I own a auto repair shop and used car lot. I’ve been in the business for 20 years. NO ONE needs to spend 20-30k for a vehicle. If you can find a good used car lot that you can trust there is no reason to spend more than 5-10k for a vehicle. After you pay 5-10k cash for the vehicle you save $25 per week for a car fund. If you need repair work done you now have a fund for that and if something bad happens to the car you will have money saved for a new car.
I bought a Toyota Camry estate with 152,000 on the clock. Drove it the whole way around Australia and added 50k. Serviced it regularly and the only thing I had to fix was a punctured tyre. Best car in the world and cost me $2000
I appreciate that Dave does acknowledge with most of this, the math is not on his side. Personal finance is first and foremost behavior, and he is mostly correct.
I bought a 2003 Lincoln town car, for $6k, clean car fax, one owner, 60k original miles, I fixed the transmission for $1k and after 65k miles zero problems! My 2012 Corolla S after 100k miles is killing it! Buying a new car for $30k-$60k it’s insane. Let’s get things done with what we have!
I have been tempted to get a brand new car so many times, bought a 2006 subaru from a friend. It has 250k miles (i added 50k) and still runs like a dream. I am saving up for a newer car but Im paying cash for it. while this one runs and it gets the job done I will keep saving money.
Yes! This is what I do. I save $175/mo for a car, every month, no matter what. I pay cash for my cars. I’m never stressed about it. I also put away 30/mo for maintenance in a sinking fund and always have money for anything that comes up so auto maintenance or repair is never an “emergency”.
Bought a 1,200 dollars for a 2004 Chevy, no monthly payment. Going 3 years now, still running pretty well. Almost 300k mileage. But saving to buy a decent car soon. Toyota RAV4 here’I come.
Mz Tweety It was about 5 yrs ago. I think it was the engine. Til then only had oil leaks that i fixed. But about 2 mos before it died, took it to a shop to fill up with oil and mechanic commented that it looked like all orig parts. Told him i never got any parts updated or replaced, just literally oil changes every 3000 miles. He said he didnt know how nothing broke down sooner and said he was concerned to replace anything or else might need to do alot.
If it’s gonna take you 5 years to save up for the car you want, you’re buying too much car. It shouldn’t take you more than 1-2 years to save up for a car you can afford.
That’s pretty general. I’ve got two Toyota’s. one I’ll keep another 4 years the other I’m keeping 7. Why would I not save now for 4 years in the future I have no payments
Dave is right about so much but so wrong about active vs passive management. the point is not that your choice to do active vs passive is the key determinant of wealth building - nobody says that. the point is that you will do better with passive and its pretty easy to do, so why not?
Just open a deposit, and add up every month. Once you have what it takes plus an emergency fund, just do it. You order the car, wire the money once it gets delivered, drive away, no worries but the gas and the insurance. No brainer.
Never buy a depreciating asset, number one Ramsey rule. This guy is just dumb with his money when he could get a van for 5000 bucks that gets the job done.
Buy the cheapest car that you dont mind being seen in when your debt free. 20 to 30k way to much if it's taking that long to save up for a car...you can buy many nice used cars with around 60k miles or so for $15k or less. Stick with reliable brands and models...Toyota and Mazda, Honda....keep for 10+ years and 200k+ Miles and repeat.
@@neptunefitness1866 Yea the newer ones are mines at 100k miles and not one issue compared to my Rav4 that had several big issues before 100k miles. The 2.5 skyactiv motor is rock solid many that are in high 100s little to no issues. I'll keep mine till over 200k miles before I sell.
@@mohamedeltouny17 Older than say 2013 maybe...from 2013 to now Mazada is right there with Toyota in reliability. Most Japanese cars are good actually....well except Nissan.
Ten years I started saving for a car. Just bought stocks of well to do companies. My Mini still keeps going. Funny thing I have such a pile of cash now I could buy two cars. I can't make myself sell the porfolio for many reasons. The biggest one of them I became cheep. I wasn't like that when I financed cars and hauled payment to the band every month. LOL
Bought a 2003 Mitsubishi ellipse for 800 in 2017 and it is still running great in 2022. In fact have been offered 2k for it 🤷🏻♂️ just shared since everyone else was
Forester with 72K mile. Looking to get 180K plus with it. 108/17k miles yearly means I have about six years to save for a car.$400 month times 72 equals about 28000 to get a new car in the future. Debt free at right now so I can do this, wish I listened earlier.
Best maintenance tip would be to forget those 7,000-10,000 mile oil changes recommended by the manufacturer. Oil is cheap compared to a new engine or timing chain. No more than 4,000 with dino oil; 5,000 for full syn.
Rich Ramirez the first error you have ever done in buying a long term car is buying a ford, most especially an explorer. That’s one of their worst vehicles ever made.
People view buying used car as a “compromise” or an unattractive decision when compared to a newer car. The mentality that you need the newest and greatest is a mindset that will always hold you back. Think about car buying logically and you’ll save yourself emotionally.
to be fair, when buying a car new with zero miles, you’re not really taking a chance. you can almost guarantee that it will work and get you from work, home, or wherever else you need to be reliably with no issues as long as you stay up to date with the maintenance. buying a used car is such a risk these days, even from “credible” dealerships. even service reports aren’t even accurate and leave a lot of important information out.
