Recruiting Football Talk VIII

[therickbol]

Stats show that people in this economy are generally living on credit to keep a relatively similar standard of living to what they had pre-covid/inflation. Auto loan defaults are skyrocketing. Auto repossessions are skyrocketing. Even dealer-repossessions (where auto makers are taking stock back from dealers b/c dealers can't afford to pay for the cars on their lots that are remaining unsold).

The fact of the matter is that the auto industry is a bubble that's bursting, and very few people can afford a new vehicle, whether they realize it or not. (Face it, the average American is HORRIBLE with their finances and won't admit to themselves that they can't afford their lifestyle.) The wife and I drive used cars even though we could buy ourselves new ones in cash right now if we wanted to. But we'd rather have the savings for early retirement. The fact of the matter is that a new car purchase is a horrible investment, even for those that can afford it. It's absolutely asinine for young or less fortunate folks who will struggle to do it.

Exactly. The best market for Americans would include much, much fewer new cars rolling off production lines. Much fewer new car lots. The marketing teams at automobile manufacturers have done a phenomenal job of manipulating customer psyche. Of course, honestly it is not difficult to manipulate it when it comes to new and improved technologies and features on something as 'fun' as automobiles. So I guess we shouldn't give them too much credit. The market is jacked up. But demand is demand, even if it is destructive demand. And so the automobile market has succeeded but at the expense of the typical upward movement financially of the middle-class American. I am a public school teacher and we are not in the highest income bracket. But we are in a good place in terms of our net worth. And one of the biggest reasons is that we have not had a car payment in the last 16 years. We drive dependable used cars and save up to buy the next one. And it ain't like we are driving clunkers around.

 

[therickbol]

My Dad does the opposite and only buys new cars. He pays cash and drives them for three years and trades them in for a new car…. He never has to pay for maintainence, oil changes, tires, etc.

He "paid" for all of that financially by the upcost of the new car. Now, in terms of not paying for those things in terms of saving the time and inconvenience that would certainly be true.

 

[southpaw75]

I can't believe we are opening the season in the smokey greys. The vols should wear nothing but orange and white. I hate what NIL has done to this game

If you’re a Vol, you should love what NIL has done for the game.

 

[mrMet]

If you’re a Vol, you should love what NIL has done for the game.

I found a newbie!!

 

[Orange_Crush]

If you’re a Vol, you should love what NIL has done for the game.

Closet DAWG fan IYAM.

 

[jave36]

Yah, we have a pretty big chunk in standard savings that I need to move into high yield. I'm seeing some CDs at 4-6%...?

Tbills are better than CDs, at least around here. 5% on 3 month tbills or 5% on a 13 month CD? No brainer.

 

[Orange_Crush]

Tbills are better than CDs, at least around here. 5% on 3 month tbills or 5% on a 13 month CD? No brainer.

With inflation the way it has been, I'm almost tempted to take a chunk and buy physical gold. Thoughts?

 

[Aesius]

Tbills are better than CDs, at least around here. 5% on 3 month tbills or 5% on a 13 month CD? No brainer.

There's a bank near my house with a scrolling marquee advertising 3% 18-month CDs. Mind-boggling to think that anyone would sign up for that. I get nearly 5% in my savings account and can move my money around freely whenever I want.

 

[gordonr24]

Love this

 

[bigorange]

 

[Jack Burton]

With inflation the way it has been, I'm almost tempted to take a chunk and buy physical gold. Thoughts?

I think the worst is over for inflation. People expect the fed to start cutting rates soon.

Traditionally small cap companies benefit from rate cuts. So do tech companies. Load up on nvidia stock!

 

[COOKEVOL]

It's pretty well known that most pirates can't spell. I'm fact, most of them can't even recite the alphabet. Almost all of them get lost at C.

 

[COOKEVOL]

You talking about like a whole new model (like a maverick) or a new generation of a car, like the toyota tacoma’s just came out with the Gen 4 style

Whole new model.

 

[Jackcrevol]

Whole new model.

twss

 

[volinexile17]

It is definitely accurate. Automobile payments+interest are one of the primary restraints that holds back wealth acquisition. There are also expensive habits that can certainly contribute. As always, there are exceptions to every situation. But the American culture towards automobiles is certainly destructive to wealth building. Massive depreciation on an asset that is consuming significant percentage of your income is a bad formula.

Again, not saying I disagree, as my wife and and I both drive our vehicles as long as possible and don’t purchase expensive cars.

However, there are way bigger impediments to wealth acquisition in my observation and which are more likely to lead to bankruptcy - albatross mortgages, crushing medical debt, caring for elderly loved ones, multiple kids in private school, etc. All things that are way more expensive than a car.

 

[Weezer]

I've started skipping pages. It's kind of nice avoiding the bad jokes. Maybe it was @drvenner 's bad humor making me feel unwell?

