Canadians 'drowning in debt': 47% will borrow to cover costs, survey says

[shermanator]

I didn't choose DINK life, DINK life chose me.

[gasman]

Originally Posted by btimbit

Can they afford it though? If so I don't see the problem. I trade in and get a brand new fully loaded diesel truck about every 11-14 months, and they make me money, but I still get judged over it with people scoffing at the idea

Are you trading in or are you selling privately. Reason I ask, I have a low mileage 2016 SD Diesel that I am looking to get out of and back into a gasser.

"blackbook" has my trade in value around 47k - I paid roughly 65 I think, in October of 2016.

A new Gasser will run at least $70k I think.

[flamesfever]

Originally Posted by I-Hate-Hulse

I find cars are the single biggest wealth killer amongst my friend group. So many subscribe to the "you are what you drive" theory.

For example - single income family living on his professional 6 figure salary. They have 2 toddler kids and are looking to upsize to a 3 row SUV from a 5 yr old 2 row. They could muddle through with the current vehicle, but are looking at a $60K 3 row. Frankly a $40K new minivan (let alone a used) would address their needs but its not even being considered as they "just can't do it" from an image point of view.

Then there's the flippers. Lease a new car every 3-4 years, not realizing you are paying through the nose eating the depreciation on these high end German cars. But they do this to be able to afford the latest and greatest that supports their image.

To fund all of this of course, means living in the far burbs so that they can get their 2,500sq ft house (complete with the latest Jillian Harris approved designer kitchen with quartz countertops). Which means their yearly km's driven approaches 15-20k km a year meaning they need new cars more often.

It's a vicious cycle with cars and wealth.

While growing up in Toronto n the 50s, I used my high school math to show that if I took the average salary of a family at the time, and assumed an annual profit of 10%, I would never be able to accumulate any wealth if I purchased a new car every 3 years.

I never drove a new car until I turned 65. When I finally did, I made the salesman drive around the block with me, as I realized I just lost $5,000.

[peter12]

Originally Posted by flamesfever

While growing up in Toronto n the 50s, I used my high school math to show that if I took the average salary of a family at the time, and assumed an annual profit of 10%, I would never be able to accumulate any wealth if I purchased a new car every 3 years.

I never drove a new car until I turned 65. When I finally did, I made the salesman drive around the block with me, as I realized I just lost $5,000.

I bought one new car when I was 25, and it was the worst financial decision - besides marriage - that I ever made.

[I-Hate-Hulse]

Originally Posted by btimbit

Can they afford it though? If so I don't see the problem. I trade in and get a brand new fully loaded diesel truck about every 11-14 months, and they make me money, but I still get judged over it with people scoffing at the idea

Define "afford it".

If it's about finding a way to squeeze a monthly car payment of X into monthly income of Y, then yes.

If it's about whether spending $40K for vehicle expense (and having no monthly payments after 4 years when the vehicle is paid for) for the next 10 years or spending $75K then no.

If he loses his job they have a month before they have to start selling RRSP's to survive.

Given this, can they afford it? Technically yes, but the big picture answer is no.

[DoubleF]

Originally Posted by peter12

The "butts need to be in seats" mentality is probably one of the most pervasively conservative business mentalities still around. Absolutely blows my mind that professional workers whose output is by definition creative are required to be around for 5 days and 40 hours a week.

You'd be surprised how some people flip their lid when you're not available during business hours. I guess we trained our clients well, because we brought in a batch of new clients and it was stuff like, "How dare you go and take a piss the moment you call or eat lunch during a period called lunch! You're making it inconvenient for me and the customer is always right!". It's absolutely ridiculous and we started calling these people out and telling them they're free to go elsewhere if they don't like it.

And no, I guess my company is old school. Unless there's some dire circumstances, work stays at work. I'm not dragging that stuff home/vacation and essentially being on call all the time. I get that plenty of people like the work from home set up, but for me personally, I like the clear boundaries.

I get that not everyone has to deal with clients or someone and be around at specific time periods though. The 5 days 40 hours availability thing is outdated, sure. But that's heaven compared to some of the stuff you run into in Asia.

Originally Posted by Wormius

I don't know why people even upgrade to a larger vehicle because of kids. Unless they're giants, kids and their seats will fit in almost any 5 seater vehicle. Both of our kids were in our little Impreza from after they were born through to growing out of the car seats. It's weird that there is this misconception that small children won't fit where adults would normally be expected to fit.

Is it just me, or has the personal bubble thing gotten really extreme over the last decade? People freak out if you're too close to the front of the line, people constantly say they need their own personal space at home, in the car etc. I wonder if it's part of the fueling of the bigger homes and vehicle situation?

Who else remembers sitting like a sardine in a vehicle? Who remembers the screams of, "X touched me! Tell him to stop!" (not necessarily you). I mean, the last frontier for the personal bubble struggle is the armrest fight on flights, right?

I mean, socializing has also been badly handicapped to the point most people suck at doing it. This bubble thing to me also seems like an extension of that.

[indes]

I just had to buy a second truck for work, bought one for 1/4 of the price of my other truck. I like the cheaper one better and can't believe I dropped 80k on a new truck to go upside down for no reason.

Second dumbest thing I've done...after marriage.

[btimbit]

Originally Posted by I-Hate-Hulse

Define "afford it".

