Financial Pitfalls: The New Car Mentality

by Miriam Caldwell | More from this Blogger

One big financial pitfall is the new car mentality. Many people like to drive new cars and feel they need the safety and security. Here are four myths that support the new car mentality.

1) Many people feel that they need the latest model car. A new car is a status symbol. There is a certain feeling of accomplishment when you drive a brand new car off of the lot. You have achieved something. But you have also lost something. The average new car depreciates two thousand dollars the second you drive off the lot. If you have two thousand dollars to throw away, then this may be a good option for you.

2) Others worry that buying a used car would be less reliable. This may be true if you are buying an old car or one with over a hundred thousand miles on it. You should never buy a car that has been in accident, because more work will need to be done on it. You just need to check out the history on the car and have it looked over by a mechanic. If you buy a car that is three years old you most likely will not have any problems with it.

3) Another reason to buy a new car is the zero percent interest offers on the loan amounts that are being offered. Generally the money you save by buying a used car will still be more than what you would save on interest charges.

4) Many people like to lease, because it means a new car every two or three years. This also means car payments for the rest of your life. While a car is not really an investment, is it wise to continually put money towards a car? If you have had a time with no car payment you will likely say no.

Related Articles:

To Buy a New or Used Car

Intro to Buying a Car

Learn more about Miriam Caldwell

Miriam is a SAHM mom of three children. She has a daughter who is seven, and two sons, four and two. She loves being a parent and spending time with her children.

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