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Average American loves new cars, hates common sense

December 28th, 2011 1 comment

Americans love their cars. Buying a new car is an exiting event for most of us, and is often accompanied by copious amounts of internet research, multiple visits to dealer showrooms, and careful budget considerations to determine what we can comfortably afford. Oh wait — scratch that last one.

It turns out that most Americans are actually completely incapable of making sane decisions when it comes to money. The car-buying mentality in America appears to be a two-step process when it comes to finances: first, figure out the absolute maximum that you can afford to spend every month on a car payment. Then, find the best car that you can possibly buy, using that entire monthly budget. This is why car salespeople can commonly get away with simplifying a new car transaction down into the all-mighty monthly payment figure, glossing over minor details such as purchase price, fees, and loan terms. After all, those figures aren’t important if you can swing the monthly payment, right?

But what if new vehicle discussions didn’t revolve around whether or not your monthly budget could accommodate a $289 car payment? What if car salespeople put purchase prices into real-world terms that even the most math-challenged person could understand? What if a car salesperson asked you if you would be willing to hand over every single penny you earned for the next 14 months, in exchange for that car you’re eyeing? Because that is exactly what the typical American is doing.

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Categories: Financial Idiocy Tags: ,