Table Of Contents
- 1 Most “regular” millionaires don’t drive supercars like Ferraris, Porches, Tesla and other performance cars.
- 2 Why?
- 3 End up with more cash to invest
Most “regular” millionaires don’t drive supercars like Ferraris, Porches, Tesla and other performance cars.
What they do drive are
- regular cars like Volvo, Toyota and Buick
- 4- or 5-year old used but reliable cars
The real question back is…why not?
Firstly, when you buy a new car, the value of the car depreciates 10-20% every year.
That could mean that by year 4, your car can be worth only 20% of what you paid for it the first time (80% capital loss or depreciation). So buying a car that is 4- or 5-year old, that could mean a 60-80%+ discount. Of course the used car needs to be reliable.
So instead of paying $100K for a brand new car, you may end up paying $20K for a 5-year old version of the same car.
Secondly, buying a reliable used car that is 80% discounted means that you can pay it off one-off or take a much smaller vehicle loan.
This means that you either pay zero or very minimal in car interest loan which translates to another layer of cost savings, like a powerful well-time 1-2 from a trained boxer.
Where does this lead you?
End up with more cash to invest
If you save up to 80% on the car price as well as interest on the loan, this allows you to invest more into investments that can appreciate in value as well as pay you a monthly or quarterly income. It’s a positive growth loop.
Conversely, the person who pays in full for a new car, takes a bigger car loan, and repeats it every 5 or so years – how much dividends and capital gains they can miss out? A LOT. This is exactly why
- some get richer and the rich get richer* vs
- middle class/poor get poorer
Simply by the consistent actions and decisions they make. Look, I dont want that to happen to you. I want you to be the one that can invest more and more into assets that make more money for you like the scenario in the asterisk*.
I’m the founder and writer here at NigelChua.com; as well as serial entrepreneur, therapy business entrepreneur, digital entrepreneur, investor and also happy husband, father and Christian.
Started and sold off a business for 7-figures; built another 7-figure one and growing it further, plus building/investing into other businesses and investments as well as advisory works.
Nowadays I share and teach entrepreneurship, financial independence, retiring early as well as building and living a life you love.
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