Those of you who change cars every 2-3 years, why?

So I like sports cars. Started with a regular sedan, then upgraded to a WRX, then upgraded to a Supra. Next is likely a Porsche.

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durbomat@reddit

What do you mean with finance it using your own bank account? Buy it outright and save the payments you would have had for the next down payment? Otherwise I don’t understand how 0% interest is possible.

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WirelessTrees@reddit

If you finance with a bank, they basically give the total to the dealership, and you slowly pay back the money they paid to the dealer.

If you finance with yourself, you buy the car outright, and the car is completely in your name and you have no payments. Awesome right? But you just lost a ton of money, and need a way to get that money back right?

So you work and pay yourself back the money as if you were financing the car. Normally people pay $400 a month for their car, but you can just deposit $400 into a savings account and that money will build up.

Then 4 years passes. Someone who financed the car has the car in their name, but no money saved up. Someone who bought it outright and paid themselves back has the car in their name, plus the money they've been paying themselves. This allows you to now trade in and use this money to buy an even nicer car.

pardon my french but what in the actual fuck lmao

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mathostx@reddit

So Im guessing you dont agree? lmao

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starmiemd@reddit

Sure no bank or dealer payments but every year you use the car dollars fly out the window... oil changes, repairs, tires, insurance, registration..

But that happens regardless of if you pay cash, finance, or lease.

the 30% devaluation once it leaves the lot isnt yours. The dealer eats that.

starmiemd@reddit

That doesn't make any sense. It's the same thing, except when you finance you pay slightly more because of interest.

Someone who financed the car has the car in their name, but no money saved up. Someone who bought it outright and paid themselves back has the car in their name, plus the money they've been paying themselves.

At some point, it’s cheaper to rent or test drive every fun car once or twice from dealers or rental companies than to swap out new ones every few years.

If you’re that fickle about the car you drive, you’re literally ok with throwing money away to satisfy your need for change.

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Crownlol@reddit

Yes, I am comfortable spending money from my job, that I do so that I can have money, on things that I enjoy and derive pleasure from.

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Kenitzka@reddit

Folks would be shocked at how much money they’re literally pissing away doing this. But hey, you make it, you can spend it.

Just a little shocked at how some are so flippant about it, when you could be putting that money towards an asset that has positive growth, or towards retirement.

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Crownlol@reddit

Well, see, I dont have to. I'm already at the annual max 401k and IRA contributions for 2023. I own a beautiful home and a rental property. I invest into a taxable brokerage too.

I could also have gotten killed on my commute home today, and all that would be wasted.

I'm always baffled at how people feel entitled to give strangers unsolicited financial advice on the internet, without any knowledge of their situation. But do go on, tell me what else I should be doing with my money.

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You’re absolutely right. Some people love cars more efficiently.

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the_lamou@reddit

If you're worried about loving something "efficiently," that's not love. I don't know what it is, but it's definitely not normal love.

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Kenitzka@reddit

Nah, it’s just how you can love more of them.

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Pretty sure you’re the exception rather than the rule. And I’d be shocked if you’re leasing.

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the_lamou@reddit

I actually leased my last two nice cars: the F-Type and my CLS. I'm not leasing at the moment, because I've pared my garage to a winter beater (currently all-season beater) and project car, but I might lease my next nice car depending on what the rates are like. The thing about leasing is that if you like the car, you can always just buy it out and it'll cost you about the same as straight up buying it from the beginning.

And sure, maybe I'm the exception, but also not that rare an exception. And would be less rarer if people thought more about income than expenses.

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Honestly the fact that you’re not frugal enough to just live out of your 1992 Buick LeSabre, and eat nothing but cheerios and ketchup packets just astounds me! What a crisis! Someone call this man a doctor!

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PickleEffective8109@reddit

If you like cars so much, just live in one! Much cheaper in the long run. I don’t understand why people buy houses, like ??? What are you doing do you want to be POOR??

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ducktor0@reddit

Just a little shocked at how some are so flippant about it, when you could be putting that money towards an asset that has positive growth, or towards retirement.

