melgross said: Most people can afford to take out a car loan, but can’t afford to buy it outright. You are very dogmatic about all of this. What’s good for you isn’t always good for someone else. Life isn’t about saving every penny.
True, though they don't have to buy a new car, either.
We're just talking about some general best financial practices, but I'm sure there are exceptions. For example, when we bought the new VW I talked about earlier, I didn't want to buy new, but I wanted that technology and the used market was horrible (very few for sale, really high prices), so I went new. Of course, now in hindsight, I didn't realize the whole TDI-scandal thing was going to happen and the bottom fall out of that market, etc. (And, while VW bought the car back from us, I think non-scandal, it would have been worth more than they paid us... though it wasn't that bad.)
For most of my life, I haven't had a new car. I've also never spent over $10k for a car... often even $5k (with the exception of the VW above and the car I bought when I was like 19, my second car, actually). I currently drive a quite nice (some people think it is new) BMW 328xi, and I don't even have $10k in it yet, including repairs and maintenance for the last 2 years.
Of course, I'd have been even better off buying a used Honda or Toyota (less chance of expansive maintenance), but my point is that - as a general rule - you're better off buying used, and something as close as possible to what you can immediately afford (I paid cash for the BMW). When you consider the amount of interest paid, and especially the initial depreciation hit, buying a new car isn't a very wise financial choice (for anyone!).
The reason most, even very conservative, financial gurus make an exception for a house, is that real-estate generally appreciates in value and almost no one can even get into the market without taking on debt. A car kind of seems that way, but it really isn't. I've even purchased cars to get me by a few times for around $2k. (I suppose if you can't afford $2k and *need* a car for some reason, a small loan is justified... but then you certainly should be buying new!)
Also, when we talk about 'afford' be careful to differentiate 'possible' with 'good choice.' Maybe, they also can't really afford to do so, when we take interest and depreciation into the picture (can that person who can't afford to buy outright, afford taking a several $thousand financial hit?). As Dave Ramsey would say... once you're wealthy, then go out and buy the nice new car, because you then don't have to worry about losing $thousands in the process.
The advantages of buying used may be coming to an end.
My Accord is 20 years old and, after upgrading the radio and soon the lighting, it is still a technological match for most new cars today. Yes, newer cars have gotten faster, but otherwise they are still using 20, 30, 40 year old technology.
But, with the coming of hybrids, plug-in hybrids and full electric and plus with the coming of driver assistance / crash avoidance systems cars may be entering into that Moore's Law period of technological growth that PCs are starting to exit from. Or, I was reading yesterday that Europe is considering regulations requiring cars use GPS to regulate speed to the speed limit -- and that kind of technology has almost unlimited ramifications.
That is one of the three reasons why I'm keeping my 20 year old Accord. It feels that any new car today will be obsolete in a couple years. (the other two reasons are: it's still running well (knock on wood!) and, I'm cheap.)
You'll need a 780 FICO score to get the Apple Card. There is a $200 cap regarding Daily Cash Back. I don't know if that applies to the size of the purchase or the amount of cash returned daily. No late fees, no more missed payment penalty fees, but if either occurs your interest rate is increased. Maybe it drops if you behave long enough. Don't know.
There are no doubt other revelations in the fine print, so scrutinizing the TOS is as always the smart thing to do.
Obviously, the Apple Card is not the one card to rule them all; are any? You can have 10 cards to play as circumstances dictate, to maximize your points, miles, cash back, or however you choose to manage your finances.
Something that strikes me as odd is the number of posters who claim higher benefits for their card, and don't, as some posters do, name that card and/or bank. It leaves their claims unverifiable. Why would they do that.
I only have one credit card, USAA, that seldom gets used and it's app is tedious. I'll get the Apple card just to play with the app. That card may get more use, or I'll just go back to my debit card as my daily driver, which is afforded the same fraud protection as a credit card.
It's generally best to avoid using debit cards as, if they get hacked and false charges racked up, your money is locked up until they determine that it was fraud and refund it.
At one point I thought one credit card was sufficient. That changed when Target got hacked and my credit company locked my card and then took their sweet time sending a new one. After that I have always had at least 2 cards -- one I save for repetitive charges (like my phone bill) and the other for shopping.
