What kind of car do you drive?

Investor Mindset
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What kind of car do you drive?

Jeff Sims
Residential Real Estate Broker · Greensboro, NC · Member since 2015 · 14 posts · 68 votes

Just a fun post here. I have been a SFR investor for 15 years and now have $2M in rental RE while working a full time career. The cash flow was tight for years it seemed but the snowball of debt paydown is rolling big time now and I'll be able to "retire" in 2 years with enough cash flow to replace my salary.

That said, I can't imagine having a car payment and only buy used vehicles. I drove a 1999 Jeep Grand Cherokee (to haul all my rental supplies) for 7 years and the engine blew a year ago with 275k miles. I made a significant upgrade and replaced it with a 2000 Jeep Grand Cherokee with 110k miles and paid $3,600 cash.

I don't need the status symbol of a new vehicle nor the monthly payment and living well below my means is my motto. As Dave Ramsey says, "live like no one else today, so you can live like no one else tomorrow".

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Roy N.Pro Member
Rental Property Investor · Fredericton, New Brunswick · Member since 2013 · 7k+ posts · 4k+ votes
11y

My preferred ride:

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  • Earl Jefferson
    Vacaville, CA · Member since 2014 · 12 posts · 0 votes
    11y

    Bought a 2014 Camaro just to deploy and leave the country.. Shame right?

    0Reply
  • Tony Gonzalez
    Renter · Jersey City, NJ · Member since 2014 · 38 posts · 13 votes
    11y

    Yikes. Well my partner and I just financed a used 2007 GMC Acadia. Traded in a 2001 Toyota Avalon, it had 178K miles, busted side mirror, and the trunk stopped closing after I bumped it backing out the garage. I'm planning to pay off the new (used) car by end of next year.

    0Reply
  • Devin Morgan
    Baltimore, MD · Member since 2014 · 91 posts · 49 votes
    11y

    I drive a 99 Mercury Mountaineer. Wouldnt have it any other way right now.

    0Reply
  • Sean McFadden
    Real Estate Investor · Finleyville, PA · Member since 2014 · 20 posts · 2 votes
    11y

    I was really dumb the past two years. I had a totally paid off 2002 BMW 325i.... my first car had since I was 17. I graduated college and got a new fancy job with tons of travel so I bought a new loaded 2013 VW GLI. The GLI fell apart with in the six months/ 20k miles of ownership so I took a 6k loss (really dumb) for a 2012 BMW 3-series coupe. I just got out of that for two reasons 1) a $500 monthly payment....... 2) it was totally useless. I came back to earth. I was able to recoop some of my negative and picked up a 2008 BMW X3. Yes, I still have payments but my monthly obligation dropped $200 a month, but continuing my $500 month payment it will be paid for in 2.5 years. 

    What have I learned. I have successfully had 3 cars made by the same manufacturer and I am too spontaneous. This X3 now holds boxes and I will drive it till it is dead.

    2002 BMW - Should have kept

     2013 VW GLI - Clearly I was delusional here, POS

    2012 328i - too expense for uselessness

    2008 BMW X3 - basically my white car as an suv

    0Reply
  • Robert G.
    Residential Real Estate Agent · Miami, FL · Member since 2013 · 195 posts · 138 votes
    11y

    I lease every 3 years, and I don't see the problem with it.

    I always have a new car.  I get to drive a nicer car for the same amount of money.  I have zero maintenance, repair, or warranty concerns.  I've never broken down or been stranded (which in my experience rarely happens with new cars).

    The cost of all this?  An expense of about $11 a day.  And I'm fine with that.  I see my car as a vital tool in my business(es).  Relatively, that is a minor expense for the reliability, safety, and convenience of driving a new car, in my opinion. 

    4Reply
  • Seneca Stephens
    Greensboro, NC · Member since 2013 · 31 posts · 5 votes
    11y

    A hand-me-down (my brother's old car) 2001 Chevy Malibu with 20" rims. Right now it's got just under 128k miles on it. Once I can get my head fully wrapped around REI (need to physically "see" things) and when this car kicks the bucket for good I would like to purchase something new, some thing I can claim I bought and feel good about.

