this is the last real truck for my lifetime! Last tank of gas was 13.5 MPG. That's good for how it is accessorized. I'm used to 9-12mpg for the last 50 years!

I see the kids (30 to 55year-olds) in the condo complex around me, and wonder how they afford a $300K condo, a $80 K car (or 2), and many have College debt. The ones that don't get divorced usually have 2 incomes, the ones that do divorce have much less!

This complex is mostly child free. We had 4 kids, She stayed home for the first 15 years and part time until the last was on his own. I always worked 2 to 3 jobs! I don't see any of these people working more than one job. Makes me wonder what kind of debt they are accumulating?

Ivan

Debt apparently doesn't bother a lot of people these days.

 

[SMSgt]

Debt apparently doesn't bother a lot of people these days.

The economy depends on it.

 

[dmn57]

Yeah, it's crazy. Sticker on the last vehicle we bought was more than our first house. Fortunately we got the deal of the century - for us anyway - and were able to pay cash for it. Even worse is real estate in our area. $600K+ houses can't be built fast enough. Who the heck is buying them? I agree the current generation seems to be much more comfortable with a huge debt load than we ever were.

 

[paplinker]

To me the biggest change to the auto market is that now days you really can't work on your own car anymore and most parts are incredibly expensive. This leads to many people being afraid to own a used auto for a long period of time. I drive a 2009 GMC Sierra and I can't do much more than change a sensor.

It's due for brake lines and hoses and my garage guy is saying to expect $3500+ likely before all is said and done.

It's almost worth it to consider a 3-4 year trade in plan with the high resale values.

If I could work on my own truck I would keep it another 15 years.
Back in the 70-80s I could.

 

[Bald1]

The first big problem I see is that a lot of folks choose their vehicles based on "want", not "need". We tend to select vehicles based on prediction of what the vehicle has to do for my life and perceived quality for the $$, pay them off fast as we can, and then run them for as long as possible. The usually means several years and many miles.

I have had two Ford Focus. The first was getting up there and got damaged by the dealer during service. The second (good deal by embarrassed dealer) had 150+K (no longer recall); sold it to a friend for his son when I bought my First Subaru. That 2nd Focus had over 200K on it with no real issues when it was totaled by another driver' stupidity.

My wife bought her first Subaru and beat the tar out of it (too many in town miles and that was before they fixed the head gasket issue) for 7 years. She replaced it with a different Subaru in 2018. My first Legacy was hard to get (6 speed manual) and got very high mileage (oil change a month for quite a while). My Ascent was bought with the goal of transporting two crated Rotts (all of our cars were bought considering dog transport).

We don't buy models with too much fancy stuff as a rule, unless it serves some purpose. We are working on building a Super C RV and we are spending a lot less for the level of quality we will get. Most RVs under $2M have serious QA/QC problems. Ours will be well under $1M even though it is custom (special order Western Star platform, custom design, no propane or slides. Our needs are specific - two us, no likelihood of guests, dog friendly. As I will be immunocompromised after transplant, flying and hotels are no-gos.

As a retired Teamster with 2 million miles under his belt…….. YOU HAD ME AT WESTERN STAR !!!!!!! Nice