My car has been causing me trouble and I am fed up with driving this hunk of junk. What would you advise me about getting a new car. How much should I pay for it? I saw the cutest yellow sports car at the BMW dealership the other day.
Get another car! Sell the first one, or if it isn’t worth anything, then donate it to a good charity in exchange for a tax receipt. Now, the idea of another car? I know you would love to buy new so you can get the colour you want, and the smell of a new car? Ooh la la…but ouch! This is about the worst thing to do financially, unless you can get one that is about to be depreciated because it’s a leftover on the lot at the end of the year, or if you buy a demo. I am a fan of NOT buying new, but rather buying one that has been gently used. Often the cost is half of a new car. I would prefer that even in buying this car that you use an existing asset as collateral (life insurance is the best!), one that will continue to grow while you are borrowing against it. I will write more about this strategy later.
Buying used, instead of buying new, is a better long term car strategy, even if you want to replace them every four years with a new make or model!
Thanks for writing!