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Speaker 1: Welcome to another edition of the Chicks on the Right podcast.

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We're talking to Zach Abraham from Bulwar Capital Management, our

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financial guru and sponsor of the show. All Right, today,

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we're talking about cars, Zach, So, first off, the twenty

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thousand dollars car has effectively died, like it's gone, It's

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disappeared from the market. The average price of a new

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car in the United States has officially crossed fifty grand

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for the first time ever. A new car prices rose

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two point one percent from August and three point six

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percent year of a year, which is the steepest jump

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in two years. And I think that's probably driven by

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tariffs and price your evs and luxury models dominating the

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market and whatnot. But you are the financial guru, right

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and is it safe to say that cars are legit

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the financial bane of our existence? Because they are for me,

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at least for me, because I want to get your

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take on like stuff like buying versus leasing and should

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be people by new or used. I know what I do,

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but I'm just curious as a financial advisor, what do

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you think of all this? And cars? How much do

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they suck? Now on.

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Speaker 2: It's horrible?

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Speaker 3: While you were talking about this, though, I couldn't help

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but to think back to my family.

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Speaker 2: I remember.

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Speaker 3: They wanted to My dad really wanted a Toyota land Cruiser,

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and I remember we had a Toyota land Cruiser in

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nineteen Yeah, they were awesome in nineteen ninety four. But

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the reason we waited a good year year and a

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half or so because to spend over thirty thousand dollars

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on a car was, to quote my father, unconscionable, right,

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And I think he ended.

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Speaker 2: Up spending like thirty two grand. That was insane.

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Speaker 3: You know.

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Speaker 2: Now a suburban's one hundred, right, are you yea more?

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Speaker 1: It's like an escalade like escalades and then like you

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look at what's that? The g wagon? Oh yeah, my

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daughter will be like, did you see that g wagon?

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I'm like, yeah, they're like one hundred and thirty thousand,

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ridiculous or.

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Speaker 3: Higher depending on how they're outfitted. I mean you can

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get them as high as three hundred grand.

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Speaker 2: Inane. Like that's insane, it really is.

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Speaker 3: And it makes me cringe because look, if you have

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enough money to where you can go out and pay

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cash for a car like that, and you don't notice

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the cash being gone, meaning it makes no discernible difference.

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That's one thing, right, you know, whatever, that's that's totally

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we're not.

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Speaker 1: Talking about those people. We're talking about like your regular

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person that's saving for retirement. And like I mean, if

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somebody comes to you and they say, Okay, I've got

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to pay for my kids college, I got to pay

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for retirement, I got to pay for my bills every

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single Like, would you say leasing is a good idea?

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Financing is a good idea? Would you say used? Would

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you say new? What would your recommendation be for people

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five years old?

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Speaker 3: Japanese made used cars, right, really used, one hundred percent used?

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Get it with sixty to eighty six tee to one

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hundred thousand miles on it. Look, I should probably spend

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some time developing a ratio for this, but I would

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say that anybody that does not make four hundred thousand

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dollars or above, you probably should never have more than

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fifty percent of your annual salary sitting in your garage

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right right, And that's probably not.

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Speaker 2: The right ratio, but I do know that that would

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be a good rule of thumb.

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Speaker 3: And you see why they do it, right, Like, you

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know you're driving around this brand new car or whatever,

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and you got this eight hundred dollars to one thousand

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dollars payment on it, and you're looking at going. You

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would get the exact same experience had you bought that

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same car five years old with fifty thousand miles on it,

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and you would have saved fifty percent. Right. And the

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reason you don't is to impress people that you don't

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really like and that have I have absolutely nothing to

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do with your financial well being.

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Speaker 1: Right right, and I don't really like you. So what

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do you care?

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Speaker 2: Right? Well, they don't like you. Here's the other thing.

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Speaker 3: A younger you know, well, you got to spend money

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to make money, right, You got to You got to

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look successful before you are successful. Okay, I built a

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firm driving a two thousand and one Ford Focused four

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door Hatchback with one hundred and eight two hundred thousand

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miles on it. It's nonsense. You don't need to spend money.

