this post was submitted on 06 Oct 2023
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More Than 80 Percent Of Americans Can’t Afford New Cars (jalopnik.com)
submitted 2 years ago by boem@lemmy.world to c/technology@lemmy.world
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[–] Kazumara@feddit.de 9 points 2 years ago (4 children)

The example the article gives is pretty extreme to me:

[Greg] McBride, the Bankrate analyst, walked MarketWatch through a hypothetical car-buying scenario for an average-priced new car that cost $48,000. Taking into account the trade-in value of your existing vehicle, let’s say you knock some money off the sticker price and finance a $40,000 purchase price at 7.5% for five years. That’s an $801 monthly payment — which means you would need to make $96,100 a year if you wanted that payment to be 10% of your income.

I don't think I'd ever want to spend half a yearly income on any single purchase. An investment in a house being the only exception.

[–] tony@lemmy.hoyle.me.uk -1 points 2 years ago

Those are extreme cases.. they're buying a 48k car (that seems on the high side) but trading in an 8k car (so old/cheap or both).. of course the loan is going to be large.

Normally you'd time the trade.. my current car was an upgrade on my last but the monthly payments reduced because I timed it so the value of my existing car was reasonably high.

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