    0Reply
  • Richard W.Pro Member
    Lender · Los Angeles · Member since 2013 · 63 posts · 33 votes
    11y

    My 2002 BMW is due for a change soon, but more interesting is this story about a Pro Bowl NFL running back who drives a 1991 Mazda he bought for $2.  Just a little motivation I use to keep my "wants" in check with my "Needs".....enjoy

    Alfred Morris 1991 Mazda

    3Reply
  • Jeremy Jackson
    Real Estate Agent · Brandenburg, KY · Member since 2015 · 277 posts · 68 votes
    11y

    04 Dodge 2500 diesel. 21 mpg (great for a truck).  I plan on owning it til it falls apart.  134k miles on it. 5.9 cummins will move a house!  

    0Reply
  • Mark Esposito
    Raleigh, NC · Member since 2014 · 125 posts · 37 votes
    11y
    Originally posted by @Jeff Sims:

    Just a fun post here. I have been a SFR investor for 15 years and now have $2M in rental RE while working a full time career. The cash flow was tight for years it seemed but the snowball of debt paydown is rolling big time now and I'll be able to "retire" in 2 years with enough cash flow to replace my salary.

    That said, I can't imagine having a car payment and only buy used vehicles. I drove a 1999 Jeep Grand Cherokee (to haul all my rental supplies) for 7 years and the engine blew a year ago with 275k miles. I made a significant upgrade and replaced it with a 2000 Jeep Grand Cherokee with 110k miles and paid $3,600 cash.

    I don't need the status symbol of a new vehicle nor the monthly payment and living well below my means is my motto. As Dave Ramsey says, "live like no one else today, so you can live like no one else tomorrow".

     Jeff,

    Great post. Glad REI is working out for you (y'all).

    I've been driving Jeep Cherokees &  Grand Cherokees for a while.  I like to 4WD and find them cost effective and pretty much reliable (although I did blow one up with the 2.8 V-6 - a bad fit). The in-line 4.0 '6' has a proven track record of reliability. I avoid the V-8.  I've had 4 used car dealerships over the years and buy a lot from Greensboro Auction on Wendover Ave. I always keep an eye out for Jeeps Grand Cherokees...at a good price of course. I MAKE $$$ with cars.

    Now I'm into REI. I like the motto: 2 cars in every garage. Buy the house and I'll throw in the cars.

    But people's impression of us is judged by what we drive.  So... I also drive a Lincoln 'Executive Limo' (mine) black, of course, and a Lexus Hybrid (hers)...and a 'beater of the month' to go downtown to the DMV and Courthouse in and not care because I don't have to 'back down' or otherwise worry about the infinite number of jerks downtown who just as soon see you crash & burn. I don't have a car payment either.

    BTW I 'retired' at 25 but came 'out' of retirement at 30.  I plan on having 'fun' 'till the end!

    Cheers.

    P.S. If you need another Jeep.... (Oops...web guys i'm NOT promoting any business)

    0Reply
  • Mark Esposito
    Raleigh, NC · Member since 2014 · 125 posts · 37 votes
    11y
    Originally posted by @Zach Mitchell:

    Can someone tell me how it makes more sense to pay cash ($20k+) for a car when you can get loans at 2.5% for 60 months? If you have $30k for a car and are able to put down $3k and finance the remaing $27k at 2.5%, that leaves you with $27,000 cash to go out and make a return well above 2.5%. You make even 3.5% ANNUALLY on that money and you have essentially borrowed free money and made an additional 1% on it. I will never understand why people are against borrowing free money. 

     Buying a new car is just burning cash...if one has it to burn great.  Cars are depreciable assets.  Don't get me wrong...its FUN to just BURN cash.

    But I'm too frugal to do that.  I'd give more to HELP those less fortunate than me to HELP themselves - learn how to earn $$$...not just feed them. 

    0Reply
  • Zach Mitchell
    Investor · Orlando, FL · Member since 2012 · 183 posts · 155 votes
    11y
    Originally posted by @Mark Esposito:
    Originally posted by @Zach Mitchell:

    Can someone tell me how it makes more sense to pay cash ($20k+) for a car when you can get loans at 2.5% for 60 months? If you have $30k for a car and are able to put down $3k and finance the remaing $27k at 2.5%, that leaves you with $27,000 cash to go out and make a return well above 2.5%. You make even 3.5% ANNUALLY on that money and you have essentially borrowed free money and made an additional 1% on it. I will never understand why people are against borrowing free money. 