@@GOEMDEEGO Sorry that is not true. Buying a new car is more risky because there is no track record of how this version of the car has been doing in the real world because you are buying the car before enough information is available. Every year's model has its own share of known issues that become known over time. Lets say you are buying a car that is known to be reliable, like a Toyota Camry, its going to be just as reliable at 100K miles as compared to 0 miles. Those cars run well for 15-20 years if you take care of them. The added benefit of a used car is you can research how reliable that model was since a lot of people have used that version and can share their experiences. Regardless, you have to inspect the car, have a trusted mechanic take a look at it, and see that the servicing was up to date, etc. After you do that, theres no reason to say a used car is less reliable. Its just a justification for wanting something new and not wanting to feel stupid about it
The only time a car is not worth buying used because its inherently less reliable, is if the car was of crappy quality to begin with. In that case it would fall apart after some use and would only be reliable when its new. Which begs the question, why u would want to buy such a car in the first place?
@@IWAC2013 the issue is verification and accurate reporting in the first place. most used cars don’t have detailed service records, a lot of details go unreported, and there are even loopholes to avoid a accidents going on the record and a salvage title. people go through the trouble of clearing codes, messing with the odometer, doing half ass repairs to silence parts during a test drive, people going out of their way to conceal significant body/frame damage & rust. you really don’t have to worry about any of that with a new car, and your chances get even better when you stick to the makes and models that are known to be consistently reliable.
@@GOEMDEEGO While I do agree that these dirty tricks to conceal issues are certainly a problem to watch out for, you are not going to deal with this problem just from the mere fact that its a used car. It depends on the circumstances. If its a shady used car dealership you're dealing with, then yes stay away. If a dealer is not okay with you having the car checked by your mechanic, then stay away. But not everyone is like that. There are honest people out there who just want to sell their car and want to get a profit for it. But you need to do your due diligence. It is so important to have the car inspected by your own mechanic, test drive, inspect the car yourself, etc. Is it easier to buy a new car? yes. Its less hassle and you dont have to put any effort or know anything about cars. The problem is that the value plummets within a few years and you're not gaining reliability of the car itself. If that car was halfway decent, it would be just as reliable after if was driven for a few years. You can buy a new car if you want to, its just not the best decision financially speaking. And at the same time, the reliability factor is really a non-issue if you do your homework. It takes some effort but can save you thousands of dollars and headache.
imagine u save up $25k for a nice car & pay cash... then a week later some idiot hits u and the car gets totalled. What happens if insurance says the car's worth $21k and thats the check they write u? Ik what dave says but tbh I wouldn't let go of that much cash all at once... just dont finance a $65k car for 84 months when u make $50k a year 🤦♂️
People always say buy a Toyota or Honda, which is great. But the real best budget car is a used Hyundai. I had a 2002 sonata with 240k miles and it was still going strong when I sold it
I have a 2011 Hyundai sonata and it's still going strong.. but there are a lot of recalls on it lol! But the dealership fixes it for free so I don't mind.
Sarah Wagner I haven’t experienced that thankfully! I currently have a 2012 Hyundai Accent and haven’t had any problems yet, I’ve owned it for 2 years now
*Dave when talking about consumer products*: search to find a cheap and reliable deal. *Dave when talking about investing*: don't worry about expensive fees! It's all good even though most mutual funds don't beat the market net of fees. Don't get the cheap and reliable deal of a simple index fund.... But hey. Smartvestor pro's have to make money one way or another right ? 😅
I think you are missing his point that being Americans have NO savings but whopping DEBT. So he does makes sense: don't get soaked on the consumer end - Americans consume like nobody"s business and start saving don't use fees as a reason not to. If a person over pays in fees and gets a low interest rate at least they break even and have savings - as opposed to no savings and a lot of car debt.
My 2013 Jetta is valued at about 4K and I love it. Leather seats, sunroof, Bluetooth touch screen media player, heated seats, tip-tronic, 170hp 5 cylinder engine. By used!
Analysis paralysis is very common with intelligent people such as doctors and engineers. They spend a bunch of time analyzing rates of return and fees and taxes and then months or years later they still haven’t invested any money in the market. The market might have increased 15% or more but they are still analyzing potential outcomes. They might as well stuff it in their shoe and watch TV. I used to work in financial services and emotional and psychological issues are why most people don’t grow their wealth. I got tired of trying to motivate people who had no financial plan and refused to take actions on a plan.
So true Brian, but it can be an enjoyable game. lol I would just find one of those higher interest savings accounts to save for a car (I think E-Trade is 1.75% and I think there are some higher ones), definitely not enough to keep up with inflation, but easy and secure for a closer purchase.
I forget where I read this (may have been malcolm gladwell) but when employers offer many different health insurance packages, the employees are less likely to choose one at all because they take too long to decide what is the “best” one.
I lived next to a retired engineer who prided himself on the fact that he never bought a new car. In fact he bought a used police car when I was living next to him. He also marveled at a $100 bill that he got from selling off stuff prior to moving. He said he hadn't seen many $100 bills.
Walking in to the stealership with cold hard cash (or check) gives them a lot more leverage to purchase that brand new car way below MSRP with “out the door” pricing. Pile the money up first. Walk in there and dominate the sales floor.
I was told to negotiate the price before talking about how you're paying for it. A lot of times the car dealers want to make their money on financing the car and will *raise* the price if they think you're paying cash.
Dealerships want you to finance. When they see cash they almost want to walk away, and then when you tell them no to the additional warranty they want to shoot you.
Eddie Wow they actually don’t want cash, they want you to finance. They make more money that way. They also make a ton of money on warranties. They’re a rip off.