I definitely agree about debit cards. They started in Europe, from what I remember, because there, too many people weren’t paying their credit card bills. So this way, they had no choice. But I like credit cards because you’re using their money until you know things are good. With debit cards, they’re using your money until THEY know that things are good. And if there’s a disagreement, it’s very hard to claw that money back.
melgross said: Most people can afford to take out a car loan, but can’t afford to buy it outright. You are very dogmatic about all of this. What’s good for you isn’t always good for someone else. Life isn’t about saving every penny.
True, though they don't have to buy a new car, either.
We're just talking about some general best financial practices, but I'm sure there are exceptions. For example, when we bought the new VW I talked about earlier, I didn't want to buy new, but I wanted that technology and the used market was horrible (very few for sale, really high prices), so I went new. Of course, now in hindsight, I didn't realize the whole TDI-scandal thing was going to happen and the bottom fall out of that market, etc. (And, while VW bought the car back from us, I think non-scandal, it would have been worth more than they paid us... though it wasn't that bad.)
For most of my life, I haven't had a new car. I've also never spent over $10k for a car... often even $5k (with the exception of the VW above and the car I bought when I was like 19, my second car, actually). I currently drive a quite nice (some people think it is new) BMW 328xi, and I don't even have $10k in it yet, including repairs and maintenance for the last 2 years.
Of course, I'd have been even better off buying a used Honda or Toyota (less chance of expansive maintenance), but my point is that - as a general rule - you're better off buying used, and something as close as possible to what you can immediately afford (I paid cash for the BMW). When you consider the amount of interest paid, and especially the initial depreciation hit, buying a new car isn't a very wise financial choice (for anyone!).
The reason most, even very conservative, financial gurus make an exception for a house, is that real-estate generally appreciates in value and almost no one can even get into the market without taking on debt. A car kind of seems that way, but it really isn't. I've even purchased cars to get me by a few times for around $2k. (I suppose if you can't afford $2k and *need* a car for some reason, a small loan is justified... but then you certainly should be buying new!)
Also, when we talk about 'afford' be careful to differentiate 'possible' with 'good choice.' Maybe, they also can't really afford to do so, when we take interest and depreciation into the picture (can that person who can't afford to buy outright, afford taking a several $thousand financial hit?). As Dave Ramsey would say... once you're wealthy, then go out and buy the nice new car, because you then don't have to worry about losing $thousands in the process.
I don’t find it to be my business to tell people to buy a used car instead of a new one. That’s their choice. It’s not even good advice, in general. Buying a car for most people is a point of pride, as well as usefulness. If it makes them feel better, and they can afford it, a used car is a worse choice. Not everything is about saving money. If so, then don’t go to the movies, or eat out. Buy secondhand clothes. Don’t go on vacation either.
at what point does this end? Good financial management means that you look at your choices, and make the best ones for yourself. Those answers vary.
melgross said: Most people can afford to take out a car loan, but can’t afford to buy it outright. You are very dogmatic about all of this. What’s good for you isn’t always good for someone else. Life isn’t about saving every penny.
True, though they don't have to buy a new car, either.
We're just talking about some general best financial practices, but I'm sure there are exceptions. For example, when we bought the new VW I talked about earlier, I didn't want to buy new, but I wanted that technology and the used market was horrible (very few for sale, really high prices), so I went new. Of course, now in hindsight, I didn't realize the whole TDI-scandal thing was going to happen and the bottom fall out of that market, etc. (And, while VW bought the car back from us, I think non-scandal, it would have been worth more than they paid us... though it wasn't that bad.)
For most of my life, I haven't had a new car. I've also never spent over $10k for a car... often even $5k (with the exception of the VW above and the car I bought when I was like 19, my second car, actually). I currently drive a quite nice (some people think it is new) BMW 328xi, and I don't even have $10k in it yet, including repairs and maintenance for the last 2 years.
Of course, I'd have been even better off buying a used Honda or Toyota (less chance of expansive maintenance), but my point is that - as a general rule - you're better off buying used, and something as close as possible to what you can immediately afford (I paid cash for the BMW). When you consider the amount of interest paid, and especially the initial depreciation hit, buying a new car isn't a very wise financial choice (for anyone!).
