Ok on the surface it’s a pretty sweet deal. The “cash for clunkers” program is probably going to help our globally overheated, ozone depleted, melting little planet by getting those evil gas-guzzling beasts off the road. (Sense just a tad bit of cynicism?)
It might give the auto industry a little boost, and will probably help the used auto parts industry. That’s all cool. That means more jobs, maybe a little more spending etc.
The program may have some benefits.
But there’s a downside and we’re already seeing it with some of our clients. Yes you know who you are – and you knew this lecture was coming 
In general when we really want something, we tend to put blinders on. We see what we want to see, and we always figure out a reason why it makes sense to buy it.
Yep, Cash for Clunkers is the perfect excuse for some of you.
What better time than now to finally get a new car right?
Uncle Sam is one hell of a guy and he’s going to make the down payment for us. Ok that’s super cool – Sam you’re the man! But he’s not making your monthly payment.
Do I need to remind everybody what happened with the housing market? If we had a pulse and could drool on a contract, lenders had the perfect adjustable rate mortgage for us.
We had no clue how we were going to make the payments, but who cares – we’re getting a new crib.
We are seeing a lot of our very own credit repair and debt settlement clients trade in cars that were working just fine, for new cars when you know you can’t afford the payments.
I get it, I promise I do. If I needed a new car, I’d probably be taking advantage of this program too.
But I can assure you, I’d be looking past the 4500.00 Uncle Sam is forking out, and I’d be focusing on the payments I’m obligated to for the next 5 years.
If you are absolutely sure you can afford a couple hundred more each month for the next 5 years, maybe it’s a great time.
If you’re sure you’re job is not the next to start letting employees go- than maybe it’s a great time.
If you’re credit cards are paid off – than maybe it’s a great time.
Am I starting to sound like Jeff Foxworthy?
But if you find yourself figuring out a way to buy a new car, than it’s probably not the right time. Do the right thing. There will be a better time later on – I promise.
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Nice share and I love your quote “In general when we really want something, we tend to put blinders on. We see what we want to see, and we always figure out a reason why it makes sense to buy it.”
People mostly do that!!
That’s the beginning of financial problems.
You make a very good point. People in today’s society are natural spenders who want the latest toy on the market. So when they see incentive to purchase something, they may overlook the actual practicality of the purchase. Sure you might be getting a $4500 rebate for the old car, but you are also committing to years of payments. Take the time to think of whether you really need a new car or if it is an unnecessary luxury.
Great post! Yes, what Americans don’t need is another excuse to spend money!