Sleek, sexy, stylish, luxury. These are the words associated with vehicles today. When you hear the words ‘retirement income’ I bet you think old, security, lame and boring. Would you rather have an Escalade or Early Retirement?
It is no wonder that when you think of the two side by side most often people would rather have the luxury car first rather than the retirement income. Vehicles have been a reflection of status for years. He who has the biggest, shiniest, fanciest vehicle wins. But do they really?
What if I told you that you can lose over $10,000 a year by doing one thing. Would you want to do it? Probably not. But the majority of people will still do it! Why? They want to look rich, they want to feel rich and have the status. But lets look at the numbers for a minute.
If you purchased a top of the line Cadillac Escalade (AWD 4DR Premium) in 2010 you would have paid $79,575 (not including tax). Let’s assume you financed it so over 6 years you would have ended up paying $87,050 total (I’m still being nice and not including tax!)
2010 Price $87,050
2017 Price $38,000
That is a cost of $10,175 a year! That doesn’t include maintenance or insurance!
Now if you had taken that same $10,175 a year or the car payment and had put it in an investment earning a meager 5% you would have over $70,000 in the bank!
I don’t know about you but that sounds much sexier to me! The reason people choose to go with the car is strictly from an emotional standpoint. Now if you have an Escalade and can afford it and don’t care, good for you! If you can’t afford it you might want to check out my article about saving money camping, as you might be living in your car one day!
This article was simply to point out that a vehicle is not an investment in your future. Do yourself a favor and pay yourself first. Make early retirement a reality.