We Need to Talk About Car Payments.

A combination of a high interest rate environment and Americans’ preference for larger vehicles means Americans are paying more than they ever have for their cars. In this video, I go through the numbers about the average car payment in America, and look at ways to save money on cars in 2024.

“What’s with the Honda?”
“This is a perfectly good car.”

TikTok: @andythomasinvestor
Instagram: @andythomasinvestor

No financial advice is given.

#money #investing #financialfreedomgoals #financialfreedomforever #finance #financiallyfreedom #cars #carpayments #expensivecars #car #personalfinance #personalfinance101 #budget #budgeting #budgetingtips

[mikehunt]

Just fyi this made it to my youtube home page. Interesting vid, keep it up!

[SmartPracticeSuccess]

I can’t imagine having some of these car payments. I don’t feel I can even afford a $400 car payment!

I bought an ‘02 Honda Civic LX in ‘05 for $13K with $7K down. The payment was $200 and I paid it off early. I drove that car for 18 years. Yes, EIGHTEEN years! It wasn’t fancy but it wasn’t trash either. I loved that little car and it was safe and reliable.

Finally bought a brand new ‘23 Civic Touring for cash, no payment. Yay! 🥳

I’m especially grateful given current car prices.

[dunky]

I’m still driving the same car I had in high school 20 years later. I will never have a car payment never will. Paying interest on a depreciating liability yes not an asset a liability is something I will never do

[squarecircleCo]

Very nice video! Just bought my first brand new car. Paid off 1/3 of it in the first 3 months. Could resell and not lose anything at this point. Oh wanted to add 550 monthly payment. Insurance is 100

[edgeemer]

I generally agree with you, and I think the main idea is that NA cities are built around the cars. Before moving here from Europe, we were not thinking about having driver's licenses. But here a car is technically freedom - we can explore our province for way cheaper, and it cuts the 12h+2-2.5h commute (because public transportation are buses which are standing in jams) shifts of my wife to 12.5-13.0 h of total time. It is significant difference for health between 13 and even 14 hours per day for 7 days bi-weekly.

*we are speaking about CAD, the province is Nova Scotia (ocean -> rust)*

And we initially looked for the used car with no accidents and <120, 000 km on it, and all good variants were approximately 2017-2018 models ~16, 000-20, 000 before tax. The bad thing is that with an interest rate of 10-11% for the used car, higher insurance for newly licensed drivers and hidden fees from authorised "sellers" for pretty limited warranty it was the almost same bi-weekly payment as for new 2024 Mazda CX-30 with undercoating, ceramic coating and extended warranty. Interest is 1.9%. And insurance is lower, same for maintenance (and it is under warranty). And after opening the depreciation calculator it is only 30% of the car in 5 years, which is not a problem accounting for what we have and how much we save in time and money.

Still, according to your 10-20% rule, we are in the gap. Still, it also depends on the rent in the area, because 50-30-20 doesn't work in our province at all.

[nukedogger]

Sad truth is more people have car payments more than my house. I have zero payment on a brand new car, because I didn't over spend on the house. My highest car payment was $373.90 on a brand new '19 Fusion with all wheel drive, oh and $0.00 down. I've done car purchases both ways.. The paying cash hurts at first, but no payment is liberating.

[gregoryr.]

Just like anything else, if you ain't got the money in the bank to fully pay for your purchase, you can't afford it!

[itzgriff]

"$730 isn't bad, i mean its bad but not that bad" i beg to differ, anything over $500 is highway robbery. it would be more realistic if the cars held value but they do not.

[yaya_delta]

The lowest rate I could get on car finance in the UK is 11% APR at the moment, which is insane.
I would go the personal loan route, where as of now I could get 6% and not have all these limits on car ownership. Or I can just wait until rates go down, and then I’ll get myself either a 370Z Nismo, or a Mustang GT (help me choose)

[twelvenation]

im 32 and it all comes down to greed. this country is a god damn joke. you cant buy a house, a new car, food, anything without having roommates, or living with family. Don't blame the individual blame the system because thats what is truly messing everything up, BTW i live in longwood florida, rent is average $1, 500 or more and jobs pay are trash.

[richardstarr]

Ended up on my home page too - I do watch a ton of car YouTube though. Great video!

[gregoryr.]

All Japanese vehicles retain most of their value after 5 years of ownership..it's all about quality which is something you'll never see in a domestic brand...sad but true..

[garythsnal]

Your list at the end would have been cooler if you had cars that were in the 2-8k range people can buy anything for 130k. Some of my cheap favorites are amc era jeeps like the cherokee, toyotas, and small hard body pickup trucks. you can still find late era firebirds that are fast and cheap as dirt but nobody wants a muscle car that isn't ford or chevy badged. also i knew a guy with a 90s lincoln towncar that was cushy huge and would do 120mph for around 5k.

[triplemasterpiece]

You will go broke trying to be cheap with a broke down hoopty

[johnfernandez]

Yeah no! I don’t think you’ve lived in Los Angeles

[chrisniner]

He's way off on cars. ... sports cars are money pits. BMW will bankrupt you in repairs.

If you must buy one of those sporty cars, the miata is the most reliable by far... BUT... you cannot haul more than a few bags of groceries and getting in and out of it is like going to a yoga class with a sprained back.

I have owned over 100 cars.... even a Miata... I can afford to drive pretty much any car within reason and pay cash for it...

What do I daily drive? A Toyota Matrix 5 speed... 36 mpg... lots of room... you can even lay the seats down and sleep in it. Handles well and parts are corolla parts so the Pontiac Vibe is the same car with different name car payment: zero.

... embrace the