Cars. We all need them, but what puts us in the position to where they actually own us? Let’s discuss four points on how you fall into this position and how to get out.
In this day and age, it can be very easy to justify a car you should have but end up where your car owns you. Let me share with you four important ways to beware that your car may own you.
Often times, we justify these purchases due to safety, cost or business. The truth is cars are a liability, not an asset. They only depreciate in value and cost money.
Today, let’s explore four ways to evaluate if your car owns you rather than you being in charge.
You Can’t Afford the Payments
Actually, we could stop right here. The fact you have payments means you can’t afford the car as the title is in the hands of the lender rather than your own.
I’ve even seen car payments that dwarf rent payments–not to mention all the additional costs that come with having a car. The point is, if you’re struggling to make the payment every month, this is a definite sign your car owns you!
You’re Worried About What Other People Think
A car you can’t afford isn’t the only sign your car owns you. You could simply drive a more affordable car or even a beater but are concerned with what people think.
If that is the case, you are being owned! Stop trying to impress people with what you drive. In the long run, it doesn’t matter. Take control of your financial situation, make the decision that is wisest for you, and leave those people in the dust.
The Repairs Exceed the Value of the Car
No matter what the car is worth. If you’ve reached a place where the repairs exceed the Kelly Blue Book value of the car, the car owns you.
We had a car that blew its first engine at 89,000 miles despite us having bought it brand new. We sank approximately $3800 into it because it was still worth about $9,000. Five years and 50,000 miles more, guess what happened? The second engine blew.
That car turned out to be a money pit and there were definite red flags on display. Pay attention to the signs in order to avoid keeping a car that actually owns you.
Conversely, when our Honda Civic’s transmission went at 190,000 miles, we decided to put in the $2700 needed to replace the transmission despite the car’s value of $3,000. It was worth it. It was such a reliable car that it was worth the money!
One great resource to maintain is a relationship with a quality mechanic. For more tips on this important relationship, check out “How an Independent Mechanic Saves You Money.”
The Taxes Are Half Your Housing Costs
Almost half of our fifty states have vehicle property tax. Not sales tax but property tax. The other half of you are either aghast or confused right now. Let me explain.
These are taxes that give you the privilege to drive and store your vehicle on land within that state. That is it!
If you find your yearly car taxes adding up to more than a few hundred dollars, it is likely your transportation is just too expensive.
Take a hard look at what your vehicle is costing you. You may be surprised. For more on this topic, be sure to check out “8 Vehicle Costs You Need to Plan For.”
If Your Car Owns You…
It may be time to sell your car! Offload this huge liability and purchase a quality used car you can trust and afford.
If you’re stuck in a car loan, meaning you owe more than it’s worth, sell it to a private party so you can get the most for it. Then, secure a personal loan for the difference in order to release the title to the new owner.
Question: Are you checking off one or more of the above list? Are you stuck in a loan for a car you can’t afford? If you answered “yes” to either of these questions or you feel overwhelmed or confused, I’d like to help. Set up a free consultation with me today so your car no longer owns you and so you can find more money to fund your dreams!
Additional Action Items:
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