The reason most, even very conservative, financial gurus make an exception for a house, is that real-estate generally appreciates in value and almost no one can even get into the market without taking on debt. A car kind of seems that way, but it really isn't. I've even purchased cars to get me by a few times for around $2k. (I suppose if you can't afford $2k and *need* a car for some reason, a small loan is justified... but then you certainly should be buying new!)
Also, when we talk about 'afford' be careful to differentiate 'possible' with 'good choice.' Maybe, they also can't really afford to do so, when we take interest and depreciation into the picture (can that person who can't afford to buy outright, afford taking a several $thousand financial hit?). As Dave Ramsey would say... once you're wealthy, then go out and buy the nice new car, because you then don't have to worry about losing $thousands in the process.
I don’t find it to be my business to tell people to buy a used car instead of a new one. That’s their choice. It’s not even good advice, in general. Buying a car for most people is a point of pride, as well as usefulness. If it makes them feel better, and they can afford it, a used car is a worse choice. Not everything is about saving money. If so, then don’t go to the movies, or eat out. Buy secondhand clothes. Don’t go on vacation either.
at what point does this end? Good financial management means that you look at your choices, and make the best ones for yourself. Those answers vary.
I don't, I don't, I do, I don't -- a hard life with lots of obstacles and struggles along with a healthy dose of Zen burned that kind of stuff out of me.
... Instead I just argue with you on ai.
...... And run, and go to the gym, and deliver meals on wheels, and help my grandson with his math homework and play football with him and his buddies, and maintain my home (although I'm not very good at that cleaning thingee)
Actually, its less about being able to afford it and mostly ramifications of the 401K retirement life -- after you retire, once you spend it, it's irreplaceably gone -- and in today's era of what Bill Gross calls "financial repression" that is more true than ever.
But, my next car might be a new one -- mostly because of the newer tech being introduced into them. But, otherwise they are just a bright, shiny object to me that won't make my life any better.
I am literally lol at some of these commenters. All of business, from banking to construction to real estate development, is entirely 100% based on lending, credit, debt, and repayment over time with interest. If there was no such thing the world economy would be in tatters — because few can afford to build a skyscraper or shopping center or even a house with cash. It has always been this way, and will always be this way. But sure, preach on with your cute debt-free piggy banks. Doesn’t change a thing in the real world.
We're talking about personal finance not building skyscrapers. Yes, real estate development is based on lending (but not 100% of it is) but real estate brings an income and increases in value unlike nearly everything else. And they're not charging it to their apple card, they get very low interest bank loans or bonds. We're talking about people buying a $15 drink at starbucks and paying it off over a 3 yr period at 14% interest since they couldn't afford the drink to begin with.
Many businesses have gone bankrupt as they couldn't pay back their loans, Radioshack, Toy R us, Payless, Sports Authority, Sears, and many more.
Studies have shown 100% of bankruptcies happen to those with loans.
More importantly, this is about unsecured consumer debt rather than secured business loans. Building a skyscraper requires a loan, which is secured by the skyscraper itself, and reviewed and evaluated by the lender before funds are committed. Buying a 75” flatscreen at BestBuy is not secured by anything, nor does the bank review the purchase to ensure it is a prudent risk for extending the loan. Your Starbucks example is spot on about paying high interest for immediate gratification with nothing remaing to secure the loan. This is an Apples and oranges comparison.
GeorgeBMac said: The advantages of buying used may be coming to an end.
My Accord is 20 years old and, after upgrading the radio and soon the lighting, it is still a technological match for most new cars today. Yes, newer cars have gotten faster, but otherwise they are still using 20, 30, 40 year old technology.
But, with the coming of hybrids, plug-in hybrids and full electric and plus with the coming of driver assistance / crash avoidance systems cars may be entering into that Moore's Law period of technological growth that PCs are starting to exit from. Or, I was reading yesterday that Europe is considering regulations requiring cars use GPS to regulate speed to the speed limit -- and that kind of technology has almost unlimited ramifications.
That is one of the three reasons why I'm keeping my 20 year old Accord. It feels that any new car today will be obsolete in a couple years. (the other two reasons are: it's still running well (knock on wood!) and, I'm cheap.)
Yeah, those are all valid concerns, except maybe there will be used-car deals on those new EVs and hybrids too. I've driven older cars because of a particular model I like, or that like you, I'm cheap. But, for someone who likes certain newer cars, I'd still recommend buying a 2 to 3 year old one, rather than the new one. It's almost new, and you save the quick depreciation hit.
