Your Car and Your Financial Freedom

Your Financial Freedom is determined by very simple concepts. This site sorts out your abundance of wealth, success, and how to attract wealth.

Is Your Car an Asset or a Liability?

Do you love your car?

We all do, of course.  Cars have become symbols of our abundance of success.

But did you know that your car is a ‘money pit’?  Let me explain.

Let’s set aside the fact that you love your car (as I do) and let’s look over it’s true costs as a transportation vehicle.  Aside from the entertainment value that cars add to our lives, we want our cars to safely take us from ‘point A’ to ‘point B’.  That’s the functional purpose of automobiles.

Now let's relate this to financial freedom and how to attract wealth.  New cars lose their value FAST.  Very fast.  It’s estimated that a new auto will lose 20% of it’s value as soon as we drive it off the lot.  And after the first year of ownership, the value continues to decline 7% to 12%.  When you put these depreciations together, a new car loses 25% to 35% of its value in its first year!

Therefore, if you buy a new car for $25,000 it will be worth only about $17,000 by the end of your first year of ownership.  That’s an $8,000 loss – ouch!  By the end of your second year of ownership, the value will drop to around $15,000 – which is a $10,000 loss in only two years.  This obviously interferes with our abundance of wealth.

Can you see how this gets in the way of our financial freedom?

Plus, insurance rates are higher for new vehicles.  And in some states, vehicle registration costs are considerably higher for a new car – sometimes hundreds of dollars more than a used vehicle.  And of course, we’re losing money on the interest we’re paying for the car loan.  The bigger the loan, the more interest we pay. 

But let’s say that instead of buying a new car, you purchase a 2 year old vehicle of the same model (with reasonable mileage).  You won’t have any trouble finding one that looks and drives pretty much like new.  Other than not having the ‘new car smell’, it’s almost the same thing.

Men of Affluence and Women of Wealth

But the biggest difference is that by buying a 2 year old model, you’ll be $10,000 richer.  Your abundance of wealth is determined by simple choices like this.

But what if you invest that $10,000 used car savings and put it in a Mutual Fund for 30 years?  At a conservative 10% annual return, your $10,000 will grow to over $174,000 thanks to the magic of compound interest.  And this is just one example of how to acheive your financial freedom through success strategies.

If someone offered to pay you $174,000 to drive a nice used car instead of a new car, would you do it?  When we learn new financial strategies, we attract wealth.  When you receive a new job promotion and enjoy career advancement, don't "reward yourself" with a new car.  Instead, pocket an easy $174,000.

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