Roll cash cars to your dream car

We know that car loans are a bad idea. If you aren’t convinced, take a look at my last post on the topic. But you probably don’t want to drive an unreliable junker for the rest of your life, right? So how do we handle that?

You roll from cash car to cash car, all the way to your dream car.

When I say roll, I don’t literally mean push a car. Yes, it has wheels, but this is a different sort of roll. In this case, I mean trading up in car over and over when it makes financial sense.

You know from my last post that the average car loan is almost $600. Why pay that to a bank when you can pay it to yourself?

The concept here is simple, but the execution is hard. It’s easy to be tempted by a loan, but don’t do it! A little sacrifice up front, and a little common sense, and you’ll be in a much better spot long term. So what’s the plan?

You want cheap, and you want reliable. Think Honda, Toyota, Hyundai, Kia, brands like this. They have great reliability reputations, especially over the last 10 years, and they aren’t incredibly expensive. The last thing you want to do when you’re rolling cash cars is to buy a “cheap” 20 year old BMW. The German brands are flashy, and people find them desirable when they’re new, but as an older used car, you’re better off avoiding them. The repairs are expensive, and that defeats the purpose here.

If you’re starting from nothing, start with something relatively cheap, $1,000 or $2,000 will be fine, we won’t be here long. At this price you really want something reliable, so spend a little extra and have a mechanic look it over before purchasing. Then pay cash.

Over the next year, each month, instead of sending a car payment to a bank, put it in a savings account. Don’t spend it. Save it.

If you do half the national average car payment and put away $300 each month, in 12 months you’ll have saved an additional $3,600. Now you can sell that $2,000 car you bought, and because you only had it for a year, you can probably get $1,800 for it. $1,800 + $3,600 gives you $5,400 to buy a car with. In cash.

Rinse and repeat. Maybe you keep a car for a year, maybe it’s a couple years. The specifics are up to you, but this is how you can have a nice car, without a car loan. Pay the loan to yourself.

This will be hard. Your friends may make fun of you. You may hate the car. It may not have all the technology and creature comforts you want. But you know what else you won’t have? A car loan, and the payment that goes with it.

Can I give you something?

If your budget needs work, I have something for you. It’s my completely free Master Your Budget Categories guide, with over 270+ categories laid out and organized specifically to help you budget better. I’ll even show you exactly what goes on my budget.

Think of it as the foundation to your perfect budget. Can I send you my categories?

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