One thing you reminded me of, though, is the safety stuff. I suppose an old car won't have all the extra air bags and sometimes more advanced safety features. But, with my BMW, it was ahead of the average car at the time, so even the newest cars aren't all that far ahead (ie: it had real anti-lock brakes, lots of air bags, fairly advanced traction control, etc.).
The tracking stuff, though, is just creepy. I sure hope that stuff takes a long time coming, if ever to where I live. I suppose eventually they'll kill enough of the enjoyment and freedom of driving, we'll welcome mass transit or take our chances with our computer-controlled overlords (the supposed autonomous vehicle).
melgross said: Not everything is about saving money. If so, then don’t go to the movies, or eat out. Buy secondhand clothes. Don’t go on vacation either.
I don't, I don't, I do, I don't -- a hard life with lots of obstacles and struggles along with a healthy dose of Zen burned that kind of stuff out of me.
Well, and I also think it is wise for people to pick what is important to them. If spending a bunch of extra money just to have a new car is important, then go for it. I think we're just saying it costs a lot of extra money, and I'm not sure how many people realize it. (Especially, I think, in the USA where too many people just refresh their car every 5 or so years.)
re: obstacles and struggles - I can somewhat relate there... if I could go back and adjust a few things over the years (not even including buying AAPL at the right times!), I'd probably be pretty well off. But, the cards just didn't play out like that. I'm getting by, but not nearly like I'd have guessed earlier on in my career(s). And, retirement (age anyway) is approaching more quickly than I'd like, too....
mac_128 said: More importantly, this is about unsecured consumer debt rather than secured business loans. Building a skyscraper requires a loan, which is secured by the skyscraper itself, and reviewed and evaluated by the lender before funds are committed. Buying a 75” flatscreen at BestBuy is not secured by anything, nor does the bank review the purchase to ensure it is a prudent risk for extending the loan. Your Starbucks example is spot on about paying high interest for immediate gratification with nothing remaing to secure the loan. This is an Apples and oranges comparison.
Best and worst case, yes. But, there is a lot of middle-ground on the business side too. Hopefully most of that is contained to 'investors' but unfortunately it isn't always.
melgross said: Most people can afford to take out a car loan, but can’t afford to buy it outright. You are very dogmatic about all of this. What’s good for you isn’t always good for someone else. Life isn’t about saving every penny.
True, though they don't have to buy a new car, either.
We're just talking about some general best financial practices, but I'm sure there are exceptions. For example, when we bought the new VW I talked about earlier, I didn't want to buy new, but I wanted that technology and the used market was horrible (very few for sale, really high prices), so I went new. Of course, now in hindsight, I didn't realize the whole TDI-scandal thing was going to happen and the bottom fall out of that market, etc. (And, while VW bought the car back from us, I think non-scandal, it would have been worth more than they paid us... though it wasn't that bad.)
For most of my life, I haven't had a new car. I've also never spent over $10k for a car... often even $5k (with the exception of the VW above and the car I bought when I was like 19, my second car, actually). I currently drive a quite nice (some people think it is new) BMW 328xi, and I don't even have $10k in it yet, including repairs and maintenance for the last 2 years.
Of course, I'd have been even better off buying a used Honda or Toyota (less chance of expansive maintenance), but my point is that - as a general rule - you're better off buying used, and something as close as possible to what you can immediately afford (I paid cash for the BMW). When you consider the amount of interest paid, and especially the initial depreciation hit, buying a new car isn't a very wise financial choice (for anyone!).
The reason most, even very conservative, financial gurus make an exception for a house, is that real-estate generally appreciates in value and almost no one can even get into the market without taking on debt. A car kind of seems that way, but it really isn't. I've even purchased cars to get me by a few times for around $2k. (I suppose if you can't afford $2k and *need* a car for some reason, a small loan is justified... but then you certainly should be buying new!)
Also, when we talk about 'afford' be careful to differentiate 'possible' with 'good choice.' Maybe, they also can't really afford to do so, when we take interest and depreciation into the picture (can that person who can't afford to buy outright, afford taking a several $thousand financial hit?). As Dave Ramsey would say... once you're wealthy, then go out and buy the nice new car, because you then don't have to worry about losing $thousands in the process.