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daversa@reddit

Alright.

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boomdart@reddit

You say that assuming other people would rather spend their money on something else, but that's what people want.

Everyone buys their car knowing what depreciation is. Why is it important to you that no one buys a new car? Why do you want to save them money? Also, when someone wants and can afford product A and you offer used product Z, and money isn't the issue, why would you go for used product Z?

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Financial_Ice15@reddit

the only point of money isnt to save up for retirement 20 years in the future, its also used to enjoy life. no point in saving all ur money, living poorly in ur youth just to enjoy ur retirement.

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RuSS458@reddit

Tbf there’s also plenty of people who buy a somewhat classic outright, keep it for a couple/few years, do their own maintenance then sell it for similar or more than what they bought it for with some added miles due to its appreciation curve then buy something else and the cycle continues.

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the_lamou@reddit

For a lot of people, money isn't the primary constraint on their hobbies. Especially relatively modest sums like you'd be paying to lease/carhop non-supercar vehicles.

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GMCBuickCadillacMan@reddit

Lower payment typically than if you were to finance the full amount instead.

Always have a warranty on the car and not have to worry about replacing tires, brakes, or fluid flushes.

Always have the newest car with features and quality higher than “deserved”.

At the end of the term 2,3,4 years you have no obligation to the car and can turn it in if it is not worth much or trade it with potential equity.

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pharmphresh@reddit

but you've pissed away $15k and still don't have a fucking car at the end of it. If you'd financed the purchase of a more reasonable car you'd still have something to drive and soon no more car payment at all while still retaining some value in trade equity

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dontbeslo@reddit

Why would I want a car? It depreciates! Let’s assume the car was $40k or whatever, I lease it for $15k/3 years. 0 down. Invest my $40k. My lease ends up being like $400ish/mo, $5k per year. If I’m earning 5% on my $40k it’s worth 42k after the first year, 44k after the 2nd year, and 46k after the third.

I’ve made $15k in payments, and still have $31k left from my original $40k. That same car might be worth $35k or $25k after 3 years. If I bought, my money is all tied up in a car that’s worth less and less each day. On the lease, I just have to come up with $400/mo while leaving my investment alone as it grows.

Let’s assume the lease residual is $30k, If the car is worth $35k I buy out the lease and immediately flip the car. If the car is worth $25k I just give it back.

The example above is simplistic and for the average person leasing doesn’t make sense. If you’re flexible on what you drive, you can hunt for vehicles with high lease residuals as well as incentives and drive something for pretty cheap.

I’ve leased cars for as low as $150/mo, and I’ve leased $60k cars for well under $400/mo. 0 down. No way would I want to take that $60k and put it into a depreciating asset

Leasing is harder now with the crummy rates, but we’re seeing deals pop up again.

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deleted_by_reddit@reddit

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GMCBuickCadillacMan@reddit

Yes your logic is clear. If you are the type of person to trade every 3 years anyway however you will lose more money in negative equity over time.

Lots of people finance and trade before they pay it off anyway and most loans are 72 months now.

Depends on the situation.

If you have expendable income it’s a convenient option. If you are focused on building wealth then buy a 10 year old Toyota.

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amontpetit@reddit

It’s the sweet spot for the dealer to be able to sell the vehicle once it’s returned at the end of its lease

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Kenitzka@reddit

Right, sweet spot for dealer. But what about the consumer? What is the benefit to them?

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redoctoberz@reddit

What is the benefit to them?

The last time I did a lease the car ended up being worth thousands more than the buyout at the end of the term. Makes it an easy flip situation.

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mack-t@reddit

Same here. I got an $8000 credit for turning my lease in 4 months early. They took it as the downpayment for my new truck. Benefit for me is that I own a business and write off the lease to my business.

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deleted_by_reddit@reddit

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amontpetit@reddit

In many cases it’s the only lease term on offer so it’s not like they have much of a choice. I suppose it’s probably at around that point that the car starts to show a bit of wear and tear and require some larger maintenance items, which is why some people might want to swap out.

