The price of new trucks is beyond comprehension!

[BobsYourUncle]

It was 42 years ago today, seems so long ago, yet still a strong memory in my head, a milestone I reached in my humble beginnings into the home renovation industry building solariums and such.

Yes, it was on this day, October ten, nineteen seventy eight when I had been only 4 years into my lifetime career when I worked my way to being able to purchase my first brand new truck!

Yup, 10-10-78 I drove off the lot of Phillips Chev - Olds in Penticton BC driving my nice shiny new 78 Chev 3/4 Ton Camper Special.

As I pulled out of the lot and turned left on to Westminster Ave and headed east towards home, I though I had lost my marbles, that I am a total idiot.

Who in their right mind would pay $7714. For a new truck. All taxes, fees, dealer prep and all the rest of the junk in came to $8,109.70 out the door...... Bob, you are out of your mind! I kept saying to myself. Financed it on the never never plan I did. How will I ever pay for it? I was barely 24 years old.

It was a great truck, I had it for 26 years and about 527,000K on the odometer when I retired it, still in decent shape.

Hmmmmm......

42 years later, my 2007 truck in sig is getting worn out. 408,800K on the clock and I am eyeing the shiny new trucks on the lot.

92 grand $$$$$$$ for something similar with a few more bells and whistles.

No, just no! That's what, about a dozen times the price I paid back then?
Gosh how can they justify that?

Wow! Just wow. Amazing how expensive pickups have become. All these fancy gizzmobops they have, someone has to pay for all that I guess..

Guess I'll just keep fixing what I have. It was $1423.77 yesterday for a water pump and a U-joint. Expensive!

Oh well, that's life! 🙂

My story of the day.

[4x4ord]

ShinerBock wrote:

4x4ord wrote:
Shiner I agree with you that land is often a good investment so I might borrow money to buy land but not to buy a truck.

That is not a wise decision. It is better to pay cash for the land since land loans are generally around 5% with excellent credit. Auto loan's are around 2-3% with excellent credit. So it would be best to pay cash with the land since you are paying more interest. The standard return on investment in a low risk stock/bond market account such as 401K. IRA, and so on is 6-7%.

So the land will cost you 5%, the vehicle will cost you 2-3%, and the investment will gain you 6-7% on average. Paying cash for the land will save you more money than paying cash for the truck, but they both will not save you enough to overcome the standard amount ROI you would make on investing the money.

Of course this all assumes that you have excellent credit above 700 and can get the very best rates. If not and the interest rate is greater than standard ROI, then it would be better to pay cash. However, if this the case then you have other issues that might need to be addressed.

The last land purchase we made was at 1.8% interest... The previous owner held the mortgage. It is not likely that I'm going to be borrowing money at 5% interest ever.

[ShinerBock]

A1ARealtorRick wrote:

ShinerBock wrote:

4x4ord wrote:
Shiner I agree with you that land is often a good investment so I might borrow money to buy land but not to buy a truck.

That is not a wise decision. It is better to pay cash for the land since land loans are generally around 5% with excellent credit. Auto loan's are around 2-3% with excellent credit. So it would be best to pay cash with the land since you are paying more interest. The standard return on investment in a low risk stock/bond market account such as 401K. IRA, and so on is 6-7%.

So the land will cost you 5%, the vehicle will cost you 2-3%, and the investment will gain you 6-7% on average. Paying cash for the land will save you more money than paying cash for the truck, but they both will not save you enough to overcome the standard amount ROI you would make on investing the money.

Of course this all assumes that you have excellent credit above 700 and can get the very best rates. If not and the interest rate is greater than standard ROI, then it would be better to pay cash. However, if this the case then you have other issues that might need to be addressed.

A lot of what's being said is based on the given fact that a truck will depreciate (and do so rapidly), whereas the land is hopefully an appreciating asset, although we all remember 2008. Why even pay 2 - 3% interest on a rapidly-depreciating asset? Cash for the vehicle, finance the land .... or cash for both if you are so blessed, but few are.

2008 was actually a really good year for me. Land prices dropped and I was able to pick several plots for a lot cheaper than the year before. Luckily I sold all my properties about a year before it hit and I was able to see it coming long before the housing bubble burst. That is the good thing about market bubbles. You can generally tell when they are about to pop by looking at multiple factors.


As I said before, nothing is assured, but doing your homework to help you make the right investment goes a long way in decreasing your risk. The risk will always be there and many may not want to take the risk and put the money in saver investments with lower return.

[RetiredRealtorR]

ShinerBock wrote:

4x4ord wrote:
Shiner I agree with you that land is often a good investment so I might borrow money to buy land but not to buy a truck.

That is not a wise decision. It is better to pay cash for the land since land loans are generally around 5% with excellent credit. Auto loan's are around 2-3% with excellent credit. So it would be best to pay cash with the land since you are paying more interest. The standard return on investment in a low risk stock/bond market account such as 401K. IRA, and so on is 6-7%.

So the land will cost you 5%, the vehicle will cost you 2-3%, and the investment will gain you 6-7% on average. Paying cash for the land will save you more money than paying cash for the truck, but they both will not save you enough to overcome the standard amount ROI you would make on investing the money.

Of course this all assumes that you have excellent credit above 700 and can get the very best rates. If not and the interest rate is greater than standard ROI, then it would be better to pay cash. However, if this the case then you have other issues that might need to be addressed.

A lot of what's being said is based on the given fact that a truck will depreciate (and do so rapidly), whereas the land is hopefully an appreciating asset, although we all remember 2008. Why even pay 2 - 3% interest on a rapidly-depreciating asset? Cash for the vehicle, finance the land .... or cash for both if you are so blessed, but few are.

