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Old 04-18-2014, 01:20 PM   #9 (permalink)
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Acura TSX - '06 Acura TSX
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Originally Posted by Fat Charlie View Post
If you don't have much money to spend but want a car, new might make sense...

It's not that the poor are making worse purchasing choices, it's that they have worse purchasing options to choose from.

Someone at the Fit forum I go to just reported paying 13,250 for a 2012 with 58k.
I paid 14,998 for one with 11 miles on it (and two of them were my test drive).
You bring up good points, but I still disagree with your assessment that there are not good purchasing options for those with little money.

The guy that bought the used Fit for nearly what you paid new, probably did so at a stealership and didn't negotiate the price. He likely allowed the Con Artist to pull out a sheet of paper and draw the absurdly stupid 4-square and then convince him that the monthly payment amount is the only thing that matters.

Hypocritically, I did purchase my TSX from a sealership because the exact car I was looking for was very difficult to find on the private market. The slimy salesman drew the 4-square and started asking me questions. His initial offer for the 4 year old, 36,000 mile car was $24k. I laughed incredulously. The new MSRP was $30k.

I told him the only thing that matters is the sale price, and he can put the 4-square away. I operate on a 1-square. When asked what I thought was a fair price, I responded, "17."

He countered a few times, going lower and lower, and I maintained my $17k price. I had no intention of buying the car when I went to look at it anyhow, and hadn't even done much research concerning the price. At the end of the negotiation, the stealership had come down to $17,500 but was unwilling to go down to $17k. I walked out.

Several phone calls by the stealership, and 2 weeks later, they accepted my $17k price and I drove the car home.

If I had taken the initial offer on the car, I would have lost $7,000.

I once also had a girlfriend that had bought a new Chevy Aveo. I believe it was the cheapest car sold in the U.S. at the time. 2 years later, she traded her Aveo in for... a new Aveo because she wanted AC and liked the color of the new car better.

Both cars were easily the crappiest cars I've ever been in. She could have saved money and driven a much better car, but she allowed someone else do the thinking for her. Needless to say, she is an ex-girlfriend.

My point is that anecdotes are not worth much. My experience is easily countered by the story of your experience, but the fact is that there are plenty of good and affordable used cars to choose from in most markets.

Originally Posted by jamesqf View Post
Seems as though our reference points for 'poor' are quite a ways apart. To me, being able/willing to spend that much on a car means you're not poor - or at least you weren't until you went and spent all your money on a car :-)
My definition of poor is being up to your eyeballs in debt, but not owning any appreciating assets. Buying a new car is among the poor investment decisions.

I know plenty of people that make much more money than I do, and they are poor. They are the people that come to me for a (free) loan so they can make their rent.
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