Help Me!!!!

[jackie27]

My husband and I are working very hard to reduce out debt and I just made a purchase that put us even farther behind. I just traded in my car that I owed $6500 and got a 2007 Acura for $26,000. I am experiencing buyers remorse, I should never have bought this car. What should I do? I have been thinking about putting it up for sale and getting something cheaper, but I am concerned about the fact that I will owe more for the car than I will be able to sell it for. What would you guys do, keep it or try to sell it? Thanks for your help!

[lovcom]

1. It is good that you have come to your senses.
2. Sale the car and recover as much as you can.
3. Get a small 4 cylinder car that sips gas. Get a used one.
4. This situation is indicative of other character problems that you have. There is a reason why you did what you did. Find out what compelled you to buy that Acura even as is causes more damage to your finances. Fix this, and then you can be happy.

You're not alone. MOST Americans have done what you did, and most of them will not wake up to their folly, so in this regard, you are better then them.

Go forth and sin (spend) no more....justify every penny. This is how you can bring stability, sustainability and happiness into your life.

[disneysteve]

My husband and I are working very hard to reduce out debt and I just made a purchase that put us even farther behind.

These statements are contradictory. Clearly, you and your husband are not working very hard to reduce your debt if you went out and spent 26K on a car. What should you do now? Since you bought the car used (good job on that at least) I would immediately put it up for sale. Assuming you did your homework before buying, you should be able to sell it for what you paid. If you clean it up a bit, you might even make a few dollars. Then, take the money and buy a decent used car for no more than $5,000.

What does the rest of your financial picture look like? What do you earn? How much debt do you have? What are your monthly expenses?

[jpg7n16]

I think this is more of you felt overloaded with the pressure you were putting on yourself to reduce debt, that you gave into temptation and did something foolish.

I actually do believe you were working hard at getting out of debt, and for you it was too hard. Thus your old behaviors popped back up. You wanted a better car, and for the 1st time in a while, you just didn't care if it meant debt or not. It's understandable to want a nice car. But you clearly understand now that the car is standing between you and your goal to be debt free.

Sell the car. Buy a cheaper used one. I'd actually suggest you upgrade your car a bit to an 8-12k car. Clearly you had a strong desire for an upgrade to the car - you can get a really good car for around 10k. 26k is too much right now. (I have a Honda Accord I got for 13k and I love it. It's probably worth around 10k now and is a really good car) The pressure of this whole get out of debt thing is a bit much for you right now. Better to take on slightly more debt now, to make you okay with the process of getting completely out of debt, than to go on overkill and end up buying a new car again in 6 months when you can't handle it anymore.

You're human. You're allowed a mistake every now and then Just do what you can to fix this one, and keep from making another one in the near future.

[swanson719]

I completely agree with Disneysteve. Sell the car, get one under $3,500 in my opinion. Being debt free is work. My DW and I got there in February of 2009 and it takes a lot sacrifice to not go out and do things and save. We don't make a ton of money, but we live better than our peers, save more, and invest more because we don't have bills. A $26,000 car can delay retirement by a couple of years for the average family. My father in law is a driving a 99 pickup with 275,000 miles on it. You just need to have the will power to realize that living lean now means living fat later. It's a financial diet.

JPG is right, everyone does slip up. I lost $3,500 at the casino over the course of 3 months earlier this year. One weekend I got lucky and won it all back and then some. I still go play cards about once a month for $100 at a shot as my kind of financial release. My wife buys designer purses a couple of times a year. We have our little things that let us keep on track without busting the budget. I think little things like that would be a better idea than buying a $8K or $10K car.

[jpg7n16]

I still go play cards about once a month for $100 at a shot as my kind of financial release. My wife buys designer purses a couple of times a year. We have our little things that let us keep on track without busting the budget. I think little things like that would be a better idea than buying a $8K or $10K car.

Yes there are other ways of easing the process of getting debt free. Paying as much as possible all the time requires sacrificing some pleasures of life, and for some people that's too hard. I'm glad you guys have a system that works for you.

