True, but as an atheist I never take on debt. Net worth 1.7 million at 45. My dad taught me to only buy what I could pay for. Paid for house. Paid cash for my Outback. Worked through college and graduated debt free. Currently make 130K a year. Just pumping up my savings and mutual funds.
I drive a 24 year old Toyota Corolla that I bought new. I still have the car after 24 years of course. It still looks good and runs like a top. I was able to retire with a 2 million dollar net worth, a paid off house and no debt. I can basically live off my Social Security income without tapping into my 401 k plan or savings. I believe a lot of that has to do with my beloved Toyota.
Congratulations!. 🎉🍾🎈🎊 I’m happy for you!. Back in 2013, I paid cash for a brand new 50 MPG Toyota Prius Hybrid. Still running like new. Since retiring I rarely drive; so my Prius will likely outlast me. Thank God I have never been materialistic and always a saver. Living frugally and being a minimalist(consumer marketing schemes/traps won’t work on me. I don’t need their crap), I retired free of debt and happily left the wage slavery rat race workforce system in 2021 with my employer matched and unmatched retirement accounts, my nice size savings and emergency fund which will see through at least 2 years of my expenses. Not to mention collecting my well earned Social Security benefits I paid into for decades. The last 24 years busting my butt working in healthcare as a (RT)Respiratory Therapist(my 2nd career) and through the Covid/Delta pandemic 😷. Prior to that, I busted my butt 10 years working in the Graphics field(my 1st career) until my 3rd layoff due to company loss of contracts and revenue. I then earned my degree, passed my state licensure board exams and required certifications, became a Respiratory Therapist, then retired. To save money💰in these uncertain and ridiculous inflationary times, our family of retirees consolidated. I moved from my former residence. My sister, her husband and son opened their home 🏡 for me(my sister’s brilliant idea 💡). I’m renting a room and contributing money 💵 for household necessities: groceries. A win, win for all of us. Today our family of retirees is gratefully blessed, thriving and enjoying a well earned comfortable retirement. God is providing. So no worries or fears here/Peace of mind. This is true wealth.😊
@@cathyallshouse2981you would be a minority. You could have got a lemon. If it was newer that possibility is higher. The older ones this guy was talking about are tanks. I had a 95 Tacoma and I put 400k miles on it. Your bad experience is not what most people experience. There is a reason why most millionaires drive Toyotas. Your comment comes off jaded . Be happy for this guy. He made good decisions in life
I have been on my debt free journey for 3 years now. I have 2 paid off cars. My only debt is my house. I am really shocked by how quickly money stacks up when I don’t have debt payments every month. My mind is blown🤯
@@therichbuddha3277 Meh, back in 2012, my wife and I decided to get into a $1200 per month mortgage instead of riding around in car mortgages. We love our modest home. We are able to pay for the mortgage because we drive good reliable used vehicles. That's just us though. My latest car is a 2010 Nissan Versa 1.8 hatchback with 151k miles. It looks decent and I paid $4700 cash for it so that we can keep paying off my house. Good luck out there.
as a 20year old guy, fighting the urge to waste all my savings on a sports car is at times almost irresistible. thank you for speaking sense into us with this video.
I bought my first property at 25 (I'm 40 now and work part time ) . When I was driving a stupid car at 25 my banker colleagues laughed at me. Now they work as they don't have a choice. I work when I feel like it.
Yep. 23 years for me without a payment. Driving a 2008 minivan that we purchased in 16 with cash. I probably drop $1500 in repairs (on top of maintenance) a year, but that's like 2 new car payments. In total in 2023, I paid $4573 in total automotive costs. That's insurance, gas, renewals/taxes, maintenance, and repairs.
You are correct Austin. What's even worst than having a car on finance is, having a truck on finance. You'd have to be a special kind of moron to finance an 80k truck, when you don't even work in construction or landscaping. The pain is really felt at the pump and when you lose your job. When I got our Used Accord, (3 years ago) I could walk into any dealership and drive out with a brand new car/truck. I have good credit and had plenty of money for a big down-payment. However I decided to get a used one instead. Still driving it today with no major issues, at over 200k on the odo. Costs me about $200- / month to keep it up, FULLY PAID and now it's actually worth more than when I got it! I am not here to impress anyone, as long as it gets me from A to B in relative comfort and safety, that's all it matters. Peace
Nice timing. I just spent $1,000 to have brakes serviced AND had a $450 payment for auto insurance. Even if your car is paid off, you still get screwed. But if you have a payment for a car, even worse. Moral of story: Cars destroy personal wealth.
