Overhaulin'

Is it a very wise decision to buy a new car (with cash) with the economy falling apart?

Does anyone know the answer to this? I'm about to buy a car, but if the economy is going to collapse, wouldn't it be better to buy AFTER to get a car real cheap? Or, if the dollar loses value, would i even be able to buy a car...wouldn't i be more worried about using my $10 to buy bread???

Public Comments

1. ►Is it a very wise decision to buy a new car (with cash) with the economy falling apart? ◄ ...No. Once you drive a car off the lot, it loses 20% of its market value; i.e., if you tried to take it back a week later, you would only get (say) $8,000 for it if you'd paid $10,000 earlier. I would not only wait until the recession bottomed out, I might actually check out CAR AUCTIONS in the local paper. Police routinely have auctions of cars that have been seized or repossessed by the sheriff's office. Go to one or two and see how much a 2-year-old car will go for, then be prepared to spend that much money in cash or credit at the next auction.
2. It is always wiser to buy with cash than to buy on credit — you'll save a ton on interest. Although the economy is in a recession, this is part of the normal cycle, and I think it's alarmist to categorize it as "falling apart." At the moment, inflation is flat, but it is expected to increase. So your car is unlikely to get any cheaper. If anything, a "collapse" is more likely to cause more inflation, not lower prices. To get the most from your dollar, buy a car that is slightly used. Then you don't take a hit on the depreciation. I've always gotten deals at CarMax www.carmax.com.
3. if you really need one go ahead. if you can afford to pay in cash it's good, but if you want on credit it doesnt really matter. go for high equity so your monthly isn't too big. the real decision is what kind of car to buy? With the falling economy and rising oil it is wise to buy a really fuel efficient vehicle. Hybrid is preferred