CommenTerry, February 6th, 2007
I have never owned a new car and probably never will. As I've mentioned in other posts, I believe a new car is generally a wasteful purchase because of the upfront depreciation. I believe it's more prudent to purchase a low-mileage automobile that is about two or three years old. That way, you are still likely to be getting a quality car -- only someone else has absorbed the bulk of the depreciation.
But even without the depreciation concerns, I would still be hesitant to purchase a new car. That's because I believe I would worry myself to death about someone scratching it or otherwise messing it up in such a way that my new car would no longer seem new. I would be afraid that I would soon have little to show for my expensive purchase, i.e., a significant amount of my savings would be gone or I would be stuck with a large car payment, practically for naught.
Because of this constant worrying, I would never be able to enjoy my new car or experience that feeling of excitement about having one. In addition, I would not be able to turn around immediately and buy another new car, in case my worries became a reality. Also keep in mind that my purchase of the new car, which might get ruined, would prevent me from purchasing other things that I wanted just as bad and would limit the amount of money I could put away for a rainy day. This is called opportunity costs, and it too would be a cause for my concern.
But what, in the above example, would actually be the root cause of my worries? It would be my lack a having unlimited financial resources. I believe this is the root cause of just about everyone's money worries. If money were unlimited for me, I would have no reason to hesitate to buy a new car. If it got damaged in any way that was not covered by insurance, I could always go out and buy another one with no problem. In addition, my purchase of a new car would never create any opportunity costs. I could still buy anything else that I wanted as well -- and there would never be any need to put money away for a rainy day.
That's why I believe that the lack of unlimited financial resources is the root cause of most money worries. Unfortunately, most of us don't have unlimited amounts of money. Therefore, we will always have money worries.