The nicer car idea - I don't think is too bad (obv since I recommended it ) If a $4k car will last another 4 years, and then gets replaced by another $4k car, and an $8k car lasts say 6-7 years, it's almost a wash in terms of losing value on cars. (the 4k cars lose $1000/yr - the 8k car loses 1140-1330/yr: 8k car loses about $10-20 more a month)

At 7% interest, the extra $3-5k costs $210-350/yr ($17.50-29.17/month)

It's not perfect, but if it satisfies her desire for a better car - and allows her to maintain her spending behaviors on her plan to get debt free, then good.


[The 26k car is terrible by comparison - if it lasts 10 years, it loses $2600/year or 1600/yr (130/month) more than the 4k cars - plus the extra interest on the 22k of 1540/yr @ 7% - another 130/month. When fighting to get out of debt, this decision costs $260 a month more than it needs to.]

[disneysteve]

[The 26k car is terrible by comparison - if it lasts 10 years, it loses $2600/year

I'm certainly not supporting the 26K car but this is faulty math. It assumes that after 10 years, the car has zero value. A car never depreciates to zero. I'm driving a 1998 model currently and it still has a book value of about $2,500 trade-in value and $3,000 or so private sale value.

[maat55]

OP, sell the car(pay the stupid tax). Yes, you will likely loose money, that money was gone when you bought it and the longer you wait, the more you loose.
I would find a bargain car for 3k or less. You have to make getting out of debt your top priority or you will never do it.

Once you have accomplished this, you will have another perspective of your personal finances. You will want to establish an financial plan, one that determines how you spend and save.

How much and will you pay cash for a car or borrow for three years or less?(cash, the least car you need until debtfree, and investing properly)
How much will you save/invest?(consumption items and investments)
How much house should you have?(28% of income or less)
How much emergency fund should you have?(3 to 6 months expenses)

Establishing an debtfree(or limited debt) lifestyle and automatically saving and investing are the two most important aspects of personal finance, once you get to this point, making decisions get easier, you have an guideline for them.

[jackie27]

Thank you for now and hopefully more to come!!!!!

When I asked my question the other day it was my first experience with this website or anything like it. I was feeling pretty confused and I was so surprised when I logged in today to find that people had offered advice. Thank you to everyone who took the time to read it and offer me suggestions. I wanted to add to this also, I am in the process of cleaning up the car and getting it ready to sell. I have about $5,000 in credit card debt, $10,000 in student loans (and this figure will continue to climb as I am pursuing my bachelors degree and I am a junior),and 1st and 2nd mortgages. I work a full time job and also pick up extra work most weekends. A few of you who replied to my post hit the nail on the head; I have spent so much time and hard work pounding away my debt and I slipped into my old ways. I actually bought the car out of spite (long story). I feel like an idiot, but everybody makes mistakes and I appreciate the encouragment.

[maat55]

When I asked my question the other day it was my first experience with this website or anything like it. I was feeling pretty confused and I was so surprised when I logged in today to find that people had offered advice. Thank you to everyone who took the time to read it and offer me suggestions. I wanted to add to this also, I am in the process of cleaning up the car and getting it ready to sell. I have about $5,000 in credit card debt, $10,000 in student loans (and this figure will continue to climb as I am pursuing my bachelors degree and I am a junior),and 1st and 2nd mortgages. I work a full time job and also pick up extra work most weekends. A few of you who replied to my post hit the nail on the head; I have spent so much time and hard work pounding away my debt and I slipped into my old ways. I actually bought the car out of spite (long story). I feel like an idiot, but everybody makes mistakes and I appreciate the encouragment.

This forum is filled with people who have experienced financial hardships and successes. You will get different view points on some issues but generally, many financial issues have simple answers, just difficult actions.

It is refreshing to see those who truly want to better themselves and accept the sacrifices needed to do so. Good luck to ya.

[mom-from-missouri]

You just bought it?? In some states you have a period of time to back out of the sale/contract. If you can, do that.

[cypher1]

Just curious, what type of Acura did you purchase? RL, TL, etc? At least you purchased a vehicle with great reputation/reliable history. Hopefully worst case scenario, take a hit on registration/title/tab fees but get most of your money back depending on how much to negotiate. Best of luck on selling and finding a replacement vehicle.