 

[MuletownVawl]

Wow! How are they gonna deal with the heat from those dark jerseys?

They will all be on the field about 3 series before exiting the game to be by the mist fans to relax enjoy the remainder of the show

 

[Orange_Crush]

I've started skipping pages. It's kind of nice avoiding the bad jokes. Maybe it was @drvenner 's bad humor making me feel unwell?

Hope you're feeling better?

 

[tnhunter 10]

Guess we will see if he's correct.

 

[WesTnVol]

Proverbs says that "The debtor is a slave to the lender."

I used to think that was colorful language to make a point, but as I've looked back on my life and reevaluated the system we live in, I actually read that quite literally. Debt causes us to spend a lot more time doing things when we'd much rather be doing something else. Interest is money thrown away for most of us. We'll never get it back. That money is invented. "Printed" out of nothing. We spend our lives trading hours of life that we'll never get back, just for a piece of paper or a direct deposit of that thing that they printed out of nothing. We go into debt and add interest payments so that we can have things now that we can't afford yet.

We chase more things we can't afford because there is an entire marketing industry that is actually psychological warfare against us. The sellers know they are selling us things we don't need. So, they hire people who are studied in the psychology of fear and our own feelings of inadequacy. If you don't look, smell, dress, or drive <these things>, then you won't measure up. Cover your inadequacies by buying this <thing> that you either don't need, or is more than you need.

How much better will most of us be if we slow down, figure out at any given time what's (A) an actual need that (B) I need NOW. Stop going into debt for things. Wait as often as possible until you've saved and can pay cash.

And to the younger folks. The quicker you wake up to this, the better off you'll be.

Go sit and talk to the 70 year old greeter ay WalMart, who can't afford to retire and can't afford to live on their social security. There's a good chance they didn't wake up until too late. Ask them how much money they think they spent in interest over their lifetime, and whether that amount would help them retire today. (Note, this is in no way meant as an insult to the poor. There are indeed poor people who have always been poor, never took out a loan, and are still poor. But in America, there are FAR more people who waste a lot of damn money on debt that they never really needed to have. And they will never get the time back because they're basically working their entire life for the bank, their masters.)

I’m 66 years old and I’m sure there are many on here who have the same/similar story.
My parents never owned a credit card and never had a car payment. We were not rich by any means but dad drove and repaired the car (singular) we had until he could afford another used car, never a new one.
He did take out a home loan but he did that through the VA. $37/month
Funny story about 5 years before the house note would be paid off they offered dad a deal pay XXX and they would close the contract. Seems it was costing them more money to process dads paperwork each month than the $37 he was paying.

 

[mr.checkerboards]

I can't believe we are opening the season in the smokey greys. The vols should wear nothing but orange and white. I hate what NIL has done to this game

The Grey's are mid, but the black is the best jersey we have.

 

[therickbol]

Tbills are better than CDs, at least around here. 5% on 3 month tbills or 5% on a 13 month CD? No brainer.

I have been doing a T-bill ladder for the last year and it has been really good.

 

[therickbol]

Again, not saying I disagree, as my wife and and I both drive our vehicles as long as possible and don’t purchase expensive cars.

However, there are way bigger impediments to wealth acquisition in my observation and which are more likely to lead to bankruptcy - albatross mortgages, crushing medical debt, caring for elderly loved ones, multiple kids in private school, etc. All things that are way more expensive than a car.

You are correct. I said there are always other factors involved. And you brought up bankruptcy. Large unexpected crushing expenses like medical or assisted living for elderly can definitely lead to bankruptcy. Those are not consistent month after month year after year decisions that restrict a person's ability to acquire wealth. Which was the circumstance I was talking about. And having emergency savings and great insurance are things people would be better equipped for if they had not spent 10 years draining wealth with extensive car payments.

 

[VolGee4]

It is definitely accurate. Automobile payments+interest are one of the primary restraints that holds back wealth acquisition. There are also expensive habits that can certainly contribute. As always, there are exceptions to every situation. But the American culture towards automobiles is certainly destructive to wealth building. Massive depreciation on an asset that is consuming significant percentage of your income is a bad formula.

That wasn't the discussion though. I agree that a high car payment can hold people back from saving money.

The original statement was that the "average person is less likely to achieve $1 million net worth because they drive expensive vehicles." First, there are many, many reasons why people won't achieve $1 million net worth, and it usually has to do with income. Second, there are very comfortable people who may not have $1 million in net worth right now who can afford expensive vehicles. Paying for that car is not going to stop them from accruing more wealth.

Overall, the general thought is fine. I have purchased 4 new vehicles in 16 years of marriage, but there are variables in play. I am pretty sure one had equity when we drove off the lot in 2008 when the economy was awful. We had it for 15 years. Paying cash also saves you a bunch of money. Loans on used cars can also carry higher rates. As I have stated previously, I am not into absolute statements.

 

[Govolsman98]

Just as I wished it to be!