Just put the money in short term government bonds (1 to 3 years) that way you earn some interest on the money and time the bonds so that they come due around the time you plan on buying the car / minivan
If you don't think it's possible to beat the S&P, then just invest in index funds. Fully fund your 401k (currently $19k per year) and Roth IRA ($6k per year), and put 100% of it in low fee index funds. If you do that your entire working life you'll still end up a multi-millionaire. It's not the best approach possible, but it'll do just fine.
I'm all about paying cash for a car now instead of financing, after doing it once I don't plan to finance again the payments aren't worth it when I can just save up money in 4 years the same amount of time it'd take to finance it and have it paid off immediately in full and not pay any interest since I wouldn't be financing. I plan on paying off my current car early.
ill buy my honda type r when my house is paid off , no debt and have retirement prepped and have my kids school money ready but for now I love my 2007 honda civic
Tesla, no engine , no trans so oil change hello no maintenance, 8 year warranty on the battery & free super charging plus a 1 800 federal tax credit and if you live in California 2,000$ from the state plus you can drive for 3 years in the carpool lane without anyone else in the car.
Needing 5 years to make an extra $30,000 for a vehicle is absurd. The "Financial Literacy" on employing the "earned income" to create more money to buy & save time is the problem.
Lol funny this video comes up and myself and my wife were just talking about saving up for a car since we will be needing one soon. Happy holidays everyone:)
Dave Ramsey has taught me that all people who disagree with Dave Ramsey are goobers that live in their mother's basement, and I shouldn't listen to them.
If 74% of the reason people succeed at investing is bc they actually invest and not bc of ROI or fees, then why pay a guaranteed fee to POSSIBLY get a slightly higher return? Index funds seem like the way to go unless you can pick the unicorn mutual funds. I LOVE Dave but disagree with the mutual fund advice.
Ok everyone. I need some advice. I've never read Dave's books but love watching his lessons on here. Me and my wife are debt free other than the house. We live below our means. My house payment is 900$ and the rest of our bills are less than $500. We take home about $5500 a month. (I'm a plumber and she works in an office) our cars are paid for. My Question is that I really, really want a NEW truck. I dont need a 60k truck, but I need something to drive, haul for the house and haul for side jobs. I've been saving up cash to pay for it. Would dave approve buying a new truck if I paid cash? The trucks I'm looking at are about 30k. I've saved up about 18k as of now and will have enough in the next few months. I plan on keeping this vehicle for life. Would it be better to throw the money at the house?
I would get that truck with the bells and whistles. I bought a new base Sierra 1500 pick up with a V-6. And I would say that it was the worst vehicle I ever owned. I came from a Silverado with an LS trim and Z-71 off road package. And the few options that the Silverado had, like a V-8, better suspension, steering wheel controls, and power folding side mirrors, I miserably missed on the Sierra. I traded that Sierra in after not even 3 years, and bought a new Silverado LTZ with Z-71 package during a year end promotion offering "employee pricing." Best decision ever. You only live once; and if you are working in a trade, you deserve it, in my opinion. The list on my Silverado was $52.300.
@@AStanton1966 GM lost me with the bailout. I really dont want the bells and whistles and dont need a moster engine. I value reliability more than anything honesty. I've test drove a few F150s, base 3.3 with 4x4. Tows 7k. We have a few at work and they are great trucks. Imo the less tech the less that can go wrong.
@@alyssia444 Its been a back and forth decision. If the vehicles we have now weren't falling apart I'd definitely throw it at the house. I'm missing out on a lot of bigger side work just because I have to rent a truck to move material. Our newest car is a 2004.
I have a question.. let's say I make 35-40 a year and I have no debt and I want a brand new vehicle civic type r or tundra, and I plan on keeping it for the long haul, would that be a good decision?
A 401k is through your employer, and an individual retirement account. So the IRA is a separate investment vehicle. The max contribution for a Roth or Tradition IRA is $6,000 and the max for the 401k is $19,500.
@@colinzwiebel6770 - So, you can open a separate account and put up to $6,000 in it per year (at least for 2020) on top of the $19,500 for the employer based 401(k) for a total of $25,500? I assume the $19,500 limit includes employer contributions as well?
Khaltazar - there is an income level restriction, if you make more than that amount you can’t participate in a Roth IRA. But if your income qualifies you, you can put in up to $6,000 as of this year. That has nothing to do with your 401k through work. You can contribute the $19,500, which would NOT include any employer matching. Most people should put in as much to get the full employer match (which is free money), then start contributing to Roth to get the tax free growth!
I have tremendous respect for Mr. Ramsey's advice and plans. But this question does point to a gap in his approach. He's so blinded by long-term mutual funds, he ignores individual stock holdings. In this case, my approach for short term savings is to invest in a high-yield dividend stock, with a very reliable (boring) company - like IBM. A $10K investment will yield $1k annually. Much better than any checking or savings account interest. As long as the company is a good/careful/conservative choice - look to earn some income from a dividend, amigo.
His comments about the Roth IRA are not thorough enough. If you get your children to invest in a Roth IRA when they are young and they are not paying that kind of tax rate they will have quite the investment later in life. The Roth IRA is a tool that can be used in many ways so you got a look at all the angles. Also if you’re making a ton of money later and you pull money out of a traditional IRA could push you into a higher tax bracket. I think it’s a little bit more to it than what he saying
Hey Dave. How would you save if we’re accounting for inflation? I feel like worst case.. saving in a growth account for that long would at least off set the loss of purchasing power in the dollar over that time. Just my thought, I’m no expert! Have a great day everyone
How much did his car payment used to be? Say it was $300/month. Put that away and that’s $18,000 in 5 years. Put $2,000 down and boom: there’s your $20K.