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Speaker 2: To make money.

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Speaker 1: Like Sam Walton. Didn't he have a pickup truck?

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Speaker 2: Yeah he did.

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Speaker 1: It was a gajillionaire.

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Speaker 2: Yeah. Here's the other thing I'll tell people too.

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Speaker 3: They're if I'm talking, if I'm looking at entrepreneurs or

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I'm looking at you know, people starting a company or

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whatever the case may be. And let's say they're looking

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for investment, and if I see them driving really expensive cars,

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it concerns me. And not because not for moral reasons

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every but it concerns me as far as where is

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their attention, right, what are.

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Speaker 2: They focused on?

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Speaker 3: Because when you're really focused on being successful or winning

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or being driven, right, a lot of that other stuff

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just gets in your way. Right, It's like this unneeded detail.

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And you know, when I sit there look at the

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guy who's got the decked out car, and it looks

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like he's coordinated his clothes with his car colors and

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his watch on the you know, I sit there and

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I think there's a guy that has either way too

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much time on his hands, right, or his really lost

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focus of what's important. And so I think that cars

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are an incredible waste of money. And I think the

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best thing to do, like you said, what is it

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is unquestionably the best thing to do is by Honda

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Toyota and buy them. Like I said, somewhere in that

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three to six year old used you know, to where

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you're getting at thirty at least thirty to forty percent

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off the original sticker price and put as much down

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as you possibly can.

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Speaker 2: And that's that's the right thing to do. Drive them

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till the wheels fall off.

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Speaker 1: Okay, So then are you liking me? Because that's great advice?

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Are you like me? Where you see like you get

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on social media and you see these people who are

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buying their brand new sixteen year olds, like brand new

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BMW's and like right, and they're like, look, I just

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we just got Susy a brand new twenty twenty five

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decked out like BMW And I'm like that or is

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this as humble?

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Speaker 2: What is this? What are you doing? What? And the

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crazy part to me is too a lot of them

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are making payments on it, right, which is just crazy

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to me.

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Speaker 1: Yeah, it's like and then what do they have to

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aspire to? Because I got to tell you, I my

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very first car was like a nineteen eighty Toyota Corolla

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piece of shit with no radio in it. I had

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to put a boom box in the front seat, which

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is probably a safety hazard. I don't even know, but

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it's like it. But I just remember, like you have

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if you have a piece of car that you know,

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sometimes it was so bad that I think we had

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to like push it to get it to start. You know,

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just pieces of crap because they make you want to like,

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they aspire you to get better, to do better, buy

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your better car. In the long run, I just I

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can't imagine my parents buying me a brand new anything

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when I was six hours.

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Speaker 3: Yeah, well, my if my daughter wants to imagine it,

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she can go ahead and do that, because that's about

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as close as she's going to get to it. But yeah,

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to Matchers, I had an eighty six g Cherokee. Now

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I I I would hesitate to call it a pos

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I've got a lot of affection for it. But funny enough,

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you'd be driving down the road and it was kind

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of it was kind of a joke we did. I'd

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pull the keys out and just throw them to somebody

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in the car, right because you could pull the keys

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in and out and then and then we'd be at

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an intersection and the cars would pull up behind you,

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and if I pushed the rear window washer fluid, they

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shot the washer fluid directly out the back and so

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it was like it was like urinating on the hood

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of the.

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Speaker 2: Car behind US, and so we had we had a

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we had a we had a blast with that, right,

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I mean that's really different.

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Speaker 1: I mean I know that it was different back then,

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Like everything about the world was different. Safety is different.

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I mean I get it, you want your kids to

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be safe and everything, but there was something to be

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said for those crappy first cars.

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Speaker 2: You know. Yeah, well, hey go, let's go right back

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to what I was just saying. Right, super ru is

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a really safe car.

