Thursday, July 30, 2009

Beware of the "Cash for Clunkers" Bill

Everyone is talking about the new "Cash for Clunkers" bill, but becareful or you might be sorry. The Cash for Clunkers voucher is great if you are already looking to buy a new car. It’s important to remember that getting a good deal on a new car doesn’t automatically mean that you can afford it.

I have a old Ford "Exploder" with 160K miles on its last leg, and want to buy a new F150 4x4. I considered trading in my clunker, but decided to pass it up because spending money to save money is pointless, when it equals a net loss.

Don't get me wrong, I would love to drive around in a brand new truck, but I know better than to bring unneeded financial stress on myself and my family. I don’t need another car payment. Instead I will build up my emergency savings, and payoff my credit card debt. When my clunker does die in the near future, I will probably buy a cheap used truck for a lot less than the price of a new car with the voucher.

Don’t get suckered into buying something you can’t afford because it’s on sale.

1 comment:

M.Wanzer said...

Your statement, "Don’t get suckered into buying something you can’t afford because it’s on sale." is classic. That is definitely something people need to take into account when they think about making use of this program. Even with the 4500 off, you still may come out ahead buying a used car and selling that "clunker" on your own, especially if that new car note is not in budget. Great Assessment.