I guess my main issue is why bother talking to Dave about that? Lol. If you have a number goal, save up to that goal. And don’t invest short-term. Just save it up and call it a day.
In five years, a used vehicle’s value isn’t going to go up so astronomically that $20,000 won’t get him something reliable and of decent size. A car isn’t a property, so it wouldn’t work the same way lol.
I’m always envious off people with nice cars then I remind myself there most likely in debt with it then I’m not so impressed by it 😂
Listen to those same ppl complain about car notes/payments takes that envy away real fast
Truth.. and check out craigslist.. you'd be surprised how cheap those cars are a few years later.. it's crazy, the drop in value.
Few of those cars are owned...how do I know. Looking for those cars just 3 to 4 years old, very few are sold private owner.
When I see a nice car I see a monthly payment !
They’re* most likely
I paid $900 for my 1999 corolla, I used it on my mail route and put 20k miles
Still runs a year later
Are you Scotty Kilmer?
@@AStanton1966 ☠☠😂
@@AStanton1966 laughs in hoarse
well it is a corolla...
Did the Postal Service make you use your car? How do you use a car with left hand drive and no bench seat?
I own a auto repair shop and used car lot. I’ve been in the business for 20 years. NO ONE needs to spend 20-30k for a vehicle. If you can find a good used car lot that you can trust there is no reason to spend more than 5-10k for a vehicle. After you pay 5-10k cash for the vehicle you save $25 per week for a car fund. If you need repair work done you now have a fund for that and if something bad happens to the car you will have money saved for a new car.
4 years later...good luck finding any new car less than $35k.
@@kenfrank2730 most hyundais are less than 30k new
I bought a Toyota Camry estate with 152,000 on the clock. Drove it the whole way around Australia and added 50k. Serviced it regularly and the only thing I had to fix was a punctured tyre. Best car in the world and cost me $2000
2000!
Well its a toyota so this doesn't suprise me. Toyota reliability is no joke.
I appreciate that Dave does acknowledge with most of this, the math is not on his side. Personal finance is first and foremost behavior, and he is mostly correct.
I bought a 2003 Lincoln town car, for $6k, clean car fax, one owner, 60k original miles, I fixed the transmission for $1k and after 65k miles zero problems! My 2012 Corolla S after 100k miles is killing it! Buying a new car for $30k-$60k it’s insane. Let’s get things done with what we have!
I have been tempted to get a brand new car so many times, bought a 2006 subaru from a friend. It has 250k miles (i added 50k) and still runs like a dream. I am saving up for a newer car but Im paying cash for it. while this one runs and it gets the job done I will keep saving money.
...and 1 day after you buy that car, begin saving for your next car.
I hate this because it’s so true
M T why
@@PrincessYonna1 by the time it wears down and is too broken for fix. Or crashed. Etc. You'll have money for a new car.
Yes! This is what I do. I save $175/mo for a car, every month, no matter what. I pay cash for my cars. I’m never stressed about it. I also put away 30/mo for maintenance in a sinking fund and always have money for anything that comes up so auto maintenance or repair is never an “emergency”.
@@andrearothe4859 great idea saving for maintenance. Why are people surprised when they need new brakes, tires, fluids, battery etc?
I'm a member of Basement Dwelling Doobers Local 601 and you will be hearing from our lawyer
harrison wintergreen underrated comment 😂😂😂
Here here!!
W
Whoa!
🤣🤣🤣🤣
1) toyota or honda 2) paid with cash 3) run up 500k miles before tossing. 4) debt free
Lambos and raris only
Joshua knows whats up
Scotty?
But you really want to support auto makers that are over seas? We should all only be buying american
Cant be living like a broke boi, get your bands up cause this isn't the life u wanna be living
I just bought a 1994 GMC Sierra 4x4 for $3500, 113,000 miles, runs and drives perfectly. Tabs are $52 per year, insurance is $28 per month.
What's the insurance? I'm pretty sure that cost is a very good deal
Bought a 1,200 dollars for a 2004 Chevy, no monthly payment.
Going 3 years now, still running pretty well. Almost 300k mileage. But saving to buy a decent car soon. Toyota RAV4 here’I come.
Hey bro, did you end up getting your RAV4?
Had a Toyota camry...lasted 230k. Only needed oil changes. Drove it til it stopped rolling.
Why did it stop rolling? Just curious
Yea quite easy with a Toyota
Mz Tweety It was about 5 yrs ago. I think it was the engine. Til then only had oil leaks that i fixed. But about 2 mos before it died, took it to a shop to fill up with oil and mechanic commented that it looked like all orig parts. Told him i never got any parts updated or replaced, just literally oil changes every 3000 miles. He said he didnt know how nothing broke down sooner and said he was concerned to replace anything or else might need to do alot.
If it’s gonna take you 5 years to save up for the car you want, you’re buying too much car. It shouldn’t take you more than 1-2 years to save up for a car you can afford.
He probably could get it earlier but might be putting money elsewhere
That’s pretty general. I’ve got two Toyota’s. one I’ll keep another 4 years the other I’m keeping 7. Why would I not save now for 4 years in the future I have no payments
That's right. I've never spent more than two months of salary on a car purchase.
@@dank.2536 Sounds like a good rule of thumb. 🤔
I think the idea was that they already know they'll need a new car in 5 years, so why not start saving already.
