The #1 Wealth Killer No One Talks About…

@christopher5855 says:

For me a car falls into the tool, toy or status symbol categories. Cars can increase in value over time but that really only applies to classics and collectables and not your average vehicle. If you look at it from a tool or toy perspective it becomes easier in my opinion. For a tool you want something that lasts and is reliable. You also want it to be comfortable to use but it doesn’t need to be the best just has to get the job done without costing a fortune in maintenance. If you buy a toy, its because you already have the tool. The toy should be the best you can afford within the budget and used only occasionally for enjoyment because its use is inefficient compared to the tool. If you are buying a status symbol its because you have disposable income that you can throw away without impacting your financial well being.

@serlaws says:

I used to be a car enthusiast. I’ve stopped financing cars 20 yrs ago. I’d pay cash for older luxury vehicles (7 to 10 yrs old) around $15k to 25K, spend a couple hundred to make them mint then sell them for around 90% of what I originally paid a few years later after I got bored with them. I did most of the labor myself. I decided to stop this cycle and bought a beater 2006 Toyota Camry for $4500 and focus on house upgrades. My house has tripled in value. I like driving around in a modest car and coming home to a high end home. Having a nice home is a bigger “Flex” vs a nice car. It’s pretty embarrassing having a nice vehicle but living in an apartment or a rundown home.
Also, I have controlled my housing costs for the next 15 years until my home is paid off. The rental cost in my state and area is about $1000 more than my mortgage and property taxes!

@SOStudios67 says:

This video came exactly when I’ve been debating getting rid of my car. I don’t need a car for a daily commute to work. It really is staggering the monthly cost of even an older vehicle without a loan. With the prevalence of community car services it also seems pretty easy to take care of all of my errands in a month for less than $100. Living in a more urban area with higher rent can be totally worth it when factoring in saving an average of $900 a month on getting rid of a car and losing the headache of repairs, haggling with insurance people, and having to set aside useless cash piles in savings accounts for future bills and car purchases. Plus urban areas have better transit to lean on in the colder months and better cycling paths to lean on in the warmer months. I really do think if you don’t need it for a commute there are plenty of alternatives and community car services that can really replace the need to own (in a city).

@cjp592 says:

Without a car? In California? Hard to do. I agree with you that cars are a pain and cost a lot of money. I bought a new M3 when I turned 27, and it was totaled in about 2 years. My dad advised against getting such a car that can be destroyed any time. Thankfully, the accident wasn’t my fault. But I lost my car. However, I ended up inheriting my grandparents car which was brand new. I don’t know why they bought the car. But they bought the car around the same time I bought my car. And 2 years later my granddad passed away. My grandma basically ended up giving me their car. I take care of this car and still have it with only 148,000 miles. According to my mechanic, I just need to look after it with proper and timely maintenance and it should be good for another 100K miles or more even. I plan to do that. Now, I’ve challenged myself on how long I can keep this car looking and running well. Thank you grandma and grandpa. ♥️

@ElizabethGreene says:

I couldn’t agree more. It pains me to hear friends and family describe their money troubles when they have two practically new cars sitting in the driveway. My family and in-laws have always considered us “rich” or “well off” because we didn’t struggle with money. The truth is that we’re a single income household, and for most of our marriage our income was the smallest of any of us. Our secret was buing used cars (more used than you recommend in fact) with cash and driving them forever. Never having a car payment gave us disposable income and the financial wiggle room to recover when life happened.

@brianmoretti says:

Mechanical engineer here. I feel like there’s a lot more that could be added. Here’s some additional info based on both experience and engineering background.