I quit driving back in 2021. I live within walking distance of most places or I take the public transit bus which is only a dollar a trip. It is a lot cheaper than owning a car. Yes sometimes I do miss having my car but I have learned to live without it
My car has been paid off for years. Actually, we are debt free. Getting the car paid off, freed up $500/month. We were able to pay off a lot with that. We're saving for our next one now.
I love my paid off land yacht! 2011 Grand Marquis Ultra reliable, just replaced struts and coil springs front and back for $300. That's with name brand parts. 29mpg highway
Thank you for sharing, one of the car expenses that we forget all the time is parking space. Monthly parking at work $120.00 Monthly parking at condo $ 110.00 Plus daily parking when you visit other city or area etc.
I used some of my emergency fund to pay off the remaining balance back in May. One of the best decisions I've made. I'm rebuilding what I had and should be back on track at the end of this year, which is the original time I would've paid my car off. It just feels better to drive it knowing I have the title to it!
Hubby and I are driving an old piece of crap that we share. Been paid off for a long time. Wish I would have understood this though when we were younger. Now we get it......cash cars only. Nothing financed.
Amen! Haven't had a car payment for 29+ years - buy em and hold em is our mantra - replaced a 1993 Buick Regal GS (16 years/320,000 miles) - running a 2009 Honda Fit (new-cash) and a 2015 Honda Odyssey (new-cash) now, and they are running like champs (take care of them and they will take care of you....). Paying off your mortgage (if you have one) as quickly as possible is a winner too.
I have a used car and it still runs like new. It is only 9 years old. I got it for $3100(one-time purchase and no car loan) and I love driving it. I think it was a worthwhile purchase.
@@notanomad9320 I I also have two old paid for Toyotas one of them is a 2010 Corolla.I’m not totally against the car but I love my paid off bicycles way more 😂. Very little maintenance no license plate or insurance no parking issues no gasoline just good ol fashion man power and let’s don’t forget the awesome benefits of exercise . I leave those cars sit as much as possible!
@@CharlesJones-bu5hk bikes are ok in good weather but when it gets 20 below and snow drifts you have to deal with, I prefer my car. I have all the winter gear but the car works better in those conditions. I rode year round many years before I had a car, it's not easy.
Having a car on finance is crazy to me, I've always bought a second hand cars in cash. I'm 40 and on my 3rd car. I know a guy that is 63 and changes his car every 2 years and is always broke.
@@Kyledudegot buying a car cash doesnt mean the car is always trash, im not sure if thats what you were getting at, but theres lots of great reliable cars for under 10,000 usd.
True its very much a luck draw or you have to know about cars I brought a mechanic out and everything and that car was still a lemon . Financing isn't the best but sometimes you gotta do what you gotta do I just can't afford to make the same mistake.
I would 100% rather take the buss but where im at it's 110 degrees and it takes an hour and 30 minutes to get there to work , and it makes it SOO DIFFICULT to get anywhere , I really hated the idea of car payments but im so over the whole 3 hr commute , and I really don't want to take a risk with a cash car anymore . 😂 Lol
my opinion is simple, buy a car you can afford without any loans. Once we had a car stolen just after we've bought a house, and we had very little money left, so I've bougt a 2001 micra for £400 which I've ended up selling for the same price after 8 months. Right now I'm driving a 2005 passat b5.5 and it's a very reliable model, and it also costs around £900-ish. I could now easily afford more expensive car, but i prefer old reliable models.
I drive a Honda Fit LX (most basic model). Paid cash for it new in 2015. I don't drive much so makes no sense to have anything nicer (6k miles/yr ). Always reliable and cheap to maintain.
In Germany i pay for my VW Polo / Natural Gas. only Tax of 22 Dollar a Year. 60 Miles cost 8 Dollar Gas and insurence is 300 Dollar a year. But pay of is also in Europe the most importent thing.