As a carguy I'm stupid enough to buy a car as expensive as a house. But Dave speaks sense to me. R8 must wait ...
I am equally stupid, Murcielago you will wait
I'm double as dumb I'd take both. Wise man once said ya can sleep in your car but ya can't race your house!!
@@jupiterone2548that’s hilarious 😂
Dave is right about so much but so wrong about active vs passive management. the point is not that your choice to do active vs passive is the key determinant of wealth building - nobody says that. the point is that you will do better with passive and its pretty easy to do, so why not?
Just open a deposit, and add up every month. Once you have what it takes plus an emergency fund, just do it. You order the car, wire the money once it gets delivered, drive away, no worries but the gas and the insurance. No brainer.
Never buy a depreciating asset, number one Ramsey rule. This guy is just dumb with his money when he could get a van for 5000 bucks that gets the job done.
Buy the cheapest car that you dont mind being seen in when your debt free. 20 to 30k way to much if it's taking that long to save up for a car...you can buy many nice used cars with around 60k miles or so for $15k or less. Stick with reliable brands and models...Toyota and Mazda, Honda....keep for 10+ years and 200k+ Miles and repeat.
Have a mechanic look at it.
Mazda’s aren’t reliable. Pffftt.
@@neptunefitness1866 Yea the newer ones are mines at 100k miles and not one issue compared to my Rav4 that had several big issues before 100k miles. The 2.5 skyactiv motor is rock solid many that are in high 100s little to no issues. I'll keep mine till over 200k miles before I sell.
Stay away from MAZDA ....repeat NO MAZDA
@@mohamedeltouny17 Older than say 2013 maybe...from 2013 to now Mazada is right there with Toyota in reliability. Most Japanese cars are good actually....well except Nissan.
Ten years I started saving for a car. Just bought stocks of well to do companies. My Mini still keeps going. Funny thing I have such a pile of cash now I could buy two cars. I can't make myself sell the porfolio for many reasons. The biggest one of them I became cheep. I wasn't like that when I financed cars and hauled payment to the band every month. LOL
Bought a 2003 Mitsubishi ellipse for 800 in 2017 and it is still running great in 2022. In fact have been offered 2k for it 🤷🏻♂️ just shared since everyone else was
I’m selling everything to live under the bridge debt free. Thanks Dave!
Hahahahaha
Lol
Forester with 72K mile. Looking to get 180K plus with it. 108/17k miles yearly means I have about six years to save for a car.$400 month times 72 equals about 28000 to get a new car in the future. Debt free at right now so I can do this, wish I listened earlier.
Got a 2000 Honda Accord with 55k miles on it got it for 5,000$ runs amazing and I will be able to have it for 10+ years before I need something new
Just buy one! Took me three years, bought a really nice Chevy Malibu for 4,500 cash. 2 yrs later still going strong.
I bought my 2003 Toyota Tacoma new for $18k. It's still my daily driver 21 years later. Over that time I spent around $2500 in maintenance.
I driving an 08 explorer with 190k on it. Ol Betsie is still ticking though she is showing signs of the end.
Best maintenance tip would be to forget those 7,000-10,000 mile oil changes recommended by the manufacturer. Oil is cheap compared to a new engine or timing chain. No more than 4,000 with dino oil; 5,000 for full syn.
Rich Ramirez the first error you have ever done in buying a long term car is buying a ford, most especially an explorer. That’s one of their worst vehicles ever made.
People view buying used car as a “compromise” or an unattractive decision when compared to a newer car.
The mentality that you need the newest and greatest is a mindset that will always hold you back. Think about car buying logically and you’ll save yourself emotionally.
to be fair, when buying a car new with zero miles, you’re not really taking a chance. you can almost guarantee that it will work and get you from work, home, or wherever else you need to be reliably with no issues as long as you stay up to date with the maintenance. buying a used car is such a risk these days, even from “credible” dealerships. even service reports aren’t even accurate and leave a lot of important information out.
@@GOEMDEEGO Sorry that is not true. Buying a new car is more risky because there is no track record of how this version of the car has been doing in the real world because you are buying the car before enough information is available. Every year's model has its own share of known issues that become known over time. Lets say you are buying a car that is known to be reliable, like a Toyota Camry, its going to be just as reliable at 100K miles as compared to 0 miles. Those cars run well for 15-20 years if you take care of them. The added benefit of a used car is you can research how reliable that model was since a lot of people have used that version and can share their experiences. Regardless, you have to inspect the car, have a trusted mechanic take a look at it, and see that the servicing was up to date, etc. After you do that, theres no reason to say a used car is less reliable. Its just a justification for wanting something new and not wanting to feel stupid about it
The only time a car is not worth buying used because its inherently less reliable, is if the car was of crappy quality to begin with. In that case it would fall apart after some use and would only be reliable when its new. Which begs the question, why u would want to buy such a car in the first place?
@@IWAC2013 the issue is verification and accurate reporting in the first place. most used cars don’t have detailed service records, a lot of details go unreported, and there are even loopholes to avoid a accidents going on the record and a salvage title. people go through the trouble of clearing codes, messing with the odometer, doing half ass repairs to silence parts during a test drive, people going out of their way to conceal significant body/frame damage & rust.
you really don’t have to worry about any of that with a new car, and your chances get even better when you stick to the makes and models that are known to be consistently reliable.