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lmp9002002@reddit

The choice is whether or not to lease at that point. You always have a choice.

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deleted_by_reddit@reddit

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I don't see the difference in a lease or loan, both tie you to a fixed cost for a predetermined time. With the only difference being whether or not the vehicle is yours at the end.

Personally I've only bought cars from my own money, as I don't want to be stuck to paying something for years to come. As you never know how your financial situation is in a few years. And I also don't like to pay for something I eventually have to give back.

Meanwhile I own 7 cars, and altogether (even with thousands of euros on extensive repairs on some of them) the total costs for those are less than that one brand new mediocre Renault crossover costs my neighbour or what a friend pays over the same timespan for his Chinese lease car.

Again: there is no way you pay less on leasing or buying new than just buying an older car.

Yeah but it’s a percentage of income thing.

If you make 30k a year car jumping can ruin your life. If you make 3 million a year it’s whatever.

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DoctorsAdvocate@reddit

If you make 30k a year you go all in on the first year on a 14k car. After that, every year you can rotate cars within the sub 14k range. Some cars hold value great so trying them out for a year doesn’t cost too much. A few will even appreciate if you’re lucky.

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Morighant@reddit

Was thinking about this. Bought a car for thirty in 2022, want a Tesla in next few years. Trade in car for 15-20k, put 10k down on a Tesla, and I'll probably owe less than 15k on a used Tesla and my payments will be decently low.

I'm coping so hard but Jesus fuck I want one so bad. Trying to kick the thought out of my damn head, saving up for a house and I shouldn't be having these thoughts

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DoctorsAdvocate@reddit

Yea just save for the house man. I made this comment when I had more cash, now I’m focused on saving cash and avoiding payments. Just wanna afford property before i’m 35/40 or something

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Morighant@reddit

Yeah I'm 28 with about 20,000 saved up and I've been a fuckin cashier most my life. I feel extremely rich for someone in my work demographic, but poor on the "Wow houses cost 300k" scale. I dropped 16 k in last two years on health related issues and I'm finally saving and I've never had this much before, I think that's why I'm tempted by a fancy car, not my Box. But it's a 2023 box, and it's my box, and I love my box.

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DoctorsAdvocate@reddit

Bro I’m 28 too, I have 3 cars and in thousands of debt. It’s embarrassing people think I have cash because I have cars but in reality i’m broke as fuck now.

I would much rather put that money into a brand new vehicle.

You asked for the logic or thought process so here is mine.

You always have a brand new, latest technology, reliable and safe vehicle. Your car will always be new.
You ALWAYS are protected with a warranty if you don’t void it. Most warranties start dropping what they cover at 3 years. Why would I keep a vehicle, dumping money on maintenance/tires etc just so it can reach that $100k threshold where things begin to break and repairs are needed? On a vehicle that is no longer new…
You’re not stuck with a commitment to your car and can try something new the next time around.

Now I know people are gonna say “why don’t you just lease?”

The answer is because I drive way too much and my monthly payment would be outrageous…which leads to my next point.

The only numbers that matter are the monthly payment. It doesn’t matter how the dealer does their voodoo financing magic to get you approved… as long as you can afford the payment.

So I always focus on getting the absolute lowest monthly payment I can…because in 1.5-2 years I’m just gonna trade the car in and get another loan. Why refinance a used car when you can get a brand new one?

I will note that this works best with cars that hold their value better. I spend a lot of time in my car so I get them fully loaded. Trying to cheap out on a car because it’s “sensible” to have a cheaper car with a lower monthly payment doesn’t make sense to me. If you’re gonna pay every month for a car, it should be everything you want and more. You don’t have to drop $60-$100k…there are affordable options that you can get premium trims on.

Honestly, it’s not a whole lot more a month to upgrade to a fully loaded trim if the car you’re looking at. To give you some perspective my 2023 car was like $26k brand new fully loaded. The car I just bought is $34k and is also fully loaded. That’s $8000 more car and my payment went up $160.