     Buying a new car is just burning cash...if one has it to burn great.  Cars are depreciable assets.  Don't get me wrong...its FUN to just BURN cash.

    But I'm too frugal to do that.  I'd give more to HELP those less fortunate than me to HELP themselves - learn how to earn $$$...not just feed them. 

    Mark, I agree with some of your points; however, the question wasn't answered one bit. Also, just to clarify, I wasn't necessarily talking about a new car. Applies to used as well. 

    1Reply
  • Jon Holdman
    Rental Property Investor · Mercer Island, WA · Member since 2008 · 22k+ posts · 14k+ votes
    11y

    OK, I like things with motors and wheels.  I have a 2000 Nissan Xterra that does the heavy lifting and gets me through the snow.   One of the few vehicles I've bought new.  A 2005 Triumph Speedmaster for when the weather is nice.  A 2008 Mustang GT for in between and for the track.  The Mrs. has a 2007 Camry, the sporty one with the V6.

    If we're going to dream, I'll take one of these when they come out next year:

    2016 Ford GT.  Estimated to sell for $250K when they come out.  Now if I can just get to a new worth of $25 million to be able to justify such a toy.

    3Reply
  • Mark Freeman
    Real Estate Investor · Clovis, CA · Member since 2014 · 195 posts · 194 votes
    11y
    Originally posted by @Richard W.:

    My 2002 BMW is due for a change soon, but more interesting is this story about a Pro Bowl NFL running back who drives a 1991 Mazda he bought for $2.  Just a little motivation I use to keep my "wants" in check with my "Needs".....enjoy

    Alfred Morris 1991 Mazda

     Loved that Alfred Morris Mazda story!!

    0Reply
  • Chuck W.
    Real Estate Investor · salem, OR · Member since 2013 · 105 posts · 32 votes
    11y
    I was worth a million and used to drive beat up old Volvo station wagon. All my real estate agent friends were in debt up to their ears, but drove expensive imported cars so they look good. Unless the car is a classic, they are depreciating assets good for nothing more than stroking your ego
    3Reply
  • John HornerPro Member
    Flipper/Rehabber · Columbus, OH · Member since 2013 · 1k+ posts · 655 votes
    11y

    Ha absolutely love this post!  I actually take price in having the self control to continue driving my 2003 Chevy Impala with 150k miles even though I have the money for something better.

    Everyone I work with at the day job have purchased brand new cars with huge payments.  I see that as a life sentence.  

    Freedom of time > Material Things!

    2Reply
  • Katherine T.
    Real estate investor · Alabaster, AL · Member since 2014 · 94 posts · 15 votes
    11y

    I too have had the car debate with family and friends not to mention the silent stares from co-workers who expect a me to be driving in style based on my JOB title.  Presently driving a 190 K Honda Oddessy.  But oh no, I know where  my priorities lie...   financial peace/ freedom with my time.  So glad to know I am not alone... New in RE and yes this is a goal that seems far fetched presently, yet very attainable.  Thanks for all BP comments; very encouraging.

    1Reply
  • Don Harris
    Realtor · Charlotte, NC · Member since 2014 · 935 posts · 467 votes
    11y

    love this thread, I have been in the automotive business all my life. I've been in management in a new car store, large national auto auction company, owned a large used car dealership and work with a new automotive startup. I've owned and driven almost every vehicle sold in the last 30 years. ive personally purchased thousands of them that my business sold. My favorite car is .........my boat. 

    1Reply
  • Engelo RumoraBusiness Member
    Investor · Toledo, OH · Member since 2013 · 4k+ posts · 2k+ votes
    11y
    Originally posted by @Joshua J Bowen:

    My wife and I do everything possible to live below our means. Shopping at Aldi, auctions, clearence items. We sold our home and paid cash for a foreclosure that we are slowly fixing so we could eliminate a house payment. I drive a 2003 Ford Ranger with 181k miles. It has 4 wheel drive options so its good for our northern Ohio winters. She drives a 2014 Ford Transit Connect that seats 7 only because we have 3 daughters and its great on gas. My grandfather retired from Ford so we got a sizeable discount. My goal is to have it paid off by the end of the year. 