Maintenance – Bottom line up front (BLUF), BUY FROM A MANUFACTURER WITH GOOD RELIABILITY

I know this was later in the video but there is a MAJOR thing this video overlooks that mech engineers know. MAINTENANCE, RELIABILITY AND MANUFACTURER ARE ALL LINKED. Different manufacturers have different models for how they make money and unfortunately North American manufacturers (Chrysler, GM, Ford and the other manufacturers they own) typically will sell you the vehicle cheap and then kill you in maintenance. These things break WAY more often than others. Its sometimes even worse if the parts are custom (ie. you have to buy their super marked-up parts). Now you may be able to justify the maintenance costs because the cost of the car is cheaper, BUT here are the cons:
-you don’t know when/how often/how expensive a repair will be (ie. hard to financially plan)
-you can’t drive the car while its in the shop (ie. less availability)
-it may leave you at the side of the road at the worst place and time
-MOST IMPORTANTLY -> this car won’t last nearly as long as one with better reliability. If you divide the cost of the car over its useful life, you will find that a car with better reliability will probably be cheaper in the long run.
SO who has better reliability? The two that stick out in my mind are Toyota and Lexus (just google ‘best reliability car brands’). These guys have implemented really good programs for determining failure rates for their parts, assemblies, and the complete car, and have done a lot of work to increase the reliability where it counts (ie. doesn’t really matter that the frame will last until the next ice age if the wheels have fallen off). I own a Toyota and in 6 years/190,000km I have changed the brakes once and the tires once. THATS IT. Totally worth it. Compared to my Chev Cobalt that got hit with a huge list of repairs just after I paid it off AND my dodge grand caravan that had the TRANSMISSION DIE JUST AFTER THE WARRANTY.
Quick tip: Ask your local mechanic what models they usually do/don’t see. Avoid one’s that they see often, or need repair way too early in the life cycle, or have major components failing (transmission, engine, frame, etc). Go with the ones that they rarely/never see in the shop, but there’s tons on the road.
Another quick tip: If you want to get an idea of how good the reliability is, look at what they offer as a base/extended warranty. If they tend to cover more of the car for a longer period of time/mileage that’s a good sign. Warranty’s are derived from the reliability (ie. they’ve figured out how long each component is typically going to last, added in a fudge factor, and this becomes the warranty). Essentially they warranty it because statistically speaking its not going to break (unless they screwed up something in the manufacturing). The only other reason that warranties are offered is because its sometimes cheaper to reduce the amount of inspection during manufacturing and instead have you drive it and discover what they screwed up, but this tends not to be the case. Basically, a warranty tells you what’s likely not going to break and for how long.

Financing (new vs used) – Obviously a new car is going to cost more than a used car. HOWEVER, new cars often have 0% financing whereas every used car is going to have a significant interest rate. If you have an idea of what you want to buy, compare car payments using a loan calculator online of new vs used. You may find that a new car costs you about the same per month as a used one (although the term might be longer).

Fuel – This video completely overlooks fuel economy. This is probably because most sedans are going to have comparable fuel economy, but I know I lot of people that drive pick up trucks or large SUVs but only use them for commuting and don’t have many/any kids. These things GUZZLE gas. Quick anecdote: After my car got into an accident (not my fault), I was given a rental and the first thing they had available was a GM Yukon. This thing was a MONSTER. Very comfy and looked cool, but one tank of gas was $200CAD vs my regular car which was closer to $50CAD.
In short, don’t get a large vehicle unless your actually going to use it for what’s designed for (ie. lots of kids, towing, hauling, etc).

@sfritts says:

I’ve always drove old cars. My daily driver was purchased for $500 over 5 years ago. It’s had very few issues and is now approaching 400,000 miles. Also learning how they work and taking the time to do maintenance yourself will save tons. I’m over 40 now and have never had a car payment. I could care less about status. I enjoy my nice house and financial stability.

@nicolasbenson009 says:

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@kurtKking says:

The most popular investment portfolio strategies include diversification, where you spread investments across different asset classes to manage risk. Another is the growth strategy, focused on capital appreciation through high-risk, high-reward assets. Income-oriented strategies target regular income from dividend stocks or bonds. Finally, there’s the value strategy, seeking undervalued assets for potential long-term gains.