I bought a rebuilt 2007 honda accord with 142,000 miles on it for $4,500 back in 2015. I am driving her to this day. She's got a little over 204,000 miles on her and I am not planning on breaking up with her until she decides she's had enough of me😂. Best $4,500 ever spent. Love your car and she will love you back!
*Excellent!! Everyone needs more than their salary to be financial stable. The best thing to do with your money is to invest it rightly, because money left for saving always end up used with no returns.*
You are absolutely right If you don't find a means of multiplying your money, you will wake up one day and realize that the money you thought you had, had been exhausted. Investment is a ladder to climb the financial wall.
My car is my father's 1st car,then after some years it was my older brother's 1st car.then it was given to me as my 1st car.this car has so many great stories and good memories that money can't buy.surely my son will be his 1st car too.
Loving your channel, Austin. I was just thinking the other day that of every material possession I have, there is none I am more grateful for than my car. It's nothing fancy - a 2013 Honda Civic, which I leased new and then financed to own. I paid it off in 2022, and thanks to the pandemic, which got me switched to working from home, now has less than 125k miles on it. It is reliable, gas efficient, it helped tremendously in building my credit, and best of all, it's mine free and clear. I got myself into some credit card debt (very foolishly, as I actually make a decent salary and should never have needed credit) and am aggressively paying it down - hope to be debt free in about 8 months by living frugally and throwing all my extra money at the debt. A simple, content life is my ultimate goal. I've watched a lot of minimalism/frugal living channels lately, and yours is by far my favorite. Thanks for all the perspective, and keep up the good work!
Wise advice as always! There are still good used car deals to be found, especially with private sales. I highly recommend a Japanese car, under $5K, with under 100K miles. Just be sure to have it checked out by a competent mechanic prior to purchase. I bought my 2017 Subaru Forester new 8ish years ago. It was $30K, with 0.9% interest. (Remember those days)? I paid it off years ago, and continue to make the equivalent monthly car payment into a high interest savings account. I only dip into that account if I need a repair on my car or e-bike.
There are advantages but cars get old. I paid off my car and then ended up with thousands and thousands of mechanical expenses, so much that I was forced to buy a new car… never again.
Austin, this such an overlooked method for a person to get further ahead in life financially than they can possibly imagine. I paid my Honda Accord off in 2013 (paid an extra $100/month to pay it off quicker). Once in awhile I get tempted to buy a newer vehicle, but then check myself and say inwardly, "are you crazy? Why would you do that to yourself?" Even if I could pay cash for it, I'd rather set up my money to be working for me, not the other way around.
We haven't had a car payment in 15 years and hopefully we never will again. Our current cars are around 10 years old and going strong. No plans to replace either of them. That is a _lot_ of money saved. Much of which was stashed away in the Roth's.
I am still driving my 2003 Toyota Camry. Runs great. Never gives me any trouble. I have enough money in savings to buy a new car in cash but as long as my Camry still is in good shape, I am not getting a new car. Credit Unions are the best place for low car loan rates. Also I have always used a car broker and that saved me a lot of money plus I didn't have to haggle.
I bought my 2013 kia Rio brand new. For $12500. Had the car 11 years. Been paid off since 2017. I am still happy with my car. Been good to me all that time. Of course it's showing it's age. But I will NOT do $47lk cars
The $30k I owe on my car is at 4.1% APY and the $30k I put into 1 month Treasury bills are paying me 5.4%, which still is a profit even after taxes. More importantly, I have $30k that will help me survive for longer if I were to lose my job tomorrow.
We got our only car new in 2020. $520 a month at 2.49%. Chose to take a loan instead of paying cash in full. Our car didn't hold us back. We were still able to purchase our second house a year later (with a mortgage) on one income in a high cost of living area.
Austin, I watch your videos now and then, but I am subscribed. You and I think alike financially. I am in Portland, Maine. Do you come to Maine? I pay in full habitually. You're right, no car payments. However, what makes my vehicle more valuable, is that I sleep in it. That means no rent payments, no electric, and so forth. Great channel! Continue to trumpet your wisdom into the ears of the poor. Jesus, in the Gospel of Thomas, says that poverty lives in you if you do not know how to create for yourself. From his teaching, we could also say that wealth dwells in you if you implement these principles of wisdom which you articulate and present so beautifully.
Paid mine off 4 years ago, paid it off in 3 instead of 5.. Saved the money I would have made in payments along with extra, so next time I go to buy one, I can pay cash for it. FREEDOM!