@@GOEMDEEGO While I do agree that these dirty tricks to conceal issues are certainly a problem to watch out for, you are not going to deal with this problem just from the mere fact that its a used car. It depends on the circumstances. If its a shady used car dealership you're dealing with, then yes stay away. If a dealer is not okay with you having the car checked by your mechanic, then stay away. But not everyone is like that. There are honest people out there who just want to sell their car and want to get a profit for it. But you need to do your due diligence. It is so important to have the car inspected by your own mechanic, test drive, inspect the car yourself, etc. Is it easier to buy a new car? yes. Its less hassle and you dont have to put any effort or know anything about cars. The problem is that the value plummets within a few years and you're not gaining reliability of the car itself. If that car was halfway decent, it would be just as reliable after if was driven for a few years. You can buy a new car if you want to, its just not the best decision financially speaking. And at the same time, the reliability factor is really a non-issue if you do your homework. It takes some effort but can save you thousands of dollars and headache.
I love the mutual fund advice and the rate of return, just save you money 10 percent wont break the deal or make the deal
imagine u save up $25k for a nice car & pay cash... then a week later some idiot hits u and the car gets totalled. What happens if insurance says the car's worth $21k and thats the check they write u? Ik what dave says but tbh I wouldn't let go of that much cash all at once... just dont finance a $65k car for 84 months when u make $50k a year 🤦♂️
Buy a $21k car, but I doubt a car depreciates that much in a week. On a financed car you're 5k in debt with no money for a new car.
You ever heard of gap insurance?
"Hey Dave, what's the best way to save for a new car?" "Sell your car."
People always say buy a Toyota or Honda, which is great. But the real best budget car is a used Hyundai. I had a 2002 sonata with 240k miles and it was still going strong when I sold it
Shadowwind4 value?
Toyota and Honda will do and hold value a lot better.
I have a 2011 Hyundai sonata and it's still going strong.. but there are a lot of recalls on it lol! But the dealership fixes it for free so I don't mind.
Sarah Wagner I haven’t experienced that thankfully! I currently have a 2012 Hyundai Accent and haven’t had any problems yet, I’ve owned it for 2 years now
ed b don’t get me wrong, they’re great, but I feel like Hyundai gets overlooked a lot when it is a great option on a budget as well
*Dave when talking about consumer products*: search to find a cheap and reliable deal.
*Dave when talking about investing*: don't worry about expensive fees! It's all good even though most mutual funds don't beat the market net of fees. Don't get the cheap and reliable deal of a simple index fund.... But hey. Smartvestor pro's have to make money one way or another right ? 😅
I think you are missing his point that being Americans have NO savings but whopping DEBT. So he does makes sense: don't get soaked on the consumer end - Americans consume like nobody"s business and start saving don't use fees as a reason not to. If a person over pays in fees and gets a low interest rate at least they break even and have savings - as opposed to no savings and a lot of car debt.
Cars are the biggest killer of wealth!
Seems like it's healthcare, student tuition, car loans and kids.
Yes
Great point, people spend alot of money on cars to attempt to look rich
Now this is a great question that is applicable to everyone.
*using the stock market to save for short term expenses i.e less than idk 10-20 years seems rather risky* 💪🌚
Black Vito - Moneyology I see you on all of the same money related videos I watch 😂
@@MrNGTfan123 I'm working on getting too every video every created on TH-cam
Yeah I kept my yearly car insurance money in my index fund and when I told them they told me not to do that.
My 2013 Jetta is valued at about 4K and I love it. Leather seats, sunroof, Bluetooth touch screen media player, heated seats, tip-tronic, 170hp 5 cylinder engine. By used!
Analysis paralysis is very common with intelligent people such as doctors and engineers. They spend a bunch of time analyzing rates of return and fees and taxes and then months or years later they still haven’t invested any money in the market. The market might have increased 15% or more but they are still analyzing potential outcomes. They might as well stuff it in their shoe and watch TV. I used to work in financial services and emotional and psychological issues are why most people don’t grow their wealth. I got tired of trying to motivate people who had no financial plan and refused to take actions on a plan.
Yea my friends same way hasn't invested in stock market since 2011 when he felt due for correction...talk about blown time
I know people who would have barely any retirement if it wasn't for inheritances. That's poor planning in my opinion.
So true Brian, but it can be an enjoyable game. lol I would just find one of those higher interest savings accounts to save for a car (I think E-Trade is 1.75% and I think there are some higher ones), definitely not enough to keep up with inflation, but easy and secure for a closer purchase.
I forget where I read this (may have been malcolm gladwell) but when employers offer many different health insurance packages, the employees are less likely to choose one at all because they take too long to decide what is the “best” one.
I lived next to a retired engineer who prided himself on the fact that he never bought a new car. In fact he bought a used police car when I was living next to him. He also marveled at a $100 bill that he got from selling off stuff prior to moving. He said he hadn't seen many $100 bills.
Dave, if all that matters is the behavior of investing at all, why not advise people to go with a no-fee index fund over a mutual fund?
Walking in to the stealership with cold hard cash (or check) gives them a lot more leverage to purchase that brand new car way below MSRP with “out the door” pricing. Pile the money up first. Walk in there and dominate the sales floor.
I was told to negotiate the price before talking about how you're paying for it. A lot of times the car dealers want to make their money on financing the car and will *raise* the price if they think you're paying cash.
Dealerships want you to finance. When they see cash they almost want to walk away, and then when you tell them no to the additional warranty they want to shoot you.
Eddie Wow they actually don’t want cash, they want you to finance. They make more money that way. They also make a ton of money on warranties. They’re a rip off.
