The other day, I shared how my minivan got a giant crack in the bumper (Greg probably did it) without my knowledge, and how we chose to ignore the Joneses and fix it with duct tape.  Despite the fact that I didn’t make any disparaging remarks about people who finance new or used vehicles, I received this comment:

Cars are for enjoyment. You can’t think it’s not okay to buy a car that you enjoy and drive every day of your life. You can’t take money with you when you die. Stop belittling people who buy things they want if they can afford it. I manage my $450 payment just fine thank you very much.                             -Anonymous

Defensive much?  Geez, you would think that I called his/her momma fat, slept with his/her little sister or brother, or stole his/her beloved family pet.  Note: Why does anyone care what I think in the first place?   Discuss….

Here’s Why Car Payments Suck

Anyway, I’m sticking to my guns on this one.  Car payments suck.  Even if you have an extremely high income and can afford it, paying several hundred dollars per month is rarely a good idea.  Here’s why:

  • Car payments are simply a way to buy something you cannot afford- Do you know why I hate car payments?  They allow people to buy things that they truly cannot afford, simply by letting them pay a monthly payment for anywhere from two to six years.  I’ve been there.  When I was in my early 20’s, I bought a brand spankin’ new Mitsubishi Galant for almost $25,000.  Could I afford it?  Hell no, I couldn’t!  I was working in a group home for $8.00 an hour at the time.  Fail!
  • You’ll never own anything- If you finance a car because of an incredibly low interest rate then invest your money elsewhere, I totally get it.  The only problem is, most people I know pay off their vehicle then immediately trade it in for a new one.  I’ve literally seen it happen dozens of times.  For some reason, having a car payment keeps people in the mindset that it’s “normal” or even a necessary evil.  Guess, what folks.  It isn’t.
  • Cars are a depreciating asset- When you buy a fancy new car, those $500 monthly payments might not be that painful.  But, look ahead a little.  Five years later, when your car is worth roughly the same amount as a Coach purse, you may feel differently.  Everyone knows that cars begin to depreciate rapidly the second you drive them off the lot.  Don’t compound that problem by committing to a huge monthly payment for your kid’s entire childhood- or worse yet- paying interest for the privilege.

Since I pretty much hate paying bills, it shouldn’t come as a surprise that I think car payments suck.  There are a million reasons I would rather just keep driving my beater minivan and banking the $300-$500 I’m saving each month by not having a car payment.  (When I do need a new car, I will buy a used model with cash)  I can also think of a million ways I would rather spend $450 every single month, including:

  • Investing it in Vanguard funds
  • Hosting an epic block party in my neighborhood
  • Saving it in my kid’s 529 plans
  • Investing it into writing for my other website
  • Taking my family to Benihana six times
  • Almost anything besides paying a car payment
  • I hate car payments

How about you?  Do you think car payments suck?  What would you do with an extra $450 per month?

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