[RetiredRealtorR]

Groover wrote:
I keep reading complaints about how much the Limited versions costs but you can still buy the XL version if that is what you want. It is as nice as my fully loaded 1991 Ford pickup and it is generally heavily discounted.

However today, buying a base model (for example, the XL), come resale time, the market for such a vehicle will be colder than a mother-in-laws love.

[ShinerBock]

4x4ord wrote:
Shiner I agree with you that land is often a good investment so I might borrow money to buy land but not to buy a truck.

That is not a wise decision. It is better to pay cash for the land since land loans are generally around 5% with excellent credit. Auto loan's are around 2-3% with excellent credit. So it would be best to pay cash with the land since you are paying more interest. The standard return on investment in a low risk stock/bond market account such as 401K. IRA, and so on is 6-7%.

So the land will cost you 5%, the vehicle will cost you 2-3%, and the investment will gain you 6-7% on average. Paying cash for the land will save you more money than paying cash for the truck, but they both will not save you enough to overcome the standard amount ROI you would make on investing the money.

Of course this all assumes that you have excellent credit above 700 and can get the very best rates. If not and the interest rate is greater than standard ROI, then it would be better to pay cash. However, if this the case then you have other issues that might need to be addressed.

[4x4ord]

Groover wrote:

4x4ord wrote:
Shiner I agree with you that land is often a good investment so I might borrow money to buy land but not to buy a truck.

The last time that I bought a truck I could have paid cash but I borrowed money at 2% and left that $50,000 of my own invested where it has been earning about 9%. So I saved 15-20 thousand by borrowing the money. Your results may vary.

In my case I keep my truck new so the little bit of cash that I put towards the replacement cost is always just cash on hand.

[Reisender]

Groover wrote:

4x4ord wrote:
Shiner I agree with you that land is often a good investment so I might borrow money to buy land but not to buy a truck.

The last time that I bought a truck I could have paid cash but I borrowed money at 2% and left that $50,000 of my own invested where it has been earning about 9%. So I saved 15-20 thousand by borrowing the money. Your results may vary.

Yep. We do the same...sort of. The first third is cash to cover the taxes and never be upside down. The rest is borrowed and although our investments seem to be averaging around 7 percent that is more of a risk profile selection.

And yes. YMMV

[Groover]

4x4ord wrote:
Shiner I agree with you that land is often a good investment so I might borrow money to buy land but not to buy a truck.

The last time that I bought a truck I could have paid cash but I borrowed money at 2% and left that $50,000 of my own invested where it has been earning about 9%. So I saved 15-20 thousand by borrowing the money. Your results may vary.

[Groover]

I keep reading complaints about how much the Limited versions costs but you can still buy the XL version if that is what you want. It is as nice as my fully loaded 1991 Ford pickup and it is generally heavily discounted.

[Reisender]

One has to be careful reading a thread like this that includes prices. I believe there are 6 countries in the world that use the name “dollar” for their currency. At least three of those countries have frequent posters here. Australian, Canadian and US dollars are different animals. Best to look at the location of posters before making comparatives.

In the next few years electric trucks will also be part of the landscape for truck buyers. Prices will be all over the map depending on the manufacturer. All manufacturers are planning on producing electric trucks with the exception of Dodge/Ram who will see their market share begin to drop as a result. Interesting times.

[4x4ord]

Shiner I agree with you that land is often a good investment so I might borrow money to buy land but not to buy a truck.

[4x4ord]

^^^^I was talking about justifying the purchase of a new truck based on net worth rather than income..... if a person has a net worth of 1.8 million and an annual income of only 200,000 his income might dictate he should only be driving a 20k truck but because he has managed his money well his net worth could allow him to justify paying the $90k for a new truck if he so desired. Personally I have only made vehicle payments for, I think, six years over the past 40 years of driving.

[ShinerBock]

On the flip side of this, if you are in your retirement age with more than enough money to life your life comfortably and just don't want the payment, then by all means pay cash. It may not be the smartest decision financially, but the whole point of your investments at a young age is for you to live off of them and enjoy them when you are older.

As I told my father many years ago when he was making his will and asked me what I wanted. I told him nothing of value other than a few family items that are worthless to anyone else, and to use his money to live on and be happy in his remaining days. Although the exact words I used were "I don't care if you use your money to snort cocaine of a hooker's ### in Vegas if it makes you happy, just as long as you are using it on what makes you happy and have enough to live on the rest of your days. You earned the money, you use it. Don't worry about giving any of it to me."

[ShinerBock]

4x4ord wrote:
^^^^ Another problem with Shiner’s advice is that it means making truck payments. I might have investments that’ I can cash in to pay for a new truck but I might not have an income and budget that allows me to put $1500 per month towards a $90K truck..... maybe I’m using that 1500 per month to make a land payment.

My comments were in reference to you saying that you would pay cash on a $90k truck. Although, even in this scenario, you would still be better to leave those investments in place rather than cashing them out to pay cash for a truck if you can get a loan below a 3% interest rate. If you have to cash in these investment, taking money away from your future self, then I would re-evaluate the need for a $90k truck and would probably wait until that land is paid off. My advice from before is all about using money wisely to your advantage over time, not foolishly just for instant gratification.

[4x4ord]

^^^^ Another problem with Shiner’s advice is that it means making truck payments. I might have investments that’ I can cash in to pay for a new truck but I might not have an income and budget that allows me to put $1500 per month towards a $90K truck..... maybe I’m using that 1500 per month to make a land payment.