The Million Dollar Car
How to replace your car loan with an investment plan to buy and replace cars for life.
Debt is driving our car industry
Australian’s have an appetite for new wheels, with over $8 billion borrowed each year for cars. The interest on this debt alone exceeds $500 million annually.
The average car loan is in Australia $31,738 - across all age groups.
This is a problem.
We’re being marketed to that our cars need upgrading every 3, 5, 7 years and that it’s ‘normal’ to have a car loan or lease. The choice to get car finance is designed to be easy, with the aim to sell you more vehicles - no matter the cost.
The solution…
Take a new path and replace the car loan with a cash system. Set money aside (systematically) into income and growth producing assets to buy future cars. Then wave goodbye to car debt forever!
What does it cost to buy a car?
Most Australians purchase cars through one of three ways; saving-to-buy, personal debt or consolidating debt through the home loan.
Comparing the costs, saving cash ($345 per month) or taking out a car loan ($468 per month) is far more expensive than if you were to invest your money and ‘create to buy’ ($268 per month).
““Instead of working for the bank’s profit, put your own money to work””
Using debt -vs- investing to create income assets
Instead of taking out a car loan, what could you achieve if you bought income and growth assets with the equivalent loan repayments ($468 per month) over the same period…
““You only need to take a series of tiny steps, consistently, over time, to radically improve your life.” ”
The million dollar car strategy
By continually purchasing income and growth assets at $468 per month over your working life, you could fund a new car purchase every 10 years, and generate wealth.
After 40 years, you have paid cash for four cars and built a substantial set of income producing assets that will continue to grow with a compounding effect.
In summary…
We can reap huge rewards in life from a series of small, consistent, daily choices. This includes how we pay for our current and future cars.
““Compound interest is the 8th wonder of the world. He who understands it, earns it; he who doesn’t, pays for it” ”
The decisions we make today will determine our tomorrow.
Car loan? No thanks… Choose the million dollar car!
Did this spark some questions?
No doubt this has got you thinking how much your car could really be costing you!
Connect with one of our Financial Advocates online and talk about how you can achieve your goals, including the Million Dollar Car.
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Assumptions: 8% av. investment return annualised over 7 years. Tax and inflation not considered. All investment income is reinvested.
Disclaimer: Any advice contained in this document is General Advice and does not take into account your objectives, financial situation or needs. Before acting on any General Advice, you should consider whether it is appropriate in light of your particular objectives, financial situation or needs. If the advice relates to acquiring a particular financial product, you should obtain and consider the Product Disclosure Statement (PDS) for that product before making any decisions.