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Speaker 3: That's a Japanese car, right, So, so once again talking

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about the Japanese made you know, like I said, three

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to six year old used, those are great, safe, fuel efficient,

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awesome cars. I just, you know what's funny because I

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think the point that you make, that you bring up

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is actually one that.

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Speaker 2: I don't think a lot of people focus on.

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Speaker 3: And honestly, I think it's probably the biggest point to

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me if I think about it, other than not being

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spoiled and not being bad people, you're also not doing

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the kid a favor because I you know, I re

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simply well, no, what is this year and a half ago?

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Speaker 2: Two years ago I got my first like nice car,

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it was still used.

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Speaker 3: I can't bring myself to broke band new, but it

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was like a year and a half old with sixteen

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thousand miles on it.

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Speaker 2: Yeah. I still get tickled getting in that thing every day.

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Speaker 3: But the reason why is because I drove that Jeep

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and I drove that two thousand and one fourteen.

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Speaker 1: You wait, you waited to get it. Yeah, yes, you

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worked so hard. Yes, and it wasn't handed to you

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in that car.

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Speaker 2: Yeah exactly.

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Speaker 3: And then also when I finally purchased that car, I

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didn't walk out five days after purchasing it and seeing

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it sit there and going no, I've got to make

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that car payment. That's the other thing too, right, these

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car payments that people like. You know, if you can

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get a good deal of a good financing package, you know,

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that's fine, I understand.

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Speaker 2: But the goal should be to try to pay for

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the car. Cast you don't want to finance, you're appreciating asset.

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Speaker 1: Then you're are you against leasing them? Is leasing a

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really bad thing? Or is that something that say, like

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I retire one day and I'm like, I'm just going

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to get a new car like every three years. Would

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you would you say leasing's okay? Because I listen, when

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I retire, I'm not going to be driving a whole lot,

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and my mileage will be really low because I'm going

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to be like this old lady who just sits at

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home a lot.

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Speaker 2: Yeah, let's just get real.

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Speaker 3: So two ways to look at it, right, What I

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would say is this, if you are in a place

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financially to where the the when you're thinking about whether

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to buy or to lease, that decision is not a

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monetary decision to you, right, then I'd say go ahead

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and lease, right Because if you're if you're at that

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point in your life where a car, a car.

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Speaker 2: Is a cost to you, you're okay with that, and

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you just like a new car every two to three years.

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Speaker 1: Right because you've never had them. You've never had the

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new cars, and you're like, you know what, I'm retired now,

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I want to have like a new car every couple

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of years. I'm just going to lease them and just

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do the least thing.

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Speaker 3: And I know a lot of folks that do that.

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Is it a better decision? It depends on how you

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get the lease. You know, when we say buy or lease,

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a lot of it depends on how you buy or lease, right,

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So you can get good or bad deals there too.

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Speaker 2: But I would say this.

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Speaker 3: If you are talking about wanting to get a new

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car every two to three years, I think the LEAs

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thing makes more sense than buying.

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Speaker 2: Yeah, that's that's my opinion. Truthfully, Financially, it's pretty close.

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Speaker 3: Yeah, which shouldn't surprise most people, right, Like, that's it's

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pretty close.

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Speaker 2: For a reason.

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Speaker 3: If you cannot afford to purchase the car outright though,

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and it is a financial decision, you should not, you know.

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I it's crazy. I see situations all the time where

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people have got over fifty percent of their annual income

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in cars sitting in their garages or car and yeah,

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and I literally three to thirty five hundred dollars a

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month in car payments between the two peoples.

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Speaker 1: God, it's just out. And then that doesn't even include

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insurance and all that.

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Speaker 2: I know, that's a mortgage that I remember what twenty

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five dollars. That was a crazy mortgage.

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Speaker 1: Yeah, that's just insane, I know, I know.

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Speaker 3: And you're just burning you're burning that money. It's on

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a depreciating asset. It's a guaranteed loss. And even if

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you should have you know, you know, you're thinking about

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it correctly, Like, even when you can afford.

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Speaker 2: To go pay cash for a car. It should hurt.