Company car ~ $350 month , includes. "unlimited" fuel, wash and windscreen washer fluid fill ups. Used to drive 2007 Ford until i had to take company car , but it's still a quite efficient way to drive a new car. Leasing fee for similar would fee at least $500 alone.
Best advice I got was to research a reliable car, learn to perform simple to moderate maintenance and always save to pay cash. I have always bought immaculate condition 2nd hand cars that I still own, maintain and drive without owing anyone.
Never had a car. The public transport in Germany is every 5 mins and costs 49€ a month unlimited travel. Bus train tram anywhere in the country and borders of the other 10 countries
I enjoy cars and I’m working at building my wealth so my preferred method is to rent out nice vehicles for special occasions. That way I get the experience of the nice car for a couple days and then give it back. This allows me to utilize my paid off car to the fullest
A lot of people make the mistake of buying too much car. I certainly did in my 20s and it’s one of the biggest financial mistakes. However, lessons learned. I drive a ten year old car that I paid for in cash. No debt beyond mortgage. I feel sad to see a 26 year old make the too much car or truck mistake and struggle with the payments on top of the gas and insurance. It’s almost like a rite of passage but the numbers are double from when I was 26!!!
Learning to maintain your car and have no payment are the two best ways to improve your budget. Oil changes are very pricey, replacing brake pads is also very expensive, but you can literally do these two things for 1/4th the price by learning to do it yourself.
I bought my used 2006 Honda CRV over 3 years ago with cash. All other repairs have been through good mechanics I know of instead of paying next to a fortune at the auto shops.
True, good advice my 2012 Highlander is paid for and this weekend I'll save 500 bucks changing my own brakes, rotors, and oil. I get the good stuff and an oil change cost me 38 bucks and yes I could do it cheaper.
In 2015 I traded in my 2006 car and purchased a 2014 car with a final price tag of 13k I wrote a check for it and still have it. That my friend is freedom.
A paid off car is a good idea for the average middle-class with a 9-5 job. However, investors park their money into income producing assests that appreciate in value and then use use that cash flow to pay off liabilities that depreciate. I finance all of my cars.
Also, if you defaulted on a car loan payment, many times, your car will become's bank property and towed away. it's no longer yours. if you paid fully for your car, it is 100% yours and you owe no one for it.
I almost bought a new car! (I know better) my husband told me no. I paid off my Lexus GS 3 years early. I just had to buy a new battery for my car $200 unexpectedly. Thank you for your videos.
Yes, yes, yes. Now in my early 60, I retired last year. The best transportation advise, I would give anyone age 25, 35, 45, 55, or 65, is to only buy a quality "used" automobile and if, possible at the time of purchase to pay for it fully in "CASH". Trust me, this will make both your current and future financial life so much better. The only error that, I noted in this video is with the loan interest rate you cited for either a new or used automobile from between 48-months (4-years) to 72-months (6-years). Because for the past 40-years, I have never had to pay more than eight (8)-percent for either a new or used car loan. My advise to persons looking to buy either a new or used automobile is to first check rates at a couple of Credit Unions, Banks, and Savings & Loans. Then apply for a pre-approval at the two with the lowest vehicle interest rates. Once you receive your two approval letters, please remember to take them with you when you are out shopping for your car (smile ... smile).
I found out very quickly how much money you can save avoiding a car when my company transferred me overseas. Sure, I was forced to use car hire and public transportation, but that cost pales in comparison to the loan and maintenance costs (the true hidden cost of vehicle ownership).
Not having a car loan, for me, means I drove an older car which had expensive mechanical failures., several times a year. As well as not having access to the car while it's being repaired. In my experience, one must seriously consider repairs on an older vehicle I personally feel way more secure with a newer vehicle than an older one that might break down at any moment.
Hail damage totaled out my ‘15 Accord v6. I paid $16,500 for it in 2019. Insurance paid out $13,300 and I keep the car. It is SO tempting to sell it for $10k and use the $23k to upgrade. It FEELS like free money. But I’m resisting. Pro tip: don’t test drive the new Model 3 Long Range. It’s too good. 😂 Makes my 0-60 in 5.9 seconds Accord feel like an absolute sloth. And the Autopilot is incredible. Resist resist! 😂
I own both of my cars outright an dit does help me divert that money into investments. Insurance costs are out of control as well, so it makes this all the more important.
