I graduated in 2003 and had to buy a car. I was driving an 88 Chevy Blazer that was starting to hit around $750 per month in maintenance. Final straw was when a cylinder was losing compression. This was already on an SUV that had its engine rebuilt and had more than 165K miles on it. It had a Kelly Blue Book value of about $100.
So, couple months out of college, I bought a modest Chevy Cavalier. Monthly payments were 1/3 of what I was paying in repairs, around $240/month. I could afford the car payments, I couldnt afford the monthly repairs.
I didn't buy my first fun car for about another 4 years. By then, had a well paying job, only debt was what lingered on the previous car loan. At the time, didnt have a great salary, probably around $100k, but I was getting generous bonuses. Every bonus I had went to paying off atudent loans before I did anything more than a couple hundred splurge. I think that I had my student loans paid off in the first 3 years at my first salaried, full time job.
I think the key, for me, is that when my income tripled from when I was an intern, I didn't change my lifestyle. I lived the same, with a slightly more expensive so I could be closer to work & public trans. Everything went to paying down debt.
I think this is the misstep for younger people that suddenly come into earning a lot more money: more money in, increase the life style and spend the increase in income. It's an easy trap to make. And no, I'm not ragging on Millenials. Its a problem that has happened to previous generations in the same situation. I think it might be a lack of personal financial maturity (you know, out on your own, gobsmacked with more money youve ever seen in your life), not a generational thing.
Edit: clarification about exspense on the old vehicle
Your frugality and dedication to eliminating debt is admirable. And it is true that many younger people (and older people too!) prefer spending over saving & reducing debt.
However... if you were making $100k 4 years after graduating college, you were doing better than probably 97% of people who started college at the same time as you (I don't say graduate, because many didn't). Maybe 99%.
I graduated in 2003 and had to buy a car. I was driving an 88 Chevy Blazer that was starting to hit around $750 per month in maintenance. Final straw was when a cylinder was losing compression. This was already on an SUV that had its engine rebuilt and had more than 165K miles on it. It had a Kelly Blue Book value of about $100.
So, couple months out of college, I bought a modest Chevy Cavalier. Monthly payments were 1/3 of what I was paying in repairs, around $240/month. I could afford the car payments, I couldnt afford the monthly repairs.
I didn't buy my first fun car for about another 4 years. By then, had a well paying job, only debt was what lingered on the previous car loan. At the time, didnt have a great salary, probably around $100k, but I was getting generous bonuses. Every bonus I had went to paying off atudent loans before I did anything more than a couple hundred splurge. I think that I had my student loans paid off in the first 3 years at my first salaried, full time job.
I think the key, for me, is that when my income tripled from when I was an intern, I didn't change my lifestyle. I lived the same, with a slightly more expensive so I could be closer to work & public trans. Everything went to paying down debt.
I think this is the misstep for younger people that suddenly come into earning a lot more money: more money in, increase the life style and spend the increase in income. It's an easy trap to make. And no, I'm not ragging on Millenials. Its a problem that has happened to previous generations in the same situation. I think it might be a lack of personal financial maturity (you know, out on your own, gobsmacked with more money youve ever seen in your life), not a generational thing.
Edit: clarification about exspense on the old vehicle