This past week, I attended a large car auction in AZ with my parents who were visiting from South Dakota. The week-long event brought in 300,000 visitors, auctioning off 1,900 vehicles, and was expected to surpass $200 million in total sales.
The most expensive car last week sold for $2,750,000.
The entire event reminded me of a quote I find most often attributed to Harvey Mackay. The quote has significantly influenced my life.
“If you can afford a fancy car, you can make more of an impact driving an ordinary one.” —Harvey Mackay
Let’s be clear, I know nothing of the people who bought vehicles at the auction I attended. And I know nothing of their motivation. This article isn’t about them—it’s about me. And maybe about you if you want.
Harvey’s quote is a helpful guiding principle in all walks of life—automobiles being one of the most important.
In our society, people are obsessed over cars. Not all people, of course, but many. To a point, this makes sense. We have built many of our cities and towns in such a way that vehicle ownership is generally assumed.
But our fascination with vehicles goes well beyond our need for them. In our culture, they represent far more than a tool to move from Point A to Point B.
The statistics concerning vehicle use and expense seem to back-up the premise that the cars we drive are no longer just about getting from one place to another.
According to the U.S. Department of Transportation, the average annual cost of owning an automabile in 2022 was $10,729.
On average, car ownership and operating expenditures represents the second most significant expense for households representing 16% of annual income (housing ranks #1 at 34% and food ranks #3 at 12%).
The average auto loan for a new vehicle is over $41,000. And the average used car loan comes in at $28,500. That’s a whole lot of money.
A financial advisor once mentioned to me in passing, “There are three things that often lead people into debt or financial hardship: too much house, too much car, or too much dining out. This may be an overgeneralization, but most families who get a handle on these three factors, tend to make budgets that work.”
Looking past the simple economics of the matter, there are other factors in play in choosing the vehicles we drive.
Owning a car has become about something far greater than the necessity of transportation. For many people, they are the ultimate idol.
Car ownership has become very much about status and reputation. We seek to prove our success in society by the car we choose to drive.
Car manufacturers have intentionally fueled this thinking. Over the course of decades, some car brands have successfully positioned themselves as status symbols on the road. This is not necessarily because of the quality of the workmanship, sometimes it is merely a result of shrewd branding.
Often times, even influence within certain occupations can compel us to purchase certain cars. I have a doctor friend who bought a Hyundai. Upon telling his physician peers about his choice, he recalls their immediate reaction and visual disgust over his choice, “Are you kidding? Why would you settle for a Hyundai? You are a doctor for goodness sake.”
In addition to status and cultural expectation, there are internal factors that can subtly determine the cars we drive.
We may be moved by the sake of nostalgia. We become addicted to the adrenaline rush of speed or power. The appeal of a certain vehicle has fascinated our affections for as long as we can remember (“I have always wanted to own a Mustang”).
Sometimes, the ownership of a specific vehicle is intended to heal wounds that have yet to close (this can especially be seen in some father-son relationships). For others, the love of engines and mechanics impacts the cars they pursue and purchase.
Years ago, I spoke at a church in Phoenix, AZ on the life-giving pursuit of minimalism. On this particular Sunday, I invited anyone with personal questions to find me in the lobby afterwards.
Many did. And the typical questions were asked: “What about my kids? What about my spouse? What about my sentimental items?” Etc.
Towards the end of the morning, after everyone had left, one young gentleman remained. He approached me and presented his dilemma.
“Joshua, I agree with everything you said. In fact, I live a pretty minimalist life already. But I just have one question. I’d really like to own a nice car. I mean, I really, really want to own a nice car when I can. Is that wrong?”
His question was complicated—on many levels. For starters, I am not in any position to determine the rightness and wrongness of any purchase. Most of those answers generate from our motivations behind each purchase. I was in no position to determine which motivation was directing him. On the other hand, he was at a church and on some level, he would probably agree that pursuing the things of God is more important than pursuing the things of this world.
Two thoughts raced through my mind.
First of all, his desire for a nice car was clearly controlling him rather than him controlling the thought. His facial expression, tone, and even the question itself communicated this to me. Inherent in his dilemma, was the reality that he felt compelled to own a really nice car at some point in his life. Almost, as if, for some reason, he didn’t think he could change this desire even if he wanted. One of the motivations above had taken control of him.