If it's about finding a way to squeeze a monthly car payment of X into monthly income of Y, then yes.

If it's about whether spending $40K for vehicle expense for the next 10 years or spending $75K (and having no monthly payments after 4 years when the vehicle is paid for) then no.

If he loses his job they have a month before they have to start selling RRSP's to survive. Given this, can they afford it? Technically yes, but the big picture answer is no.

I'd say my definition would simply be could they make the purchase without potentially hurting themselves financially. So I definitely agree with your answer of no in this case.

[chemgear]

Originally Posted by peter12

I bought one new car when I was 25, and it was the worst financial decision - besides marriage - that I ever made.

"If it floats, ####s or flies - you only rent it. Never buy it."

[Looch City]

wtf is a DINK??

[btimbit]

Originally Posted by Iggy City

wtf is a DINK??

Tinder taught me this one!

It means "Dual Income, No Kids"

[chemgear]

Originally Posted by btimbit

Tinder taught me this one!

It means "Dual Income, No Kids"

[blankall]

Originally Posted by peter12

This person exists everywhere and they are the lowest of scum. If you have a manager who likes this kind of thing, I can't think of a surer sign you need to leave your job and move somewhere better.

Unfortunately, society generally, selects for these type of people. Managers will always give preference to anyone who strokes their ego, and some people just have a talent for this.

The only way to avoid this scenario is to be self-employed.

[blankall]

I had a very good experience buying my car new. I bought a 2010 Toyota Matrix, and leased it for $350/month (after taxes). I was able to write-off the lease payment. The car was very solid, and then I bought out the lease at the end of term (4 years) and kept it. I paid off the remainder in about 3 years, and since then have had car which I drive for free.

Where people run into trouble is with buying higher end cars new. For example, a new Porsche Macan will cost $80-90k new, but be worth $40-50k 2-3 years later. That being said, maybe you don't need the Porsche in the first place.

I do, however, think that there are benefits to buying lower end cars new, especially if you can write off lease payments. The ability to know you are getting a car without major issues justifies much of the price. Plus technology changes so fast on those cars, that you do get a lot more vehicle buying new.

[Raekwon]

Originally Posted by nik-

It seems like the root of a lot of these problems is children.

Just stop having them.

Your math doesn't add up, the more kids I have the more money I get from the government.

[DoubleF]

Originally Posted by I-Hate-Hulse

I find cars are the single biggest wealth killer amongst my friend group. So many subscribe to the "you are what you drive" theory.

For example - single income family living on his professional 6 figure salary. They have 2 toddler kids and are looking to upsize to a 3 row SUV from a 5 yr old 2 row. They could muddle through with the current vehicle, but are looking at a $60K 3 row. Frankly a $40K new minivan (let alone a used) would address their needs but its not even being considered as they "just can't do it" from an image point of view.

Then there's the flippers. Lease a new car every 3-4 years, not realizing you are paying through the nose eating the depreciation on these high end German cars. But they do this to be able to afford the latest and greatest that supports their image.

To fund all of this of course, means living in the far burbs so that they can get their 2,500sq ft house (complete with the latest Jillian Harris approved designer kitchen with quartz countertops). Which means their yearly km's driven approaches 15-20k km a year meaning they need new cars more often.

It's a vicious cycle with cars and wealth.

Conspicuous consumption?

I mean, the issue isn't buying nice things. The way I've been explaining it to friends is that there's no point in spending money on non-essential things that you don't even like, especially if it's going to be a financial burden.

That Van vs SUV perception thing is so stupid though. The practicality of a van is amazing and they're pretty sprightly vehicles. I loved driving the family van more than the sedan. Sliding doors and young children tough... excellent. My wife struggled with the image of a minivan at first, but when her friends revealed they were green with envy of how easy and practical it was, she began to appreciate it more.

I used to be super against leasing vehicles, but I see the allure of doing so now. The main reason I would lease over finance is that the minor difference of around $500 per year is a good insurance if something destroys that thing before the lease term comes up and it'll bother you even if it's repaired (ie: massive hail damage). I still like the idea of buying a 3-4 year old vehicle, but with the little one in tow and time at an absolute premium, it's nice to nab a vehicle that in theory should not have a single major repair for at least 3-5 years (or at least it's all covered under warranty).

[Fuzz]

Meh, most of automotive tech is garbage anyway. Oh good, they replaced my buttons with a touch screen. Thanks. What's that? This lane departure camera means a $300 windshield now costs $1200? Thanks, that works wonders around here.

[chemgear]

Originally Posted by Raekwon

Your math doesn't add up, the more kids I have the more money I get from the government.

You disgusting carbon polluter. Way to destroy the planet.

[Table 5]

Originally Posted by Fuzz

Meh, most of automotive tech is garbage anyway. Oh good, they replaced my buttons with a touch screen. Thanks. What's that? This lane departure camera means a $300 windshield now costs $1200? Thanks, that works wonders around here.

Get ready for mirrors to be replaced with high tech screens next. Instead of a basic, relatively cheap, pieces of glass that work in all situations, now you'll have two more screens by your a-pillar.

Progress.

[Fuzz]

Originally Posted by Table 5

Get ready for mirrors to be replaced with high tech screens next. Instead of a basic, relatively cheap, pieces of glass that work in all situations, now you'll have two more screens by your a-pillar.

Progress.

I'm sure they'll work great covered in road grime.