I don’t find it to be my business to tell people to buy a used car instead of a new one. That’s their choice. It’s not even good advice, in general. Buying a car for most people is a point of pride, as well as usefulness. If it makes them feel better, and they can afford it, a used car is a worse choice. Not everything is about saving money. If so, then don’t go to the movies, or eat out. Buy secondhand clothes. Don’t go on vacation either.
at what point does this end? Good financial management means that you look at your choices, and make the best ones for yourself. Those answers vary.
I don't, I don't, I do, I don't -- a hard life with lots of obstacles and struggles along with a healthy dose of Zen burned that kind of stuff out of me.
... Instead I just argue with you on ai.
...... And run, and go to the gym, and deliver meals on wheels, and help my grandson with his math homework and play football with him and his buddies, and maintain my home (although I'm not very good at that cleaning thingee)
Actually, its less about being able to afford it and mostly ramifications of the 401K retirement life -- after you retire, once you spend it, it's irreplaceably gone -- and in today's era of what Bill Gross calls "financial repression" that is more true than ever.
But, my next car might be a new one -- mostly because of the newer tech being introduced into them. But, otherwise they are just a bright, shiny object to me that won't make my life any better.
My friends (these are guys I get together with every Friday) and I discussed this the other day. Half buy new cars every few years, which timing varies between then, and the others have bought new or used ones over the years. The conclusion (we’re all retired, except one guy) is that it doesn’t matter either way. A couple of them buy a new car each time, but take good care of it, and keep it for five to fifteen years. They feel that’s the best investment for them. Others do different things depending on what car they want.
i do have some friends who just buy a new car every year, because they can afford it, and that’s what they want. I’ve got one friend who has enough money to buy a small nation. He actually buys a new Rolls every year, because as he tells it; “What am I going to do with the money, and I get two thirds back when I buy the new one, so it’s only about $150,000 a year”.
melgross said: A couple of them buy a new car each time, but take good care of it, and keep it for five to fifteen years. They feel that’s the best investment for them. Others do different things depending on what car they want.
They might enjoy doing that, but it isn't the best financial investment. You can do the same thing buying a 3-yr-old one used, and save a bunch of money. That's more my point... not what they should or shouldn't do. I shouldn't have bought the BMW, but probably a Toyota or Honda in terms of pure financial reason.
melgross said: A couple of them buy a new car each time, but take good care of it, and keep it for five to fifteen years. They feel that’s the best investment for them. Others do different things depending on what car they want.
They might enjoy doing that, but it isn't the best financial investment. You can do the same thing buying a 3-yr-old one used, and save a bunch of money. That's more my point... not what they should or shouldn't do. I shouldn't have bought the BMW, but probably a Toyota or Honda in terms of pure financial reason.
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.
Standard isn’t always best when many cards have better rewards than 2%. Also, my standard purchases are extremely low compared to other categories. There’s practically nowhere that I purchase things that I can’t get at least 3% back and up to 5% on most things.
Depends on how one defines "best", doesn't it? The Amazon Prime Store Card, for example, gives you 5% back... with a 28.24% annual APR.
Apple committed to a low (albeit unspecified) APR, with no fees, no late charges, and no penalties. Not to mention the not-so-minor fact that you get your rewards back daily as Apple Cash. Not at the end of the month, not when you redeem them. Daily.
Then there's the secure unique randomized card number per transaction. No number or signature to steal on the physical card. No tracking of purchases. No sales of transaction data.
I don't know about you, but there's a ton of value in privacy and security.
Fees and APRs don’t matter if you pay your balance in full.
You realize that being able to pay off your cards every month isn’t the norm, right?
If you think the “norm” is being stupid then we have a problem. By the way I learned this the hardway and have drastically changed my use of a credit card. At this point I try to keep all card purchases beyond an emergency at a level easily payable every month. The average person can literally save themselves hundreds of dollars a year by doing so.
Frankly it wouldnt hurt for our educational system teach students why being conservative in your use of money is so important.
Whether you believe it's stupid or not is completely irrelevant. Most people cannot pay off their cc every single month, and use it to get by when they need to. It's not even a matter of intelligence, I assure you.
