my first car…

I can’t help but to laugh (REALLY HARD) when I think back about it. Imagine this…an off white 1982 Renault with blue interior and fuzzy snow leopard seat covers.  YEAHHH BABY!!

1982 Renault

My friends can tell you all kinds of hilarious stories about this car. My mom forked out a whopping $175 (which I paid her back for in payments) for it from a man that worked with my Grandfather. He apparently used it as a “beater car” to get back and forth to work. And trust me, it stood up to it’s nick name. It was the kind of car that you parked a few blocks away and then walked to where you were going so that no one would see you. As a matter of fact, I remember one time specifically my senior year of high school that our graduating class was working on the homecoming float and I parked (what seemed like) miles away and then walked the rest of the way. To put it bluntly…..I was so embarrassed by that car, but out of the group of friends, I was the only one with a car so it got us around to the mall, to work and to hang out with friends…well almost got us there-b/c you know we had to walk some of the way!!! haha!!

The car finally died about a year later IN MY FRIEND MARIA’S DRIVEWAY! No literally, bolts falling out as we were trying to back out. It was one of those moments where the car started jerking, smoking and then you could hear the motor falling out…..dead silence…..then….insane laughter. I remember calling my Dad that day and saying “you’ll have to come pick me up, my car fell apart!”.  I  honestly can’t remember how we got to work that day.

So even though it wasn’t a brand new car with shiny rims and a state of the art radio……we had so many memories…but most importantly…no car payment. I paid the difference on my mom’s insurance policy after I had been added but I had no monthly payments on a depreciating car. THIS is when I realized, “hey, this is kinda nice” and I could work my job and pay myself money in my savings account instead of paying the bank money. I made the decision that I would NEVER have a car payment, which meant, I would never buy a brand new vehicle, never lease and that if I didn’t have the money to pay cash for a car, I wouldn’t buy it. I realized I never wanted to be servant to the bank. Seriously consider how much extra cash flow you’d have to invest somewhere else in your budget-like retirement or saving for your home, etc. if you weren’t a servant to the bank!

From that point forward, I started a “car fund” with in my budget and would save a little here and a little there until I had a few thousand dollars saved up to purchase a “new to me” car. Until this past year, none of my cars cost more than $2,500. I paid $2,500 cash for my car, had no car payment, owned it free and clear and drove them for 2-3 years……I’d say I got my money worth. If I had been paying $200 a month for 3 years, that’s roughly $7,200. I saved over $4,000 by buying a “new to me” car. I know what you’re thinking….well it wasn’t under warranty. Sure I may have had to purchase new tires, maybe new brakes, or whatever other tune up kind of things and one year I even put in a new transmission. But if you do the math if I had been making payments I would have paid $7,200. I’ll spend a few thousand dollars making the fixes without the warranty to save a few thousand. 🙂 And let’s be honest, if you can’t afford the payments on a car for a 3 year period of a loan…..you can’t afford the car you want to buy. You should never take out a loan for a car for more than 3 years.

Now, don’t get me wrong, I’m not suggesting you go out and purchase an unreliable $175 car, but think about this….purchasing a “previously owned” vehicle. WHY?   Let’s say you purchased a modest $15,000 car. The minute you drive it off the lot, you’d be throwing $3,750 out the window- the very minute minute your tires hit the road- AND you’re still expected to pay that back over the life time of the loan you took out (which a whole other topic). Your car depreciated 25% the minute you drove it off the lot…yep, sounds like a GREAT deal to me! <insert sarcasm> BUT you’re thinking….they are offering me zero percent financing for X amount of years and I’ll have that paid off before then. Don’t be fooled, you’re still paying the interest, they have just factored it into the total price they sold it to you for. It’s the same with the “Buy Here Pay Here” lots. By the time you paid all of your payments, you’ll have paid two to four times the retail cost. WHAT AN AWESOME DEAL!!!

You know that feeling of driving a brand new car off the lot, anxious to show your friends and family-or better yet, looking for somewhere to go just to be able to drive it. It’s shinny and with lots of gadgets and it smells so clean. Well, I promise THAT feeling wears off after you spill a few coffees, don’t have the money for the payment or someone scratches it with their shopping cart.

I made a promise to myself back in my senior year of high school…I will NEVER buy a brand new vehicle EVER! Even if I’ve won the lottery and have millions of dollars to spend, I don’t need the status symbol of a new car to prove anything to anyone. Besides, we’re more into the classic vintage cars anyways! tee he he!

Here’s some food for thought: 80% of Millionaires drive “previously owned” vehicles. Millionaires got to where they are today partly because they know where they can save a dollar without having to sacrifice anything. Granted, the second-hand cars of millionaires might cost more than your home, but saving money is saving money. There’s nothing wrong with driving a second-hand car.

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