Is that true? That is what I think I heard Dave Ramsey say on his show today. Three hundred and eighty-four dollars! Wow. I know some of you are not average, maybe you are even ABOVE average. (EDIT. March 10, 2008, I heard from a reliable source that the average car payments was up to $484.00. I would think that is closer to the truth, it depends on where one is getting the data)
By the way, you may want to look at these Car Buying Guides before you buy a car.
How much would that money be worth if you had a paid for car?
The mind set of borrowing money, and especially borrowing money to pay for things that decrease in value, like cars, is the mind-set that keeps so many people living from paycheck to paycheck and broke all their lives.
Proverbs 22:7 New International Version (NIV)
The rich rule over the poor, and the borrower is servant to the lender.
You may not ‘feel’ like a slave to your lender, but try not paying on time a few months and see how you feel.
If these average people drove a “paid for” car, and invested the $384.00 a month in a good growth stock mutual fund ( which should make about 12% over the long term). What would the result be?
Let’s say this person is 25 years old. At age 65, this person would have about $4,517,672.64 to be exact.
Sure, the time value of money and inflation and such would make this money worth somewhat less in today’s dollars, so let’s just say it’s only worth half. 2.2 million dollars looks good to me! See my post on how to make a million dollars for more about compounding interest.
Check out used cars on Ebay! Maybe you can sell your car and buy one that is less expensive?
My thoughts about the average car monthly payment that many people are paying. What do you think? Do you listen to Dave Ramsey on the radio? I think he has some good advice for us all, especially me. Let me know what you think!