I agree with this video, and I know this is a frugal finance channel, but this topic could bring up the larger picture of all the externalities of owning a car like pollution, carbon footprint, car maintenance, and very expensive road maintenance that tax dollars go to. I'd much rather have the freedom to travel without car by foot, bike, or public transport. It would be better for health, environment, and wallet. I watched a really interesting video by CityNerd on this topic.
Paying interest on a vehicle is (unnecessary) WEALTH TRANSFER between the consumer and the lender. Once you pay your car off, save/invest for the next one (make a payment to yourself!). YOU become your own bank!
100% agree! This is exactly what I have done. The last time I made a car payment was in 1997 because as soon as I paid off that vehicle, I immediately took those payments I had been making, opened a separate investment account for the sole purpose of purchasing my next vehicle, and made those payments to myself in order to pay cash for my next vehicle which is exactly what I did. No more monthly car payments, no more paying interest on a lengthy car loan. It is far better to earn interest than pay interest!
I paid off my car this year in january almost a year earlier than i was scheduled to, the secret was to make what is called a principal payment on the loan, i did that and it was like i paid 10 payments at once
I bought a 2015 SUV, I have no kids. It seemed like a good deal, I was not buying a new car, it is in good conditions, etc. The thing is I had to borrow a part to pay it, and now I see how MUCH gas it consumes only for myself. I'm considering selling it only after two months, before it depreciates more. I've been following you Austin and I thought I should use public transportation only (and move near by my job), but after this video I'm not sure anymore. Maybe trading it in, but I'm afraid I won't really find a cheaper car for less than what I borrowed. Should I just suck it up and pay it? It's my first "big" debt and giving me so much anxiety, even agressively paying it.
I've always bought used Toyotas and my wife and I always had an extra vehicle as a backup just in case. Been working from home since 2020 and two of these vehicles get driven less than 500 miles each per year... seriously (We usually drive the most fuel efficient vehicle together). Both bought with cash, super cheap Registration and liability only insurance and I do the maintenance -- so maybe $300 in ownership cost each per year. I'm seriously considering selling both if these vehicles and just buy an E-bike.
I manage to get my transportation payment to 0. I live in nyc so we take the subway and I found a technique to bypass the turnstile so free ride everytime.
Greetings from Spain, Austin. New environmental regulations are forcing us Spaniards to get rid of old cars. Government is making things difficult to owners. Sooner or later, we have to sell the car because we're no longer allowed to drive them in the city. Mine is a reliable Toyota diesel engine. I haven't got any intentions to sell it a buy a washing machine with wheels.
No car payments here. My last 250k vehicles, that I did fiance, were only $10k at 3.5% interest. I still have one of them. I only finance hood reliable vehicles with 150k miles that have been taken care of. Then I take care of them. That has helped me stay in my modest home and save for retirement. If I would have bought very expensive new cars in the past, I wouldn't have a home or savings. No thanks. Subscribed
I've always paid my cars outright. They are second hand (usually 3 years old) although the one I have now was 5 years old when I bought it. I make my decision based on how much I want to spend. I really wanted a Volvo but wasn't willing to pay the price, so I opted for a BMW X1 instead. Before this I always drove Saabs, unfortunately they don't make them anymore. 😐 I only buy what I can comfortably afford and it feels good.
The way that cars are run and purchased is changing rapidly in the U.K . Electric cars , will be the main mode of fueling your car. I have visited many dealerships in the last few weeks , buying a gas or as we say in the UK petrol car from new is nearly non existent most are hybrid or totally electric , parts for older cars are being phased out or becoming expensive to buy , insurance for petrol (gas) is also increasing , the dashboards in these cars is like something from star trek . Charging an EV is cheaper . Yes buying an EV is expensive at present , but running one is vastly cheaper , eventually they will be on the same level as a new petrol vehicle . It is a big risk in buying a cheap gas fuelled car in UK as it will be generally more expensive to run , if you buy one for a sum of £10,000 today it could be worthless in 5 years . Car life in UK is not as straightforward and more complex at present . However , I agree with not getting a loan or finance for a car as i have learned the hard way on that one .