Maybe you shouldn't buy what you can't afford then. And, I doubt it's most people.
You're free to doubt whatever you like. I worked for Capital One corporate for years and will believe and share what I experienced. Again, it's not about your ivory tower morality judgements from on high. It's about the reality of the economy -- the once booming middle-class is being eradicated, and the segments that are growing are low-income, and the very-high income. ie, the rich get richer while the poor get poorer. The middle-class and the promise of the American dream of my parents and grand-parents age where a single-earner need only show up and work hard to get that house and two cars is long gone.
It's disappeared for the blue collar worker but not yet in the STEM fields which is why folks are beating on the STEM drum. At some point that will change as well and it will be some other set of fields where the middle class with a middle class education can succeed at the American dream. The middle class seems to have stopped shrinking and stabilized around 51-54% (down from 61% in 1971). Upper income increase from 14% to 19% and lower income increased from 25% to 29%.
A 10% drop is large but 5% went up and 5% went down and 52% isn't "eradicated".
Standard isn’t always best when many cards have better rewards than 2%. Also, my standard purchases are extremely low compared to other categories. There’s practically nowhere that I purchase things that I can’t get at least 3% back and up to 5% on most things.
Depends on how one defines "best", doesn't it? The Amazon Prime Store Card, for example, gives you 5% back... with a 28.24% annual APR.
Apple committed to a low (albeit unspecified) APR, with no fees, no late charges, and no penalties. Not to mention the not-so-minor fact that you get your rewards back daily as Apple Cash. Not at the end of the month, not when you redeem them. Daily.
Then there's the secure unique randomized card number per transaction. No number or signature to steal on the physical card. No tracking of purchases. No sales of transaction data.
I don't know about you, but there's a ton of value in privacy and security.
Fees and APRs don’t matter if you pay your balance in full.
You realize that being able to pay off your cards every month isn’t the norm, right?
If you think the “norm” is being stupid then we have a problem. By the way I learned this the hardway and have drastically changed my use of a credit card. At this point I try to keep all card purchases beyond an emergency at a level easily payable every month. The average person can literally save themselves hundreds of dollars a year by doing so.
Frankly it wouldnt hurt for our educational system teach students why being conservative in your use of money is so important.
Whether you believe it's stupid or not is completely irrelevant. Most people cannot pay off their cc every single month, and use it to get by when they need to. It's not even a matter of intelligence, I assure you.
Maybe you shouldn't buy what you can't afford then. And, I doubt it's most people.
You're free to doubt whatever you like. I worked for Capital One corporate for years and will believe and share what I experienced. Again, it's not about your ivory tower morality judgements from on high. It's about the reality of the economy -- the once booming middle-class is being eradicated, and the segments that are growing are low-income, and the very-high income. ie, the rich get richer while the poor get poorer. The middle-class and the promise of the American dream of my parents and grand-parents age where a single-earner need only show up and work hard to get that house and two cars is long gone.
Bingo! The elitist and judgemental comments being posted, i.e. "Maybe you shouldn't buy what you can't afford then" is sad and only serves to illustrate how out of touch and/or ignorant some people can be.
Many immigrants live by this ideal so their kids can get out from being on the lowest tier of the income bracket. If you follow this advice, work hard and make sure your kids go to school the odds in this country are in your favor...which is why immigrants come here in the first place.
Apple the most disruptive corporate force in entrenched business practices. They shook the Computer Industry to its core and changed the way people interacted with computers. They did this by changing the basic philosophy and premise of computing. They personalized it. Game Changer. They did it with music, how it was distributed, how it was carried, how it was consumed. Game Changer. Now they are bring that same disruptive force to the financial industry. Credit Cards have been pretty pedestrian for decades. They have been entirely industry (financial industry driven) as a result the ways they have tried to interact with their consumers have been more and more driven by their self interest with little concern for the consumer experience. AppleCard... Game Changer.
Does it break the mold for rewards? Nope. Does it break the mold for cost? Nope. Does it break the mold for all things reward driven Credit Card? Nope. It just thinks different and delivers a better consumer experience in delivering it. Apple just Apple-ized Consumer Credit. 10 years from now we will all look back and say "of course making it easier for Credit Approval should be this easy. Of course all of the things that AppleCard just delivered to consumer finance should have been implemented." Except Chase, Bank of America, Well Fargo, and a myriad of other Financial Industry Titans could have done it but didn't. They had to have the foundation of their business model moved beneath them by Apple.
