Unfortunately many people don’t see cost, debt, and cars that way.
Imagine you get your first car, it’s used and a bit run down but you’re paying $250/month on a modest loan. Nothing crazy but you needed a loan and a car that was modestly reliable.
You get a couple of small raises, eventually the car is in the shop more and you feel you deserve a better car because of the hard work and long hours. You see ads for a new car at just another $100 per month on TV. $350/month would be tight, but you feel you’ve earned it.
You go to the dealership only to find the car you really want is closer to $500/month which you can’t afford.
The salesman says “let me see what i can do,” comes back from the finance office, and voila! Got the payment down to $375/month. It’s more than you initially expected but maybe you just don’t go out to eat as much. You’re sick of your old rust box, always in the shop. And you’ll probably get a raise soon too. So you sign.
And bam, you got a 6, 7, or even 9 year car loan. You don’t realize how much insurance will increase. You haven’t had a new car yet so you didn’t even think excise tax would be that much (for the first year of a new car its typically a lot) and now you’re struggling in debt with a new car that lost 20-35% of it’s value right off the lot, so you’re underwater on the loan.
Long winded story to say for many people a car is an emotional extension of themselves. Identity even, and it’s difficult to break that into a more utilitarian mindset. Thus justifying the high cost and debt is easier than if you were looking at it as just a way to get to point A and B
Imagine you get your first car, it’s used and a bit run down but you’re paying $250/month on a modest loan. Nothing crazy but you needed a loan and a car that was modestly reliable.
You get a couple of small raises, eventually the car is in the shop more and you feel you deserve a better car because of the hard work and long hours. You see ads for a new car at just another $100 per month on TV. $350/month would be tight, but you feel you’ve earned it.
You go to the dealership only to find the car you really want is closer to $500/month which you can’t afford.
The salesman says “let me see what i can do,” comes back from the finance office, and voila! Got the payment down to $375/month. It’s more than you initially expected but maybe you just don’t go out to eat as much. You’re sick of your old rust box, always in the shop. And you’ll probably get a raise soon too. So you sign.
And bam, you got a 6, 7, or even 9 year car loan. You don’t realize how much insurance will increase. You haven’t had a new car yet so you didn’t even think excise tax would be that much (for the first year of a new car its typically a lot) and now you’re struggling in debt with a new car that lost 20-35% of it’s value right off the lot, so you’re underwater on the loan.
Long winded story to say for many people a car is an emotional extension of themselves. Identity even, and it’s difficult to break that into a more utilitarian mindset. Thus justifying the high cost and debt is easier than if you were looking at it as just a way to get to point A and B