Steven yes however will you ever turn down a sale?
I would do that one day
Just put the money in short term government bonds (1 to 3 years) that way you earn some interest on the money and time the bonds so that they come due around the time you plan on buying the car / minivan
If you don't think it's possible to beat the S&P, then just invest in index funds. Fully fund your 401k (currently $19k per year) and Roth IRA ($6k per year), and put 100% of it in low fee index funds. If you do that your entire working life you'll still end up a multi-millionaire. It's not the best approach possible, but it'll do just fine.
I'm all about paying cash for a car now instead of financing, after doing it once I don't plan to finance again the payments aren't worth it when I can just save up money in 4 years the same amount of time it'd take to finance it and have it paid off immediately in full and not pay any interest since I wouldn't be financing. I plan on paying off my current car early.
ill buy my honda type r when my house is paid off , no debt and have retirement prepped and have my kids school money ready but for now I love my 2007 honda civic
Kind of sad that a guy's got to save for a mini van. How about a nice Dodge Hellcat? Now that's worth saving for!
You have to be in it to win it.
I love how Dave dresses like a European mob boss in track suits. Then I became 40 and weight shifted around a lot for me. Now I get it.
If Dave Ramsey should retire one day..there is absolutely no replacement for him at the horizon.
Tons of people could replace him he offers super basic financial advice lol
It's so funny how he is completely changed when mocking somebody
Tesla, no engine , no trans so oil change hello no maintenance, 8 year warranty on the battery & free super charging plus a 1 800 federal tax credit and if you live in California 2,000$ from the state plus you can drive for 3 years in the carpool lane without anyone else in the car.
But Tesla cost 57K here in Canada xD
Needing 5 years to make an extra $30,000 for a vehicle is absurd. The "Financial Literacy" on employing the "earned income" to create more money to buy & save time is the problem.
Find out what the payments would be if you financed it. Put that in the bank every month. In appx 1/2 the time you have the cash for the car.
I'm just a 21 yr old with nothing to my name and no parents throughout the years for support. Not even sure where to start for a car..
Lol funny this video comes up and myself and my wife were just talking about saving up for a car since we will be needing one soon. Happy holidays everyone:)
@Sir We Are About to Die sanenameaintchange@ go on dont wait elabrate how u feeling
You're always doing better than you deserve...
That 50 million net worth will do that to you 😂😂
My car will be paid off 2day 😊
I live in a van down by the river... but I paid cash for it.
Dave Ramsey has taught me that all people who disagree with Dave Ramsey are goobers that live in their mother's basement, and I shouldn't listen to them.
$50K+ trucks at my local Toyota dealership. Crazy!
Future Dave Ramsey callers will buy them 😂
If you don't buy it, someone else will. Especially with 0 down, 0-interest, and 84-months to pay it off.
If 74% of the reason people succeed at investing is bc they actually invest and not bc of ROI or fees, then why pay a guaranteed fee to POSSIBLY get a slightly higher return? Index funds seem like the way to go unless you can pick the unicorn mutual funds.
I LOVE Dave but disagree with the mutual fund advice.
I think there are only 2 things you need to know when investing in mutual funds: diversity and dollar cost averaging.
@@AStanton1966 more or less we all die ... u like unicorns
You tell em Dave. People gotta stop being lazy and just do it.
Scotty: best way to save up is a buy a 94 Celica 😂😂😂
Rev up your engines!
Those two need to do a videos together
😂😂😂😂
7:17 JUST DO IT!!!
Ok everyone. I need some advice. I've never read Dave's books but love watching his lessons on here. Me and my wife are debt free other than the house. We live below our means. My house payment is 900$ and the rest of our bills are less than $500. We take home about $5500 a month. (I'm a plumber and she works in an office) our cars are paid for. My Question is that I really, really want a NEW truck. I dont need a 60k truck, but I need something to drive, haul for the house and haul for side jobs. I've been saving up cash to pay for it. Would dave approve buying a new truck if I paid cash? The trucks I'm looking at are about 30k. I've saved up about 18k as of now and will have enough in the next few months. I plan on keeping this vehicle for life. Would it be better to throw the money at the house?
How much do you owe on your house?
I would get that truck with the bells and whistles. I bought a new base Sierra 1500 pick up with a V-6. And I would say that it was the worst vehicle I ever owned. I came from a Silverado with an LS trim and Z-71 off road package. And the few options that the Silverado had, like a V-8, better suspension, steering wheel controls, and power folding side mirrors, I miserably missed on the Sierra. I traded that Sierra in after not even 3 years, and bought a new Silverado LTZ with Z-71 package during a year end promotion offering "employee pricing." Best decision ever. You only live once; and if you are working in a trade, you deserve it, in my opinion. The list on my Silverado was $52.300.
@@alyssia444 we owe just over 90k. I'm 29 years old.
@@AStanton1966 GM lost me with the bailout. I really dont want the bells and whistles and dont need a moster engine. I value reliability more than anything honesty. I've test drove a few F150s, base 3.3 with 4x4. Tows 7k. We have a few at work and they are great trucks. Imo the less tech the less that can go wrong.
@@alyssia444 Its been a back and forth decision. If the vehicles we have now weren't falling apart I'd definitely throw it at the house. I'm missing out on a lot of bigger side work just because I have to rent a truck to move material. Our newest car is a 2004.
I have a question.. let's say I make 35-40 a year and I have no debt and I want a brand new vehicle civic type r or tundra, and I plan on keeping it for the long haul, would that be a good decision?
