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Talk about a rough road a recent study finds most middle class Americans can not afford a new car.
So how can you stretch your budget to get behind the wheel without driving into more debt.
Running away with a lot of metaphors here let's ask personal finance expert Dave Ramsey -- it.
Hey good morning how are you doing well also I was astonished to hear how much the average new car.
Dollars last year so it sounds like most Americans can't afford one.
Well and you know what the thing you can't afford is is that that 30000 dollars is gonna turn into about 101000 dollars and four years.
And so you're driving the most expensive thing that we purchase that goes down in value I'm not against someone having a nice car understood -- they're -- -- having them.
A good point so you have some tips for how people can get out of this sort of car racket the first when you say pay cash for a cheap car used to just about 2000 bucks you can get a car for that.
Well just get started is the point let's let's -- -- readjust our thinking in.
Go back to -- -- ways of thinking if you can't pay for it you can't afford it.
Some shocking idea but the cost of car payments is unbelievable so just for a short period a trying time drive that beater drive that -- -- and get -- a 2000 dollar car and get the process started.
To break the cycle of car payments.
My grandparents felt that way -- if that money wasn't under the mattress they couldn't afford it.
But meanwhile you say if you save 495.
Dollars every month what does that -- here.
Well that's the average car -- America today is of between 484495.
Dollars a month.
And of course that's a lot of money and when you to start multiplying that times a few months you've got some serious money.
In fact you say that in ten months you can have 5000 dollars in cash and then what do you recommend doing with the.
Well the good news about that 2000 dollar car is is that it didn't go down much -- -- -- it's pretty well done.
So we take that 2000 dollar car just less than a year later at our 5000 dollars cash where that we've got seven.
Thousand dollars but that's a whole lot better car than a 2000 dollar car do that a few more terms were in some serious car.
In fact you -- you do that every ten months your prescription.
You will soon be driving a very nice car that is paid for.
Well yeah let's just extrapolate that little basic sixth -- formula a little bit further insight.
Ten more months after a 7000 dollar car which about 121000.
Ten more months we get about 171010.
More months and now we're only thirty months two and a half years so shot up I mean and then you bought a 22000 dollar car.
Which is that 30000 dollar car one year old.
And want to get a new car every ten months I would imagine so that's not a bad -- that strategy.
Dave Randi thanks so much for the suggestions.
-- thank you good to be with you need to.
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