Troll away with, how "Meh, my card does all that already. Big Deal! Why are Apple fanbois such tewls?", indifference. DOS command line users used to LOVE how easy it was to do things too. Now we all just do things differently. We all just do things differently, more intuitively, and simply, since Apple decided to innovate the processes.
If you think the Apple Card is a game changer, you've set a very low bar.
And your indifference to the shift will be looked at as part of the problem that Apple just solved for an industry it didn't NEED to be involved in. Apple doesn't make moves and involve itself in things if it doesn't feel like it can make a significant (read profitable) change in a significant way. This big dog doesn't get off the porch unless there is a need. You staring at the enormity of the dog and saying " psssshhht! I've seen bigger dogs" Misses the point a little. You pulling the curtain back and pointing to the Great Wizard, 5 minutes into the movie, misses the point a bit. It's all Meh bro, life isn't that complicated. Your indifference and nonchalantness isn't all that earth shattering, in fact Microsoft and IBM used to say "they only represent less than 3% of all computer users..." too. How is that indifference working out for them?
So Apple is now a martyr for saving the credit card industry? My credit card is a next to nothing part of my life. I charge things on it, pay it off when due and don't think twice about it. This is not what made Apple great.
LOL You sir are not the average consumer. Congrats on WINNING! Apple isn't a martyr. They won't die because of this. They will however, usher in a changed ecosystem that never existed before. They will usher in a new and easier way for the "average consumer" to interact with their finances. Bro clearly this isn't a big deal to you. However, your incredible money skillz aren't who this is for. This is for the average user. This is for the masses. This just took your "I'm winning at life cuz I can finance..." and made it easier for the average user to win. GAME CHANGER. Your once venerable DOS Command Line user skillz have just been fossilized. Welcome to irrelevance.
So it's for people who buy stuff they don't need, with money they don't have to impress people they don't like (to quote Dave Ramsey). In other words, imbeciles.
The worst kind of imbecile is one who does not understand the opportunity cost of using one’s capital.
When someone says “I never take on debt,” they simply have no clue how they could have invested their capital to earn a higher rate of return, and therefore how, by avoiding debt, they’re incurring an opportunity cost.
I recommend some Econ 101.
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.
Given the $50K car at 0% example, would you have made more or less money buying a $25K car and not had to sell $50K during this last boom cycle? The CAGR, adjusted for inflation was 11.68% from Jan 1, 2009- Dec 31, 2018 so that $25K of "free money" vs buying a cheaper car cost $72K.
It's not like they are going to give you 10 years at 0%.
Very cool card, great secure service and seems a fair in terms of all its "no costs" option. I love it but I really, really want to earn frequent flyer miles with my credit card. Frequent flyer miles that I can transfer to any airline or at least the main airlines. With that option, I am all in with AppleCard and to be able to say good bye to Australia banks credit card would be so great to help prize apart their colluding grip on Australia consumers!!
Australian banks, like Westpac and Nab continue to solely focus on their shareholders than they do costumers and this is surely going to back fire as other services come in that are better value, safer more secure and ultimately act to service the user than to line the pockets of their shareholders with complete disregards to what their customers actually want. Bring it on Apple... with frequent flyer points of course.
Standard isn’t always best when many cards have better rewards than 2%. Also, my standard purchases are extremely low compared to other categories. There’s practically nowhere that I purchase things that I can’t get at least 3% back and up to 5% on most things.
Depends on how one defines "best", doesn't it? The Amazon Prime Store Card, for example, gives you 5% back... with a 28.24% annual APR.
Apple committed to a low (albeit unspecified) APR, with no fees, no late charges, and no penalties. Not to mention the not-so-minor fact that you get your rewards back daily as Apple Cash. Not at the end of the month, not when you redeem them. Daily.
Then there's the secure unique randomized card number per transaction. No number or signature to steal on the physical card. No tracking of purchases. No sales of transaction data.
I don't know about you, but there's a ton of value in privacy and security.
Fees and APRs don’t matter if you pay your balance in full.
You realize that being able to pay off your cards every month isn’t the norm, right?