The type R will keep a good value just because it’s the first one legally in the U.S
You're much better off buying a 3-5 year old car with low mileage. Let someone else take the initial depreciation.
@@davem4193 I'd buy a used tundra but not a used type R, just based on what I heard/read .
6:00 xD What ive been telling coworkers and friends. They want to see me earn a paychecks worth before they get in.
I'm a little confused, I Google searched and it says that the 401(k) maximum contribution is $19,500 for 2020. Where is Dave getting $6,000 from?
6000 is the maximum IRA contribution if your self employed
A 401k is through your employer, and an individual retirement account. So the IRA is a separate investment vehicle. The max contribution for a Roth or Tradition IRA is $6,000 and the max for the 401k is $19,500.
@@colinzwiebel6770 - So, you can open a separate account and put up to $6,000 in it per year (at least for 2020) on top of the $19,500 for the employer based 401(k) for a total of $25,500? I assume the $19,500 limit includes employer contributions as well?
Khaltazar - there is an income level restriction, if you make more than that amount you can’t participate in a Roth IRA. But if your income qualifies you, you can put in up to $6,000 as of this year. That has nothing to do with your 401k through work. You can contribute the $19,500, which would NOT include any employer matching. Most people should put in as much to get the full employer match (which is free money), then start contributing to Roth to get the tax free growth!
I have tremendous respect for Mr. Ramsey's advice and plans. But this question does point to a gap in his approach. He's so blinded by long-term mutual funds, he ignores individual stock holdings. In this case, my approach for short term savings is to invest in a high-yield dividend stock, with a very reliable (boring) company - like IBM. A $10K investment will yield $1k annually. Much better than any checking or savings account interest. As long as the company is a good/careful/conservative choice - look to earn some income from a dividend, amigo.
He addressed thay issue , he said it's not a lot of money
Dumb question to ask DR. Unless you can pay cash. Best to buy a slightly used car. Millions are turned in from leases every year.
His comments about the Roth IRA are not thorough enough. If you get your children to invest in a Roth IRA when they are young and they are not paying that kind of tax rate they will have quite the investment later in life. The Roth IRA is a tool that can be used in many ways so you got a look at all the angles. Also if you’re making a ton of money later and you pull money out of a traditional IRA could push you into a higher tax bracket. I think it’s a little bit more to it than what he saying
thx dave.. i also like bruce willi. thx from U.S.A.
Thanks for the great content Dave God bless!!!
What did people do before minivans?
Need is a word thrown around very easily.
They drove station wagons. You must be young.
Ever hear of the Station wagon.
horse and buggy bro
@@pjabrony8280 Never heard of them. I am 3 years old. Did you understand my comment?
station wagons with the 3rd row facing the back window
Money market account. Capital one 360 or ally. 1.70 percent
At which baby step should I consider saving for a car? Should I finish all baby steps?
I think it would be cool to see scotty kilmer and dave Ramsey have a podcast together and discuss what the best way is to purchase a car.
Or have scotty and Dave make out with no shirts on!
Save money buy cash
My favorite way to save money is to make more money. Find a side income. Get out there and grind.
A couple of kids don't fit in a sedan?
Why save 30 k for a car dumb . Bro get a old Toyota keep it clean and maintenance your good
But what will the neighbors think? Oh god no not a used mini van it'll cause property values to go down.
Patricia Muszynski right?! Ahah thats why keep those wheels shining
Yea quite dumb if any intentions of building some wealth. Should stick with under 15k
Mark G wow just across the board huh? Very bold, wise statement thank you for your insight into everybody’s situation that you know nothing about
It does not take 5years to save for a vehicle if both your partner an you save well an come up with a great savings budget
No reason to buy it sooner if they don't have the kids at the moment.
I want a new Corvette so bad. $90K...😮😢
Cars will be flying in 5 years! Jetsons son!
Your planning on having more kids and you could barely afford to get a new car?🤦
Amazing content as usual.
Does the Dave Ramsey show come out on xm radio?
Gotta earn enough to live on AND save at the same time. I do not.
IRON-PANDA live on less. Change your lifestyle 🤷🏼♀️
How can I get into contact with Dave Ramesy
Thanks Dave!
In the reality.. You never know. Maths is relative, not constant..
Hey Dave. How would you save if we’re accounting for inflation? I feel like worst case.. saving in a growth account for that long would at least off set the loss of purchasing power in the dollar over that time. Just my thought, I’m no expert! Have a great day everyone
You need to do an update video for 2022 and 2023
How much did his car payment used to be? Say it was $300/month. Put that away and that’s $18,000 in 5 years. Put $2,000 down and boom: there’s your $20K.
Anna Lesher yup! He said they’re gonna save 4000 a year, so that’s close to 300 a month. A little more.
I guess my main issue is why bother talking to Dave about that? Lol. If you have a number goal, save up to that goal. And don’t invest short-term. Just save it up and call it a day.
Anna Lesher 😂
In five years, a used vehicle’s value isn’t going to go up so astronomically that $20,000 won’t get him something reliable and of decent size. A car isn’t a property, so it wouldn’t work the same way lol.
Answers my question.
“Which is a group of nerds” roast them then Dave, I’m crying
Should I invest money I plan to spend?
No!
Whoops cars doubled
Bit harsh on the basement guy
my adhd tries is hard to let me watch this
Dave really hates basements
Next time your broke brother in law has a mathematical discussion ask him what color is your bugatti