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Archive for the ‘Cars / Autos’ Category

The Car Sharing Economy Is On The Rise: A Conversation With RelayRides

April 13th, 2013 13 comments

RelayRides Car SharingIt hit me the other day that I’ve been sitting on a goldmine of wealth and knowledge living here in San Francisco, the startup capital of the world. As a 12 year resident of the city with an entrepreneurial bug, a desire to meet more interesting people, and a personal finance blog with a yearly readership in the millions, what a great opportunity to meet up with some of the promising new companies of our generation and bring their stories to all of you. I plan on profiling at least one new startup a quarter in an assortment of industries. I hope you enjoy the new series!

For most people, your car is usually your first or second most valuable asset, and it’s also one of the fastest depreciating assets. Long time readers know that I don’t recommend anybody spend more than 1/10th of their gross income on a car if they want to build financial wealth.

Not only do you have to pay ongoing operating and maintenance costs, you’ve also got insurance costs that could easily total in the thousands of dollars a year. With the average car sitting idle 92% of the time, most folks are flushing money down the toilet with cars they don’t need.

The multiple financial meltdowns over the past 10 years have created a shift in consumer’s attitudes towards ownership. I think consumers are wisening up to the fact that tying up a lot of capital to own a car when good jobs are hard to come by is foolish. Millions of car owners with uncomfortable car payments that last long after the initial euphoria of ownership wears off are wondering how to mitigate costs.

RelayRides is trying to make these economics more favorable for their car owners by allowing them to turn this idle, depreciating asset into a source of income. For car renters who want to preserve their capital, but still want the flexibility of having a car for 20-40% cheaper than renting from a large agency like Avis or Hertz, RelayRides wants to help you as well.

A SITDOWN WITH ANDRE HADDAD, CEO OF RELAYRIDES Read more…

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Supporting Our Veterans Back Home – Sponsored Video

December 29th, 2012 26 comments

Blue Angel In The SkyMy grandfather served in World War II and my father served in Vietnam. I on the other hand, served in no wars, making me itch for ways to give back. I feel a little unworthy as so many brave men and women each year serve to protect us back home. Perhaps bringing to light Veteran issues on this platform can help.

It’s a shocker to discover there are over 130,000 homeless veterans in America today (new reports show the figure is down by 48% since 2008 to roughly 62,000). It’s also a big disappointment to read our troops struggling to find work when they return. When a representative on behalf of Jeep contacted me to sponsor this post as we wait for the resolution of the Fiscal Cliff, I happily obliged in order to continue raising awareness. The original Jeep Bantam BRC became the primary light 4-wheel-drive vehicle of the United States Army and Allies during World War II.

In the Spring of 2012, President Obama proposed the Veterans Jobs Corps Act. The price tag for such help came at an additional $1 billion dollars a year for the already $109 billion VA budget for 2013. Does $1 billion or even $110 billion sound like a lot? It depends, given we spent $1 trillion fighting in Iraq and $3-$4 trillion if we include our fights in Afghanistan and Pakistan.

Suddenly, spending 1/40th the amount we spent on three wars to help our soldiers doesn’t seem like much at all. What the spending ratio tells me is that there is a way for the US government to do more if they choose. Here is some information from WhiteHouse.gov on what they are doing for Veterans.

THE VETERANS JOBS CORPS Read more…

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Desire Is The Cause Of Suffering

December 9th, 2012 33 comments

Porsche Carrera GT

Since I was a kid, my mother taught me that desire is the cause of suffering. Despite her teachings and the teachings of The Dhamapada, I could not root out the desire for nice things once I graduated from college. I bought multiple motorbikes, cars, expensive watches, vacation properties, and nice clothes in my 20′s. I told myself that I deserved nice things since I worked so hard. There was no denying materialism.

Only unti I turned 30 did I really start slowing down my consumption habits. I was starting to tire from working 60-70 hours a week. I knew my spending habits had to change given I didn’t plan to work forever. Things that once excited my spirit no longer captured my interests. Instead, I started to systematically purge everything I owned that wasn’t a necessity.

What I discovered from donating literally 20 bags worth of stuff to the Salvation Army one year is how liberating it felt to have less! The house is much cleaner now and I no longer have to stuff my drawers tightly due to a lack of space. By driving a $5,000 car instead of an $80,000 car, I no longer worry about anybody denting my doors. By not wearing expensive clothes, I can roll around freely. This 2007 white Macbook I’m using sure has traveled a long way. Things are better now. Just don’t put me in front of all those toys I couldn’t afford when I was a kid! I’ll probably end up buying everything.

The man in the picture reminds me that desire is suffering. He’s sitting down, sobbing as he stupidly tried to do a 180 in the middle of a residential intersection at 65 miles per hour. He lost control of his $500,000 Porsche Carrera GT and fishtailed into two parked cars. He told me his car was classified as “non-operable,” meaning his insurance would not cover his damages. “The only pearl white GT in North America is ruined!” he whimpered.

My life has been going so bad these past few years. I can’t catch a break,” the owner continued to say. When you have enough money to own a car worth half a million dollars, how horrible can life be? Very bad I guess. I felt sorry for him and told him at least he didn’t injure anybody. He thanked me for the encouragement and began to cry some more.

Money doesn’t buy happiness, but you know that already. This picture is just a reminder not to let money take over your life. Now if only we knew where the passenger with his three year old kid on his lap went. They ran away before the cops arrived.

