5 Reasons Why I Didn’t Buy A Brand New Luxury Car
I graduated college and landed what many would consider a “dream job” making over a $60,000 a year salary. I realized early on that achieving financial freedom is at the core of everything that I do. That is my bottom line, point blank, period. I highly doubt achieving financial freedom within the first 3-5 years of graduating college is on the priority list of many young 20 somethings. I know for sure that new college graduates making at least that much money fresh out of school value buying a brand new luxury car such as a Mercedes Benz, BMW, or Audi over financial freedom.
Why I chose financial freedom over a brand new Luxury car?
I value my net worth.
Like hundreds of thousands or even millions of other college graduates, I entered the real world with student loan debt. My wife and I together are about $50,000 in debt. What a way to start your adult life! Net worth is equal to assets minus liabilities. In order for me to have my net worth above $1 million, I need to get out of debt. There’s no ifs, ands, or buts about it; I need to get out of debt, well bad debt. A brand new luxury car would put an additional $30,000 plus debt over my head making me at least $80,000 in debt. Simple math, but many fail to think about the additional price tag on top the already heavy student loan debt. Once I’m out of debt, I will be financially free and can then focus solely on growing my assets via business and investments.
Possessions don’t equate to success.
So many people believe the more you have, the happier you’ll be. I think the more you have, the more you’re going to want to have. You’re going to want to do bigger, better, faster. There’s a price tag for everything in this world. Majority of the people out there who have a lot of possessions can’t even afford it, and are in tons of debts. They look successful, but when you see their bank account or balance sheet, their struggling just like everyone else. Just because you can make payments on something doesn’t necessarily mean you can afford it. I refuse to be that person. Success to me would be me becoming a millionaire by 30, not driving a brand new Mercedes Benz to look cool.
Would’ve taken a lot longer to achieve my goal of financial freedom.
I desire to be financially free in the near future, and I know that paying extreme amounts of money every single month while being in tens of thousands of dollars in debt will prolong the crap out of my journey to reaching financial freedom. I refuse to take that risk. If I have a goal, I can’t let anything get in the way of me achieving that goal.
The money I would’ve spent on a car loan is being invested into my business.
To achieve financial freedom in the next 3-5 years, I cannot rely solely on my day job. That’s the main reason why so many people struggle today. It doesn’t matter how high my salary is, Uncle Sam will always continue to take huge chunks out of my paycheck every 2 weeks, and as long as I’m considered an employee, I will never see over 60% of my paycheck. My business that I’m working on on the side will help me reach my goal of being financially free. So, instead of me paying $600 plus per month for a car, that money is being used to bootstrap my business which in turn will make me tons of money.
A car isn’t an asset.
I firmly believe in Robert Kyosaki’s principle that an asset is something that makes you money. In other words, money is flowing into your pockets as opposed to flowing out. With that being said, spending $30,000 plus or paying $600 plus every month wouldn’t consider a car an asset. Also, the moment that car is driven off the lot, it instantly loses it’s worth, meaning I’m losing even more money because I would still be paying for something that doesn’t have the same value when I purchased it (red flag). As I stated above, the money that could go toward a luxury car is going toward my business, which is considered a true asset because it will make me my millions.