That was a personal choice, I didn’t have to get what I got…but to me it was well worth the extra $160 a month to have a 2025 (it’s may of 2024 as I write this) fully loaded beauty of a car. That’s just to put things into perspective. I make significantly more now than I did when I bought my 2023 car so I treated myself to an upgrade.

In another 1.5-2 years I’ll put out a few thousand dollars as a “down payment” to offset the negative equity and do it all over again.

You might pay $30k total with interest or whatever for your car over 5 years…but you still just have a 5 year old car that you’ve had to maintain the whole time….and I’ll have a brand new car that’s always covered by a fresh warranty and yearly subscriptions to satellite radio or apps with special features.

By the way, my car payment was due soon for the car I traded in…but now I don’t have a payment until July. 9th (it’s May 27 today). That there just saved me $500.

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shmarcussss@reddit

I lease for 36 month terms.

I like the idea of always having a warranty so I never have to pay for anything if something breaks.

The maintenance is covered by the manufacturer so I haven’t paid for anything besides gas and insurance in almost a decade (besides my car payment that’s under $300).

I can sell the car at the end and keep the equity if there is any, if it’s upside down for whatever reason I can just hand it back or if I love it I can buy it. Downside to buying at the end is you’ll pay even more interest if you finance.

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Shockedge@reddit

Usually cause I crash it

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_WhoElse@reddit

Think about it. Most people spend 99% of their time in one of two places. Your house or your car. It’s easy to get bored or just really drawn to cool looking sheet metal. That’s my issue. I see a car I like the design of and I obsess over it until I buy it or trade for it. Get bored with it and do the same thing again in 6 months- a year

I live cars so tend to change mine every 18 months to 2 years, like Pokémon I’ve gotta collect them all 🤪

15 cars in 22 years so far

I will add I don’t buy new cars, someone else can pay off the crazy depreciation before I buy it

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Own_Investigator5970@reddit

My guess is warranties and being materialistic. Some people they only believe in warranties than reliability, because some cars start to break down after warranties expire. Some people are being materialistic and trapped in this 'consumerism' society. They always want the latest technology to impress others and because everyone is doing it and they feel the need to fit in like changing new iphones every 2 years. But then, some people, they want to experience different cars.

Interior is fantastic. The motor and trans seem way nicer than my 5.3l gm. My sierra had some pretty hard shifts and apparently that’s just a known issue that won’t be fixed. I have the hemi with the e-torque (I can joke and say it’s sorta a hybrid). I only have like 12k on it but it’s pretty nice. The truck looks good in my opinion but the big thing was is they were doing like $6500 under msrp when every other truck I looked at was at least 7k over sticker.

-> Used Hyundai Elantra first car out of college. Kept 2 years, terrible in the snow to the point it was dangerous (awful!) so traded it in for AWD car.

-> Used manual BMW 328i for 6 years. Wife doesn’t like driving stick. Wanted an automatic and it had 135k miles so time to move on. Loved this car but traded it in.

-> Leased a Mercedes E-Class for 3 years. It was new body style so reliability was unknown and leasing was cheaper. At end of lease, the buyout price was $42k and fair market was $28k. I let the dealer take it back. I could have then turned around and bought it from them for $28k and would’ve saved roughly $10k compared to buying it in the beginning instead of leasing. Decided to move on.

-> Used Lexus ES 350. Bought with intention of keeping for 10 years. Covid happened and used car values skyrocketed. Had the car for 2 years, traded it in for $8k more than I bought it for, so basically drove it for free for 2 years and walked away with a profit.

-> New Audi E-Tron SUV. I wanted electric vehicle because I live in a city and wife has a gas SUV for road trips. This qualified for the $7500 tax credit at the time. Interest rate on the loan is 3.5% so beating inflation rate means effectively paying less than if had purchased in cash. The value drop on this vehicle sucks, but the tax credit and my ability to write off the value with my business recouped all the lost depreciation. Plus I had to trade the Lexus to capture the inflated value/profit and rolled it into this. This was a unique situation that worked for me and was all about timing the used car market and only paying sticker on a new car with no markup while getting the tax credit, tax write-off and cheap loan. Still own it 1+ years later.