For our Amex card it is. There are lots of people using that. I would imagine that most idevice users have one.
However even AMEX can be used as a pay as you want card after you having paid it in full for a number of years. It gives flexability. However I always pay the cards off in full.
Very cool card, great secure service and seems a fair in terms of all its "no costs" option. I love it but I really, really want to earn frequent flyer miles with my credit card. Frequent flyer miles that I can transfer to any airline or at least the main airlines. With that option, I am all in with AppleCard and to be able to say good bye to Australia banks credit card would be so great to help prize apart their colluding grip on Australia consumers!!
Australian banks, like Westpac and Nab continue to solely focus on their shareholders than they do costumers and this is surely going to back fire as other services come in that are better value, safer more secure and ultimately act to service the user than to line the pockets of their shareholders with complete disregards to what their customers actually want. Bring it on Apple... with frequent flyer points of course.
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
But, with the coming of hybrids, plug-in hybrids and full electric and plus with the coming of driver assistance / crash avoidance systems cars may be entering into that Moore's Law period of technological growth that PCs are starting to exit from. Or, I was reading yesterday that Europe is considering regulations requiring cars use GPS to regulate speed to the speed limit -- and that kind of technology has almost unlimited ramifications.
That is one of the three reasons why I'm keeping my 20 year old Accord. It feels that any new car today will be obsolete in a couple years. (the other two reasons are: it's still running well (knock on wood!) and, I'm cheap.)
https://archive.org/details/AppleIieBrochureA2f2201/page/n13
I don’t find it to be my business to tell people to buy a used car instead of a new one. That’s their choice. It’s not even good advice, in general. Buying a car for most people is a point of pride, as well as usefulness. If it makes them feel better, and they can afford it, a used car is a worse choice. Not everything is about saving money. If so, then don’t go to the movies, or eat out. Buy secondhand clothes. Don’t go on vacation either.
at what point does this end? Good financial management means that you look at your choices, and make the best ones for yourself. Those answers vary.
Actually, its less about being able to afford it and mostly ramifications of the 401K retirement life -- after you retire, once you spend it, it's irreplaceably gone -- and in today's era of what Bill Gross calls "financial repression" that is more true than ever.
One thing you reminded me of, though, is the safety stuff. I suppose an old car won't have all the extra air bags and sometimes more advanced safety features. But, with my BMW, it was ahead of the average car at the time, so even the newest cars aren't all that far ahead (ie: it had real anti-lock brakes, lots of air bags, fairly advanced traction control, etc.).
The tracking stuff, though, is just creepy. I sure hope that stuff takes a long time coming, if ever to where I live. I suppose eventually they'll kill enough of the enjoyment and freedom of driving, we'll welcome mass transit or take our chances with our computer-controlled overlords (the supposed autonomous vehicle).
Well, and I also think it is wise for people to pick what is important to them. If spending a bunch of extra money just to have a new car is important, then go for it. I think we're just saying it costs a lot of extra money, and I'm not sure how many people realize it. (Especially, I think, in the USA where too many people just refresh their car every 5 or so years.)
re: obstacles and struggles - I can somewhat relate there... if I could go back and adjust a few things over the years (not even including buying AAPL at the right times!), I'd probably be pretty well off. But, the cards just didn't play out like that. I'm getting by, but not nearly like I'd have guessed earlier on in my career(s). And, retirement (age anyway) is approaching more quickly than I'd like, too....
Best and worst case, yes. But, there is a lot of middle-ground on the business side too. Hopefully most of that is contained to 'investors' but unfortunately it isn't always.
i do have some friends who just buy a new car every year, because they can afford it, and that’s what they want. I’ve got one friend who has enough money to buy a small nation. He actually buys a new Rolls every year, because as he tells it; “What am I going to do with the money, and I get two thirds back when I buy the new one, so it’s only about $150,000 a year”.
well, ok!
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.
A 10% drop is large but 5% went up and 5% went down and 52% isn't "eradicated".
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.
Given the $50K car at 0% example, would you have made more or less money buying a $25K car and not had to sell $50K during this last boom cycle? The CAGR, adjusted for inflation was 11.68% from Jan 1, 2009- Dec 31, 2018 so that $25K of "free money" vs buying a cheaper car cost $72K.
It's not like they are going to give you 10 years at 0%.
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.