Soli said: You're looking at this from your specific vantage point. There are people that are time-poor but money-rich where a used car (usually with no warranty) won't work out for them as a financial investment. If you have pricer automobile (under warranty) that needs servicing you get much better service which leads to more downtime
II don't have a vehicle that anyone would call cheap by any means but I don't get a white glove service where they'll either send out a mechanic to my house or have the vehicle picked up with a spare brought to my house and my possessions transported to the new vehicle along with all my settings switched. I have to drop it off myself, what for them to drop me back home or get a ride, and then wait for them to call me. And that's under warranty… and I'm doing that this week for a rattle on a 2019 vehicle
If I had bought an older vehicle I'd have to find a service service and then pay out of pocket. I'd rather not waste my time with that. I can't even work on modern vehicles. I also have an old, pre-computer, off-road vehicle that mostly sits but it does run. I can repair everything on that truck because it's simple. I can mostly picture every part of that vehicle, including the bolts holding it together. That's never going to be the case with my current vehicle… and I have extensive knowledge of automobiles. If I were someone with no automotive experience but wanted the most reliable vehicle then a bumper-to-bumper under warranty for 3 to 5 years wouldn't be a hard sell. That peace of mind is also an investment.
Yes, I agree to some extent. If you can't have any down-time, and you pick the right brands... maybe you'll do better with brand-new and keeping in that brand-new state by buying (probably leasing) every few years. But, I think at that point we're more talking about high-end business customers who aren't really doing what they do for best financial practice reasons.
Plus, a 2 or 3 year old car is still often under warranty for a while, so you could buy those and then buy a newer one in a few years again... to keep under warranty. You can also certainly (and they'll welcome it) take a used car to the brand-dealer it comes from. I just usually pick 3rd party shops to save money (and sometimes get better service, too). But, they don't often have the 'perks' of the dealership, especially at the higher end.
I also can't work on newer cars as well anymore, though I don't have a good place to do it (nor the tools) anyway.
The only real financial downside I can think of, is that the insurance company doesn't properly value a well-maintained vehicle. So, for example, if someone crashes into me, the insurance is just going to give me the book value of my vehicle... even if I've replaced several of the crucial parts that would have kept it on the road for another decade. So, in that sense, I could lose money under that circumstance.
nht said: A 10% drop is large but 5% went up and 5% went down and 52% isn't "eradicated".
I think the problem is more that 'middle class' has changed, along with the issues some people face now. Some of these things are kind of self-imposed, I suppose, but other are not.
nht said: You have to have capital to invest and higher rates of return incurs higher risk. Which is why most of those "cheap" loans are secured by physical objects like your house or car. The risk to lender is lower.
Can you take a low interest mortgage and invest the difference? Yep. Could you do that in 2007 and not lose your house in 2008 if you also took a big hit on income? Ask the families that owned houses lost to foreclosure.
Exactly! Hindsight is always 20/20 for this kind of thing, and the people who play and win love to talk about how they won. But, we probably don't hear so much from all the people who lost.
nht said: It's not like they are going to give you 10 years at 0%.
Some of the car companies were going fairly long on the 0% interest, though not nearly that long.
I am so sick of 1950's technology for payments in the US! In China everyone uses contactless payments for everything (however you must have a Chinese bank for tourists to use them). The signature verification was used starting in 1950's as a way to verify the holder of a credit card was the owner! It was the only technology available at the time, the merchant was supposed to compare the payment signature with the one on the credit card! I have been using credit cards for 50 years and have never seen anyone compare the signatures, its useless. Apple Pay is the future and I am glad to see the Apple Pay/Card as it is the most secure system. In my opinion whats needed is for Apple to aggressively market Apple Pay to restaurants. In restaurants the waiter takes your card and disappears to do the payment, it is VERY INSECURE, they can take photos of your card in seconds and sell it in minutes on line. Once restaurants start using Apple Pay customers and other merchants will follow. Yes Costco Visa is better rewards for select purchases but Apple Pay/card is much more secure. For better security I set my credit care alerts for any purchase over $1 dollar, anytime my card is used my watch/phone alerts me, if its not a valid purchase I can shut down my card immediately from the app.
Comments
Plus, a 2 or 3 year old car is still often under warranty for a while, so you could buy those and then buy a newer one in a few years again... to keep under warranty. You can also certainly (and they'll welcome it) take a used car to the brand-dealer it comes from. I just usually pick 3rd party shops to save money (and sometimes get better service, too). But, they don't often have the 'perks' of the dealership, especially at the higher end.
I also can't work on newer cars as well anymore, though I don't have a good place to do it (nor the tools) anyway.
The only real financial downside I can think of, is that the insurance company doesn't properly value a well-maintained vehicle. So, for example, if someone crashes into me, the insurance is just going to give me the book value of my vehicle... even if I've replaced several of the crucial parts that would have kept it on the road for another decade. So, in that sense, I could lose money under that circumstance.
I think the problem is more that 'middle class' has changed, along with the issues some people face now. Some of these things are kind of self-imposed, I suppose, but other are not.
Exactly! Hindsight is always 20/20 for this kind of thing, and the people who play and win love to talk about how they won. But, we probably don't hear so much from all the people who lost.
Some of the car companies were going fairly long on the 0% interest, though not nearly that long.