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Speaker 3: And the reason it should hurt is because you're thinking

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about money correctly, and you're sitting there going, boy, that's

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a lot of money to stick in something that I

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know is going to lose money.

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Speaker 1: Yeah, it immediately depreciates. It's exactly what it does.

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Speaker 2: Yeah, we continue to do so. Right.

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Speaker 1: Yeah, do you ever see the Do you ever see

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the prices of cars coming down? Or do you think

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that we're just like now, we're just on a spiral up.

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Speaker 3: You know it. I think that what you've seen, I mean,

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I don't think you're going to see cars continue to

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rise and increase in price at this pace.

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Speaker 1: Yeah.

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Speaker 2: I think that what you've seen is kind of a renormalizing.

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Speaker 1: Of car values and nabilize a little.

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Speaker 2: Yeah, it should. I mean, you know, I think I

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think cars are responding. I think car prices have responded

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to a lot of things.

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Speaker 3: I mean, go look at what's happened to the average

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minimum wage price around the country over the last five years. Right, Yeah,

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that's gonna have a dramatic and that's gonna have a

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dramatic impact on the price of cars. But yeah, cars

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will continue to go up I mean, you know it's

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not it's not that long ago. I mean, shoot, you

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know what early to mid seventies, you could have yourself

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a pretty cool, brand new car for thirty two hundred bucks.

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Speaker 1: Right, and now you're looking at an SUV for like

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one hundred something grand.

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Speaker 3: It's crazy, no, I know, and not even crazy like,

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like I said, a nicely outfitted suburban, not the GMC.

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Speaker 2: You're you're around ninety to one hundred thousand dollars for

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one of those.

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Speaker 1: I mean, it's just insane, right, And I remember, I'm

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old enough to remember when you could buy a condo

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for that much.

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Speaker 2: Oh yeah, you know, it's like that's like I know.

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Speaker 1: So for Gen xers, it's especially painful to look at

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the prices on cars these days because you're like, wait

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a second, can't my brain cannot compute, I can't.

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Speaker 2: Well, and that's what why people look, you know. And

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I've got tons of clients.

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Speaker 3: I've got people that have gotten rich all kinds of ways,

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via investing, via working for themselves, via working for somebody else.

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I'll tell you what the most common thread that I

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see you if you could take the average person and

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get them to be fiscally disciplined just around cars, it

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would make a substantial difference in their financial well being

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thirty to forty years out. The amount of money that

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we waste as a society and as a country and

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a culture. Really it's more about a culture than is

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a country. But on cars, it's just it's just astounding,

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you know. And I don't think people think about it

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that way, and they should. And it's just if they

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could liberate themselves from that one thing and be disciplined

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with that one thing and take that extra money that

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they would be spending on cars and invest it, that

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alone would make a massive difference in the end of

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their story.

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Speaker 1: And this is why everybody needs to talk to you exactly.

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Why So where can they find you and talk to you? Where?

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Speaker 2: Tell us you?

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Speaker 3: Yeah, you can find us at Barcapitalmanagement dot com, Know

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your Risk Podcast dot com. We do our daily show,

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the Daily Dots. Not hard to find it all. Yeah,

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it's is Borordcapitalmanagement dot com. Know your Risk Podcast dot

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com And throw those into Google and search for us

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on YouTube and you'll find our video content on there.

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Speaker 2: And yeah, not hard to find.

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Speaker 1: He's the guy to help you get rich. You guys,

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do it. Zach Abraham, thank you, Thank you, Fun as always.

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Speaker 2: Investment advisory services offered through Trek Financial LLC and SEC

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Registered Investment Advisor.

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Speaker 3: The opinions expressed in this programmer for general informational purposes only,

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and are not intended to provide specific advice or recommendations

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for any individual or on any specific security. Any references

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to performance of security so thought to be materially accurate

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and actual performance may different invests spans involved risk, and

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are not guaranteed.

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Speaker 2: Past performance doesn't guarantee future results. Track twenty four three

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zero eight