Secondly, I was reminded immediately of the thought process spurred by Harvey’s quote above, “If you can afford a fancy car, you can make more of an impact driving an ordinary one.”
Rather than offering any specific answer to his question or instruction on how much money should be spent, I simply invited him to consider the fact that his money and life may be spent on more valuable pursuits than fancy cars.
In my own life, I try to balance my pursuit of minimalism and my need for transportation with these three questions.
1. Do I need a different vehicle? If not, why do I want a new vehicle? And is that a good enough reason to spend the resources?
2. How much cash + trade-in have I saved? One of the best pieces of financial advice I ever received was, “Always, always buy your vehicles with cash.” Despite a modest income my entire life, I have never carried a car payment. The freedom you will experience not having the monthly payment is well worth the sacrifice of never driving a new car off the lot. Trust me, you won’t regret it.
3. What are the additional expenses associated with this purchase? Calculate insurance, gasoline, anticipated maintenance, and unique circumstances (parking, tolls). Factor these into your decision by comparing several models. Sometimes a vehicle may cost more upfront, but save money in the long run.
We live in the 21st Century. Unless you live in a location with convenient public transportation, you will almost certainly need to own a vehicle. But that doesn’t mean you need to own the vehicle marketing teams compel you to purchase.
Instead, you’ll be better off owning a vehicle that provides you with the freedom, the reliability, and the resources to accomplish the greatest amount of good in this world with the one life that you have to live.
Rebecca says
20 years ago I bought a new Kia Rio.It was a demonstration car which the dealer used for customers to test drive so had very low klms(I’m Australian) and was thousands of dollars cheaper than the brand new ones.It was only a few months old.I still drive it everywhere today and it’s been very reliable though doesn’t look perfect.Sadly I have felt a bit of judgement for my old car,no one has ever said they liked it, well not in the last 15 years.Mostly I don’t care,but sometimes I do.Be good if people were a bit more positive about owning older vehicles.
Heather says
I drive a Tesla right now. Paid cash not that it matters to anyone. My first car was over 250k miles and that doesn’t matter either. The Tesla is super quiet and the technology is helpful in many ways. It works for me where we are now because I have a garage to charge in. No, the EV system is not built for cross country travel yet, and it isn’t to the point that it is smart for everyone. We bought it because we were interested, and also to support technological advances. I don’t see the point in driving a junky car just to wear it like a badge of honor, and the same with a fancy car. I thought the point of minimalism was to make room in your life for what matters to you, what makes sense for you. None of us need to judge each other for anything. It just isn’t helpful.
Kathy says
We just gave our granddaughter our 2004 Honda Element with 225,000 miles. We loved that car. However my friend got a brand new Toyota Rav. Her old 2012 Toyota Rav had 116,000 miles on it. I asked her if we could buy it from her. So we now have that car that is in great shape.
We paid $10,250.00 in cash
Kathy says
We just gave our granddaughter our 2004 Honda Element with 225,000 miles. We loved that car. However my friend got a brand new Toyota Rav. Her old 2012 Toyota Rav had 116,000 miles on it. I asked her if we could buy it from her. So we now have that car that is in great shape.
Barbara says
My 2005 Toyota Corolla with 175,000 was going strong, and I debated if I should get something new when the decision was taken out of my hands. Got hit hard and the car was totalled. I was lucky, with the dearth of inventory when this happened (December 22), to get a new 2022, wait for it… another Corolla. The first served me well and this should, too. I, too, liked the “too much house, too much car…” quote.
Brooke says
I feel like I’ll be a minority here, but I’ll offer a different perspective. I own a new car. I value minimizing my stress and disruption for car repairs. It’s electric and thus I minimize time getting gas. All this allows me to spend time doing what matters in my life. It’s not a top of the line car, but it serves my purposes, and having newer features like a backup camera has allowed me freedom to feel far more confident going places that require parallel parking, which living in a city has opened up quite a few opportunities to explore and experience. To quote Josh, “The goal of minimalism is not just to own less stuff. The goal is to unburden our lives so we can accomplish more.” Minimizing maintainence in all aspects of my life reduces demands on my time and anxiety.
Martin.... says
I purchase a cars $10,000 or less, no older than 10 yr
– Google reviews of cars 5-8 years old. I talk to mechanics
– Look for a car with less than 75,000km.
