This is so stupid. There is no correlation between people who drive nice cars/other bling and true wealth.
Most of these “luxury” cars are LEASED or paid via a LOAN, which is just another term for “RENT”.
For some who LEASE it makes sense because it can be written off as a business expense (IE realtors, salesman,etc)…
But not withstanding this former group, a good portion of folks LEASE/or make loan payments on these luxury brands because they can’t otherwise afford the luxury. The other thinking, from what I have heard numerous times at cooler talk is that “well, since I can’t afford the monthly to purchase a home, might as well make the monthly payments for a nice car”….proving once again why Americans are so piss poor…Folks like to think in terms of “affordability” meaning if they can make monthly payments….If I can make payments, then it’s ok to have that thing. Forget about savings. Forget about IF the shit hits the fan and one loses a job/account/contract/etc. Forget about the possibility of unexpected expenses for health bills/lawsuits/etc. As long as I can make payments now and keep my effective savings rate at $0/month, I’m good. By gosh, I deserve a nice car. I deserve it.
(Of course, when the shit hits the fan, it’s “oh, how could this have happened?? I need a government bailout…Go figure..)
Personally, I think it’s, well dumb use of money, LEASE/take out a loan on a ubber expensive “luxury” car for which you couldn’t write off as a business expense, since probably 95% of all cars (luxury included) is a guaranteed depreciating asset, especially high end cars like Mercedes S class, BMW 6/7 series, and Audi A8/S8, which time and time again have proven can loose 45% value within the first 2.5-3 years of ownership, since most of these higher end cars end up being lease returns and/or traded in (since real wealthy people who end up swapping these for latest and greatest) AND also the fact that these “top end” brands end up being money pits in terms of service/reliability after 4 years of ownership.
The exception would be “enthusiast/performance” vehicles for which there is a decent secondary demand for those vehicles and/or people do want to keep those cars because of their novelty (IE Mercedes AMG series, BMW M series, Audi RS/S series), and it is entirely possible to see one of these more for what one has paid for (I.E. I have a friend that buys E90 M3’s drives them for 3-4 months, and ships them back to taiwan for a profit).
But again, that’s just humble opinion. Just like I choose to have no debt for all my cars….
BTW, some folks like to scoff at all those folks that drive a econ box like my neighbor…but I’m pretty confident to say that some of the weathiest people drive the biggest P.O.S.