-> In process of selling wife’s midsize Jeep GC to next door neighbor who’s buying it for daughters first car. Has 117k miles. We bought it new and owned for 9 years.

Some guys have one car but get lots of girls.

My wife lets me have lots of cars but only one girl...

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CarbineGuy@reddit

I get bored.

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Wiseguy_7@reddit

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Jdtdtauto@reddit

I’ve had prolly a dozen cars in my adult life (only one at a time). I like cars, they’re toys to me. But I’ve only ever bought one NEW car (and kept that 5years). Otherwise, I buy a 2-3yr old car.

I like having a new-to-me toy. I enjoy driving, it’s a hobby. For me a car is not just a utility tool.

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michaelshreds@reddit

I like to trade my old problems for new problems.

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mdboulger@reddit

As a guy who likes having newer features and low maintenance while being able to switch up the dynamic, if every 3 years is in the budget, I’d like that.

If you ask my wife: as many people have said here, a car is just a tool. She leases to have low payments and no maintenance. So, when the lease is up, it’s onto whatever next best thing that will give her the best rate, lowest maintenance cost, while maintaining some creature comforts.

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SSVR@reddit

I just want to drive and experience as many things as I can. That’s all really. Cars are fun, don’t wanna miss out!

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Lazy-Explanation7165@reddit

Safety is a huge reason for me and my two small kids. And I like new cars

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enosprologue@reddit

There’s a big drop off in resale price once you start hitting a certain mileage, the brand comes out with a newer model, or the warranty runs out. It’s a motivator to resell quicker after buying a new car. It may not necessarily work out cheaper in the long run, but for it to work out cheaper may mean you have to keep the car for 10+ years, which increases the chances of having issues and, if you drive a lot, may accumulate a lot more mileage than anyone is willing to pay for. Plus you get to always drive a new-ish car.

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baconandbobabegger@reddit

People value cars differently, some see it as a tool, others as a hobby. The desire to change/move up in a hobby is common. I see it with espresso machines, 3D printers, etc.

People also require different vehicles for different periods of their life. Whether its a move, pet, kids, divorce, the type of vehicle they may want could change.

When I could only afford a single vehicle, I changed every 2 to 3 years but now that I am able to afford multiple, I keep them longer since they are more purposeful.

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POSVETT@reddit

I could write a small book about what I did several years ago when I changed pickup trucks (GM full size) annually. I also leased a Tacoma for 24 months and made a little money at the end. The abnormal market post pandemic also gave me multiple opportunities to drive new cars then sold them for profit or for small cost to drive them while I keep my Corvettes out of the salty winters. It also helped that I work for a car dealership. The shortest stint was 3 months and 3k miles on a brand spanking new '22 Toyota 4Runner TRD Off Road that I sold for $3.5k more than the purchase price.

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mortimerza@reddit

Like new things

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kenny_McCormick-@reddit

Maybe just reliability issues or change of taste . I plan on driving my volvo into the ground because the resale values pretty low lol. And i love it.

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el_d3sconocido@reddit

I had a new kid every two years:

Kid 1 - Jeep Wrangler Sahara Kid 2 - Outback 3.6R Kid 3 - Jeep SRT Kid 4 (dog) - Ford Raptor

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Da_Natural20@reddit

The ashtray was full

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Unhappy-Manner3854@reddit

I started of driving with a 17 plate corsa 1.4 - was severely slow and barely got up Hills without sounding like it was about to explode.

A year later i then swapped this for a vauxhall astra 2l 18 plate. Had 200 bhp and all the modcons so was cool, fast and fun. However it just didn't look or feel special, it was just an astra basically.

I then upgraded 8 months later to what i have now, a kia stinger. Looks good, fast and gets lots of attention (which turns out to be more annoying and worrying than good) but every time i get in and out i just admire its looks.

So by my ratio i should have a new car in the next couple months.