I have not purchased a used car in decades. I am fortunate enough to be able to afford a new car, but that didn’t just happen because I have a good paycheck. My wife and I live within our means, we have disposed of as much debt as it is possible to do, and we try to provide for our future.
I get a new car every four years, when I get up to around 100K miles on a vehicle, I sell the car cheap to someone who needs a good vehicle, or give it to people. (Interestingly, the people I ended up giving the car to, in both cases, completely destroyed it through neglect, doing is so quickly it was disconcerting. There is a lesson there...)
Up until the age of 30, I had used cars, and had to get them repaired, worry about them breaking down, etc. When I began to make enough, I took loans and paid them off. As I got older, I paid cash for a new car. I take care of my vehicles. I don’t baby them, but I make sure anything gets fixed, and do my best to keep them clean and intact.
I am fortunate. Many people cannot handle car purchases this way.
But I did live through the Seventies, and anyone who did knows the state of cars on the highways throughout this country was appalling...even new cars rusted to pieces and turned to mechanical junk in alarmingly short time intervals. And I was always working on cars. I grew to detest it, and hated driving unreliable vehicles.
When my livelihood depended on my being able to drive to work, and I had to spend a rainy weekend pulling an engine out of a car mired in the mud underneath a maple tree with a branch to anchor a hoist, it sucked any enjoyment I might have gotten out of doing it with my own hands and getting it done right.
I don’t buy a car as an investment, for the resale value, or anything even approaching that. I buy a car that will be reliable, and allow me to drive in comfort and safety. I am utilitarian about this. I don’t even give a second thought to “resale value”...I think that is a fools errand. For me, it is a tool, if I can enjoy driving it, even better.
I think average people can afford average new cars. But they might not be able to afford a family vacation in the Caribbean, the newest large screen television, the 128 GB iPhone, or the newest computer. And a lot of people want all those things AND a new Lexus. They might be able to do it if they purchased a new low end KIA or something like that with a minimum or no frills.
I set two big goals in life: 1) getting the kids through college and 2) saving enough to retire. We achieved both through careful finance planning, frugality, and a commitment to saving. If you don’t fall prey to keeping up with the Joneses next door, it is doable. For us, buying low mileage CPO used cars has been a key component to our strategy.