Recommendation:

Save On Auto Insurance: Auto insurance is the biggest expense of owning your car followed by regular maintenance. For a free, no obligation competitive auto insurance quote that searches the best insurance rates by StateFarm, Nationwide, and AllState CLICK HERE. It is very important that everyone gets at least basic liability car insurance. You can total your car and be fine. But if you total someone else’s car and injure them, they can go after you for ALL your assets and wipe you out!

Regards,

Sam

 

Categories: Cars / Autos Tags:

Should I Get Roadside Assistance Coverage Insurance? Hell Yeah!

November 23rd, 2012 20 comments

1989 BMW 335i CoupeEvery winter, I make the 180 mile trek from San Francisco to Squaw Valley, Lake Tahoe to enjoy the epic snow. There is truly nothing more magical than spending hours riding on powder and having a beer or two in the outdoor hot tub when you’re finished! Oh, the stories I could tell you about what happens in the hot tub.

On the other hand, there’s nothing more frustrating than getting a flat tire at night in the mountains while it’s snowing. I know how to change a tire, but I sure as hell don’t plan to risk my life changing a tire in darkness on a one lane road in the mountains while cars zoom by. I might get a nice settlement if I do get into an accident. But, I also might lose a leg in the process!

Every month, I spend 98 cents to get roadside assistance insurance for Moose. Add up the cost over 84 months of ownership, and we’re talking $83 worth of premiums. And you know what? My roadside assistance insurance is worth every penny! I already mentioned how my alternator died just as I was pulling into my garage thank goodness. A tow truck came when I got back from vacation to follow me to my mechanic thanks to roadside assistance. What I haven’t told you about are my other more traumatic incidences!

IT WAS A DARK AND STORMY NIGHT Read more…

Categories: Cars / Autos, Insurance Tags:

Never Go To The Car Dealer For Service

November 18th, 2012 31 comments

Red Battery Light Warning SymbolThe other day, Moose’s battery light went on. Unlike the three other yellow error lights on the dashboard, the battery light was ominous red. Thinking it was no big deal, I decided to leave the light unattended for a couple days. After all, I just spent $85 on a new Diehard battery 6 months ago!

As I pulled into my garage, Moose suddenly lost power. The entire dashboard went out and pressing the gas pedal revved no engine. Oh no! Moose, don’t die on me old buddy!

Thankfully I was in my garage when the power went out. Otherwise, I would probably be stuck in the middle of the street somewhere. I called USAA roadside assistance for a jump. I cannot tell you how worth it getting any kind of roadside assistance is. For around $5 bucks a month, I get free jumpstarts and tows to anywhere! I’ve had to use them 5-6 times in the past 10 years, and each time was a life saver.

Roadside assistance came about 45 minutes later and Moose was back in business. I read the manual to review what happened, and it wrote, “If battery light goes on, see dealer service immediately!” OK, I guess I shouldn’t have been so nonchalant, but I couldn’t go see my mechanic since they were closed on the weekends. My flight to Hawaii was the next day and I wouldn’t be back for a week.

Another Close Call Read more…

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The 1/10th Rule For Car Buying Everyone Must Follow

October 6th, 2012 175 comments

Old Car In EstoniaAfter introducing the 1/10th rule for car buying in 2009, some people changed the way they went about purchasing a car. Meanwhile, many more complained my rule was too onerous for the typical income earner.

I watched in horror as a total of 690,000 new vehicles averaging $24,000 each were sold under the Cash For Clunkers program in 2009. The government’s $4,000 rebate for trading in your car ended up hurting hundred of thousands of people’s finances instead! Your $20,000 invested in 2009 would now be worth $40,000.

Buying too much car is one of the easiest and biggest financial mistakes someone can make. Besides the purchase price of a car, you’ve got to also pay car insurance, maintenance, parking tickets, and traffic tickets. When you add everything up, I’m pretty sure you’ll be shocked at how much it really costs to own a car and barf!

The 1/10th rule for car buying is simple. Spend no more than 1/10th your gross annual income on the purchase price of a car. If you make the median per capita income of ~$42,000 a year, limit your vehicle purchase price to $4,200 if you must buy one. Absolutely do not go and spend the median car price of $24,000!

A median income earner buying the median priced car is financially absurd. Who spends 60% of their gross salary on the purchase price of a car? Worse yet, who spends 75% of their net income after 20% taxes on a car?

WHY YOU SHOULDN’T SPEND MORE THAN 10% OF GROSS ON A CAR Read more…

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Auto Insurance Basics And Recommendations For Everyone

September 21st, 2012 38 comments
Car wreck

Why you need auto insurance!

Besides the purchase price of a car, one must also calculate the potential maintenance cost, and auto insurance cost. We often focus on the first two costs, but seldom do we realize the auto insurance cost differential until we’ve purchased the car!

I was so happy to negotiate $2,000 off the initial asking price of a $14,000, black on black, BBS wheels equipped 1997 M3 in 2003 that I didn’t realize my auto insurance would jump from just $500 a year to $2,000 a year!

Had I realized my auto insurance would jump so much, I probably would have negotiated even harder, or reconsidered buying a sports car altogether. Always get an auto insurance quote before you purchase a car please!

Having auto insurance is a law you don’t want to break. Accidents happen all the time whether they are your fault or not. If you end up wrecking someone else’s car and injuring a passenger, not having any car insurance could literally wipe you out financially and put you in poverty for the rest of your life!

AUTO INSURANCE BASICS Read more…

Categories: Cars / Autos, Insurance Tags:

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