    Joshy,

    Its a pleasure having you on here mate haha

    Welcome to receiving 30+ emails from Bigger Pockets every morning now when your keywords are triggered haha.

    Now BP will bu your 12hr days to 14hr days easy haha

    Grazie and see ya tomorrow :)

    Podcast Guest on Show #89
    Oz Realty4.5369 Reviews
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    0Reply
  • Shawn Dandridge
    Investor · Houston, TX · Member since 2011 · 209 posts · 56 votes
    11y

    2014 Mercedes C250 coupe fully loaded

    0Reply
  • Sylvia B.
    Rental Property Investor · Douglas County, MO · Member since 2014 · 1k+ posts · 1k+ votes
    11y

    Here is me with my "new" car almost exactly 2 years ago.

    2006 CRV with <40,000 miles.

    Here's Hubby's Silverado a couple of months later.

    1Reply
  • Brian Albelli
    Effort, PA · Member since 2015 · 19 posts · 63 votes
    11y

    I don't get the whole "buying new cars is like burning cash" and the "cars depreciate" mentality. Some posters have openly said they are embarrassed to show up in the vehicles. People, you don't have to live like this!!! Everything you buy…furniture, clothes, televisions, jewelry, stereos, cellphones, computers….everything depreciates so where does it end? Even Real Estate can depreciate. Just in my little area, there are Toll Brother built homes here bought in 05 for 900k, selling for 250k…..not to mention every house value literally cut in half since the housing crash. You think everyone is feeling good about penny pinching and being embarrassed by their cheap cars so they could "invest" in those "appreciating assets"???? Wheres it end? Do you also live in a mobile home so you can put the rest of your income into appreciating assets? Its fine to live like that, but don't put down people for enjoying the finer things in life. Life sentence because I have a car payment???? Thats silly. 

    2Reply
  • Jared Tillery
    Investor · Milwaukee, WI · Member since 2014 · 30 posts · 14 votes
    11y

    1988 Toyata P/U with 156K on it.  I even have collector plates on it to help with costs.  The 22R engine is one of the best I have ever heard of.

    I like hearing that so many of the investors on BP have used, higher millage vehicles and love driving them.  

    1Reply
  • Craig Wilcox
    Investor · TN · Member since 2014 · 508 posts · 167 votes
    11y

    I retired the 98 Forester last year with 270k.   I bought it in 2007 with 115k and it never failed to get me home.  I hauled just about everything in it like lumber, tools, appliances, snow shovels, a trampoline, kids, etc.

    I traded it for a slightly used Prius which saves me quite a bit of cash on my 60 mile commute to my W-2 (until I longer need it).

    0Reply
  • Matthew Paul
    Severna Park, MD · Member since 2013 · 7k+ posts · 7k+ votes
    11y

    Funny thing is my tenants drive nicer cars than me . 

    8Reply
  • Jeff Sims
    OP
    Residential Real Estate Broker · Greensboro, NC · Member since 2015 · 14 posts · 68 votes
    11y

    No prison sentence for a car payment Brian. I created this post for fun and to get a pulse on the financial mentality of fellow RE investors. That you have been successful in the car care franchise and restaurant has blessed you with I imagine, significant amounts of cash to allow you to purchase a stable full of nice vehicles. Congrats and enjoy the fruits of your labor.

    For me it's more economics - I really can't afford $500, $1000, $1500 monthly car payments and stay in the black. Would I like to own a fancy new car that can outrun anything around - absolutely. I'm just not there yet. So what motivates me? For me it's the ability to have the financial freedom to do whatever I want with my time (family, travel, volunteer for a worthy cause, etc.) and know that the passive income from RE is funding my lifestyle for the rest of my life.

    You're the carpe diem guy - live for the day! Nothing wrong with that. I actually take pride in my modest choice of vehicles and think it sets a good example for my family (with 2 kids 11 and 13) to live within our means. Trying to keep up and get ahead of the Joneses - not my thing. Counting my Benjamins rolling in 24/7 - that's what motivates me.

    4Reply
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