Comment by Jcampuzano2 | Hacker News Reader

Comment by Jcampuzano2 | Hacker News Reader

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If you're using credit to buy a car, most people do so in order to get to and from their place of work for the majority of their driving time. In that way, using credit to buy a car still fits into their theoretical model. For example I know plenty of people who completely got rid of their cars when remote work became more common, or at the very least consolidated to smaller cars or to less cars for a family.

Similar thinking for a house. A lot of people when buying a house go into it with the assumption that it is an appreciating asset that will gain value over time. Yes there are other factors of course like wanting to live closer to schools or in the suburbs/good areas, etc. But regardless this is commonly to facilitate a life that lends itself to you continuing to be able to make money comfortably.

Regarding vacations, no financial expert recommends using a card without the intention of not paying for it. If your plan is to book the vacation on credit for anything other than the benefits of your credit card points systems you might as well not use it at all. And all recommend not using credit cards and instead an emergency fund if you lose your job.

No. You can rent and you can take the bus. Or rent and buy a crazy cheap old used car.

A house and a decent car are not primarily about making money. They're about your quality of life.

> And all recommend not using credit cards and instead an emergency fund if you lose your job.

And if you already used your emergency fund on, say, a medical emergency...?

Yes because American public transit is so great and now you have to get up hours earlier and come home later - not great if you have kids or you actually want to spend time with your significant other.

Also what happens when that cheap old car doesn’t start in the morning when you need to get to work or pick your kids up from day care/school or need to be home when they get off the bus?

Where are you going to get the money to fix that old car?

You present some very daunting problems that the young and working class have to deal with (I know, I was both of those decades ago and struggled myself).

Credit to buy a new car though is still generally a bad solution. We should fix the other things you mentioned.

I would like to see laws allowing extreme low-cost vehicles (equivalent to golf carts, I guess) allowed on designated roads. A special inexpensive insurance proviso for them.

That you need something like $30K to buy a new car in the U.S. is insane.

How are you going to safely have a golf cart on a highway? And what good is a car that can’t get you everywhere you need to go?

To go between work and my apartment, I didn't need the highway. As I have said in another thread, I made do with a 10-speed bicycle, frcrisake. I don't expect everyone else to be able to do that though.

> I would like to see laws allowing extreme low-cost vehicles (equivalent to golf carts, I guess) allowed on designated roads. A special inexpensive insurance proviso for them.

These already exist! You maybe haven't heard about them because they're largely a failure beyond niche applications. They're mostly used for things like hospitality shuttles, facility maintenance, meter maids, etc.

https://en.wikipedia.org/wiki/Low-speed_vehicle

https://en.wikipedia.org/wiki/Neighborhood_electric_vehicle

The problem is that they don't make sense for most people, e.g:

1. You can't operate them on high speed roads. The US has a lot of high speed roads, particularly in areas that are poorer.

2. They aren't cheaper than a used car. A street legal Cushman or GEM starts at about $16k. A brand new Nissan Versa is only about $1-2k more, is wildly better equipped, and has more accessible financing. Good $10k used cars are available on every street corner in every poor neighborhood with extremely accessible financing.

3. They are weird. It is much more socially acceptable to drive a similarly priced used car.

4. They lack features that used cars have. Many control cost by omitting basic features such as doors and climate control.

5. The places where you can use them (low speed neighborhood roads) are already more likely to be accessible by alternative means of transportation. (busses, bikes, walking)

> A street legal Cushman or GEM starts at about $16k

I see a business opportunity.

Where? 'cause I'm not seeing it.

I'm guessing you're taking issue with the price? Meh, that's just what it costs to make a decent product. You can (or at least used to be able to) get hot garbage manufactured abroad for less, but it doesn't meet the standards of what anyone would reasonably get, and they don't compare favorably to even a bad used car.

You might find this interesting:

https://www.youtube.com/watch?v=yRG0Wai4sR0

I remember when you could get a $10k new car... but if you adjust for inflation, we still have those cars today (now they're $20k), and they're actually better than the $10k cars back then.

Lol what bus?

My daughter went a year to and from work by bus in Omaha. Yeah, it sucked. But we should instead be trying to fix that rather than just tell people "Let them eat credit."

Fixing takes time. I need to get to work today or else I'm fired and homeless in a few weeks.

8 years ago I bought a house. My monthly rent was 1300 and mortgage/escrow/repair savings were instead 2000. Rent went up $100-$200 a year.

My son is looking for rentals in our same community and the equivalent rental to what I had is now around $3000.

Even ignoring appreciation, in the long term there was a cash flow savings.

> there was a cash flow savings

... in your case. There was a cash flow savings in your case.

I've moved several times and done the math each time. Sometime it's been more cost effective to own, sometimes to rent. There are a lot of factors that go into that calculation, and the math doesn't always fall on the side of buying. That's especially true if you don't expect to be in a house for decades.

> My son is looking for rentals in our same community and the equivalent rental to what I had is now around $3000.

Good for you. Bad for your son or anyone living in your community.

Agree. I wonder though if the tone of your comment doesn't come across as casting blame on the person who got the mortgage years ago.

It's not intended to, although it is intended to be blunt.

Yep, I have never taken a loan out to buy a vehicle — even though I have always needed one to make money.

When I was working a pizza place, going to JuCo, I had a 10-speed bike for transportation. (Yeah, even in the shit Kansas winters, I was riding to JuCo along the just-plowed roads. Now get off my lawn!)

The odds of two emergencies are low enough that you can ignore this. Not that it doesn't happen, but it isn't that common. If you expect two emergencies you should have more in the fund to cover it.

> If you expect two emergencies

Emergencies are unexpected.

And a lot of people simply don't have the money to build up that kind of fund. To suggest that they "should" is to be pretty out-of-touch with the realities of a lot of people. Sometimes they need to rely on credit, because there aren't any alternatives. So that credit becomes a lifeline, a good thing.

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