– Your trade in: probably $3000+
– Eg. You buy for $9000. Subtract $3000 Cost $6000
– Depreciation: $1400/yr. Repairs/?: $700/yr Total $2100
– After 3 yrs you drive for free. Insurance may be less. The tax is less. No shipment fee. No loans. Later you still can trade in for $3000.
I am 73 and I have driven cars for free 80% of the time.
I have had a 2009 Ford Escape great shape for 2½. yr.
Currently I am looking for a hybrid Subaru Forester or Honda CV-5 or Toyota CV for the next year or year later
Nanci says
Owning a safe and reliable car is important. That said, bicycling is better. (When I drive, I drive a 2003 Acura MDX purchased for driving my son and his soccer teams around. He is now almost 30) And, to protect the environment, I will be saving up for an electric vehicle, to purchase when my old car is no longer safe and reliable. As stewards of our planet, we all could think about driving less and getting off our addiction to fossil fuels.
Dawson Greenland says
I am feeling a little bit judged here! Status is not the only reason that people own high end cars. My husband and I are retired and live in New England. We have always put safety first which means 4 wheel or all wheel drive for driving in winter conditions. We usually buy our cars new and keep them until they die or are costing too much in maintenance. We have always driven them well into the 100’s and sometimes into the 200k’s. We have never bought more than we can comfortably afford but we have been fortunate enough to be able to afford luxury cars for many years. We usually have one nice car and one older car and have sometimes even had a third vehicle for utilitarian usage. I currently own a 2017 bmw suv with lots of life left. I drive it because I get pleasure out of it and I feel very safe in it and I can afford it. And I am not ashamed and I don’t care about status, I care about comfort. I don’t need to drive a lesser car to prove a point. My husband, who could well afford whatever car he wants, has chosen to drive a minivan for years. Granted, they aren’t exactly cheap once you get all wheel drive, etc. but they are sensible and last forever and no one is going to call it a status symbol. Once he retired he decided he didn’t really need a car and sold the van to one of our kids and he now drives my 13 year old pickup truck. Which was very nice when it was new but is now just a well worn safe truck. My point is…I don’t believe that everyone driving an expensive car is saying “look at me”. Whether or not one strives for minimalist values, one should be able to own nice things if they enjoy them and can afford them. I own a beautiful home with a high end kitchen and I have high end appliances because cooking is a passion. Most of my home is furnished very inexpensively because I love to buy secondhand and have many family heirlooms. I buy a lot of my clothing at Kohls and Walmart and buy my very few cosmetics and shampoos etc. at Walmart also. Designer clothes and expensive makeup do not interest me in the least. I can look great without them! It’s all priorities.
I have learned a lot from the minimalist movement and have changed many of my shopping habits. I took a one year hiatus from clothes shopping which helped me stop buying other unnecessary items too. I am slowly decluttering and trying to simplify my life so that I can have more time for the things that matter. And for me, so long as I can comfortably afford it, one of those things is a nice car to drive my grandchildren around in!!
Pat says
Hi, Dawson. I’ve thought about you since I read your post on January 30. I’m sorry you feel judged and hope maybe that will change. I can’t speak for others here, but I can say that I don’t think your cars reflect a need to show status. My thoughts are for those who think vehicles and houses are necessary to show they are successful but who often are in debt up to their neck to make the purchases. That’s really not my business, so I would never say a word to someone about that. On the other hand, I have had people make nasty remarks to me because my husband and I chose to build a 560 square foot home for retirement. We want less space to clean, cool/heat, and maintain. It serves us well. I’ve received snarky comments about my little car- a fifteen year old Toyota Yaris. I love my little car. Even with 237k miles on it, it gets great mileage, has low maintenance, and is easy to drive. It gets us where we need to go.
I’ve decided if people want to judge me, they can go right ahead. In the meantime, we are living a happy small life that is easy for us and, I hope, lighter on the planet. Your reasons for your vehicles seem sound for you and your husband. That’s what matters, I think. Best wishes to you.
IF - Impersonal Finances says
By and large, there’s no question that most people are spending way too much on their vehicles. At a certain point, you’re not driving to work, you’re working to drive. I paid a little more than I felt was fiscally responsible for a used Honda Accord, springing for one with relatively low miles and the fancy leather seats and all that up. So a Honda that I can trick myself into thinking is a luxury vehicle. For me, that struck the balance between responsible while serving as a little bit of a status symbol (more so than my previous jalopy at least).