True of False? Most people who drive nice cars are NOT wealthy...

Drive through western PA. It's all $70 pickups parked next to dilapidated trailer homes. I imagine most rural areas are like this.

I think it's more of a problem when it's a younger person. When you're older, you could have saved up a few thousand dollars a year for decades and finally gotten that nice car. But when a young person buys a $50k+ car and their income is not 6 figures, that just doesn't seem smart to me. They haven't been working long, so they don't have a bunch of savings. Often these people are also renting apartments. It seems more wise to continue saving money to use to purchase your house/condo instead of continuing to blow $2k+ on rent every month that you never see again.

If you are saying that a 1.9% auto and 2.5% home loan while risk-free interest rates are currently ~3x higher are holding me by balls, I’d say I like how debt fondles my balls.

You are probably right. In 1957 Buffet was operating 3 investment partnerships. He purchased a 5-bedroom house in Omaha for $31,500 and still lives there today.

Wealthy is when you have enough money/assets that you can tell your boss or employer or anyone else to "F*ck you" and it matters not one iota.

I have 3 BMWs (also 3 drivers in the household and 2 of them were CPO used), but I've been a car enthusiast since I was a kid. My most expensive, rare, and analog car wouldn't turn any heads outside of the enthusiast community. I participate in racing schools and track days. It definitely doesn't attract females. I have friends with similar incomes that have $100K+ boats and nobody seems to give them a hard time.

I make a good living, but far from the the Mazda guy with the $2.5M AGI.

I met a guy last summer who has a small fleet of planes, including a nice twin that he uses to travel between his (waterfront) properties that are in different areas of the country. His car: a beat up Ford Explorer.

During Covid, it happened that the car line for the food bank (at least a mile away) came along my house. It was astonishing to see how many nice cars showed up for that.

This.

My great-uncle did very well for himself in CLE. But his vehicle? A '93 Chrysler New Yorker he had for 15 years until he passed away. Other relatives I know drove old GM iron like LeSabres and Olds 98s.

My wife has a manager that works for here that can't afford furniture for her family but drives a escalade and othe employees that drive BMW's, Cadillacs and Audi's that make 35-50k/year.

Pay check to pay check is not rich

If you have to buy the car by making monthly payments then by my definition you can't afford the car.

If we define the threshold for "wealthy" at the 80th percentile, the answer is True for values below the plotted line (y=.8x/.2). Suppose 50% of wealthy people have nice cars. If more than 12.5% of non-wealthy people have nice cars, most people who have nice cars are not wealthy. https://imgur.com/a/EoDyq79

Looking at it this way, I don't think it's a ridiculous question, but only because of the specific wording. If the question is instead, "Are most nice cars driven by non-wealthy people?" I would say no, because I think a wealthy person is far more likely to own multiple nice cars than a non-wealthy person.

My new minivan was about double the price of my used Z4 :)

Except when I first started work, I pay cash for cars and unfortunately, have almost no trade ins (extended family seems to always need a car).

The cash mentality is a natural brake for buying expensive cars. No payments, just a big check and cars seem to have outstripped inflation (yes, new cars have all kinds of electronics on them and are not comparable to old cars, but I just want a car).

My state also has no limits on dealer prep and document fees and there are taxes.

My father bought new fancy cars all the time and he was a shallow person. It really was part of his identity, a sad fact. But as a result he convinced me not to do the car thing.

Just because they work a 50k/year or less job doesn't mean their income is solely from that job. Smart people have extra ways of getting income and multiple revenue streams. Anyone who thinks everyone's net worth is what their job is--theyre a narrow minded sheep.

Good point. One of my BMWs (used) was less than a typical new Kia, Hyundai, or Toyota. I prefer driving experience to tech, and I'm willing to maintain it properly.

Leasing entry level luxury cars is the typical segment that's driving beyond their means.

It really depends. If I see a ~5+ year old C class or 3 series (or a 2 or 1 series) that's a little rough around the edges, my first assumption is someone bought something they couldn't afford. If I see a brand new S class or 7 series, I assume it's probably someone with money. There's definitely outliers.

Some people do buy them purely for status and don't care one bit about the car itself. My sister drives a base level Audi, and while she's very wealthy, she's definitely attracted to the whole "Oooh it's a German car" marketing bit and is unaware of the fact that it's just a VW with different badges and maybe some fancier leather. Thinking an Audi is going to be superior in almost any way, especially at the base trims, to a non-German car is funny. Reliability with almost all new cars is getting worse as they're getting more complex. Give me a 1999 Mercedes with an M113 any day over whatever their new crap is, I'll take that engine through the apocalypse while you're stuck replacing a CVT.

My other wealthy sister drives a Land Cruiser that probably cost 90k but looks totally unassuming and to her it's just a comfy family hauler. If I see a nicer, newer Land Cruiser, I assume they're wealthy. "Stealth wealth," if you will. If I see a nicer, older LC, I also assume they're wealthy. Her husband is currently driving his ~2000 Suburban into the ground because he doesn't care about cars one bit.

It I see someone with a real enthusiast car that's well kept, I assume they're probably reasonably well off but not necessarily loaded. You don't have to be rich to own a Silvia, especially if it's a passion project and you can turn a wrench. Unless it's something wild like a low mileage V Spec GTR, then they're probably rich.

I live in a very very wealthy small town in the San Francisco bay area...

most homes around here go for 2+M minimum, even the not that nice ones (i just live in a nicer apartment complex for reference). One would be surprised by some of the cars sitting in the driveways. A lot of basic japanese sadans/ no frills SUV (rav4 / highlander,etc...). And these people have Millions stashed away.

If you're leasing, it probably means you can't afford it in the first place. but leasing can make a lot of sense financially too.