Lately, I’ve had new truck fever. Maybe it’s because I have a beard and sometimes wear flannel… although last weekend my brother warned me of the “Lumbersexual” phenomenon sweeping the country so maybe the fever is due to a broader epidemic.
Regardless of the cause, in the last 4-6 months, four of my friends have bought new trucks: two Ford F150’s, a Toyota Tundra, and a Chevrolet 1500. Man, they’re all sweet trucks. They’re big and powerful enough to pull the space shuttle or to carry a new bedroom set from Ikea (the more likely scenario for truck owners). They’re rough, rugged and very sharp.
Halfway through my deciding which one I would want to buy, I started looking at prices. HOLY CRAP, have you seen the price of new trucks lately?!? The cost of a new F150 Platinum edition is roughly equivalent to the entire Gross Domestic Product of Nicaragua! Seriously, when did trucks get so expensive?!
If you’ve followed this blog for a while, you know this only adds to my rants against new cars. It all started because I bought a brand new Nissan Xterra one year out of college that nearly sunk me and it’s continued since then when I’ve purchased all my new(er) cars for cash.
Seriously people, new trucks now cost somewhere between $45k – $60k! I’m sure it’s easy to go above that, but I can’t even bring myself to type it on the screen. This is an absurd amount and hopefully my friends who read my blog will skip this post – seriously though, don’t take it personal, I make people angry all of the time by my poor writing. Also, I know that most of them can afford it (based on the 20% rule) and that a couple of them even paid cash (nice work!!).
So how are so many Americans affording these super-expensive trucks? Some might actually be able to afford them, but according to Experian, the majority of them are taking out RIDICULOUS 6-7 years loans:
The percentage of loans with terms of between 73 and 84 months also reached a new high of 29.5% in the first quarter of 2015, up from 24.9% a year earlier
You might tell me it’s a smart use of money because it’s such a low interest rate, but I’ll tell you I think that’s complete BS. Why? Because people buy things based on how much of a monthly payment they can afford, not on total cost. This means too many people will take out a loan on something they can’t afford just to do the same in three years when they get car fever again, but this time they have to roll over the amount they still owe on their car into their new car loan. It traps people in debt and it’s only getting worse.
Buy cars for cash and you skip any issues of buying more than you can afford.
One of my friends is appealing to my practical side and recommending a Honda Ridgeline, but I don’t think that’d earn me the Lumbersexual card. I’ll keep my high-mileage, paid for cars and continue to build up the war chest for next moves.