- So we talk about living debt-free a lot.
And it's super, super important because, not only does
that just give you peace of mind and freedom,
but it helps you build wealth later on in life.
So if your income comes right back to you,
then you're able to take your income,
and you're able to invest it,
give it, spend it.
It's all up to you because you are in control of your money,
versus having tons of debt payments,
and all your income is going right back out to other people.
Well, we go through credit cards,
we go through student loans, car loans, personal loans,
family loans, like all of them.
They all have
their level of heaviness,
and like mathematical sadness, we could say.
But the one type of debt that just, logically, I just can't,
just can't get there: car loans.
The old car loan.
Because here's the deal, the moment you buy a new car,
and you just (car honking) (snaps fingers)
it's lost value, already, automatically.
It's gone down in value.
Now, if you have a million-dollar net worth,
I always say, then you can afford the hit,
you can afford taking that loss.
And it's not gonna do much to you long term.
Like you're fine.
But
those of you that don't have a million-dollar net worth,
and especially those of you that
are taking a loan out to get that car,
drive it off a lot,
it goes down in value,
but you continue to make payments,
as if it's a brand-new car, for years and years and years.
And then, on top of that,
you are paying interest,
extra money, if you will,
on something that is going down in value.
So you're paying more than sticker price over the term
of your loan
for something that is gonna be worth so much less
than when you bought it.
Financially, it's just tough.
And then, emotionally, I know it's tough
because people love their cars.
The idea of driving a nice car,
it like gives the average American
this just like boost of confidence.
People just love their cars.
Their identity is in their car.
Like they have something about cars, it's unbelievable.
And people just say, okay, yeah,
if you drive a nice car, automatically, you're successful.
I mean, it is such a wild thing.
So, for me,
I'm just not a huge, huge car person.
Like, I can appreciate a nice car, sure.
But it's one of those things I'm like,
it takes you to point A to point B.
And then if you have kids,
good Lord, have mercy.
It's like jelly and goldfish crackers.
I mean, it's disgusting, absolutely disgusting,
of how your car ends up anyways.
So, for me, I'm like, I don't get it mathematically.
And I don't really even understand it culturally.
Again,
I mean, I drive a minivan I love a minivan.
I think it's fantastic.
That's the kind of car person I am.
But when I talk about this,
a lot people always are freaked out because like, well,
I don't wanna drive a used car
because it needs to be reliable.
Like used cars are just not as reliable.
Guys, that's crap.
That is not true.
You can buy nice,
affordable, reliable, used cars.
So, according to Kelley Blue Book,
there are lots
of really nice, great cars
that can take you to point A
to point B for under $8,000.
Are you ready?
2010,
that's pretty good year,
Subaru Outback.
I look at people's Subarus,
and, again, I'm falling into my own...
I was just talking about it a second ago,
but I'm like, they love the environment.
That's what I always think about Subaru people.
2011 Mazda3.
Mazda, great car.
2011 Nissan Maxima.
I see those on the road,
and I just think, that was a smart purchase,
whoever's driving that car.
2009 Toyota Avalon. Freaking love Toyota.
(exclaims) Toyota's the best.
2011 Honda Civic.
Classic, great car.
2010 Toyota Corolla. Hey, Toyota.
2010 Honda Accord. Honda, again.
These are all great cars.
2011 Toyota Camry.
Y'all,
you can drive these cars forever,
like, hundreds of thousands of miles.
And I've already said it.
I'm not a car person.
So some of you will be like, Rachel, that is not true.
But I mean, if I saw that Honda Civic out there,
I'll be like, I won't know that's a 2011.
I wouldn't even know it's a 2016 or a 2019 or 2007.
Like, I don't know, like, it's like, guys, it's just a car.
It's just a car.
And the fact that just a car puts people in so much debt
drives me
insane.
So listen, you can buy reliable used cars
under $8,000 by the way, these.
And that was such an easy find.
That's such an easy find.
You can find inexpensive cars everywhere that are good
and reliable. I'm telling you.
So, do not fall into the trap of like,
oh, I have to have a nice car.
It's just what you do.
You just have to have a nice car.
No, you just need a car that's gonna get you
to point A to point B.
And then, when you're out of debt,
you got your emergency fund, you fund the retirement,
you wanna save up a little on the side and upgrade car,
good for you. Go upgrade car.
And when you become a millionaire,
you wanna go buy a brand new car, good for you,
go buy a brand-new car.
But when you don't have million dollars,
you don't have cash to buy a car,
then you don't need to buy one, okay?
You have to save.
You have to focus and be intentional.
So avoid the car loan, please, please, please.
Car leases, all of it.
Just save up.
Get a great car that's gonna be reliable,
and it's gonna help you win long term with your money.
(exclaims) Because when you have no debts,
you have freedom, and you're able to build wealth, again,
to go buy a nicer car later on.
(upbeat music)