Suze Orman, the well-known financial guru, has long advocated buying cars and keeping them for extended periods, a strategy that aligns with current automotive trends. In a recent interview with Go Banking Rates, Orman emphasized the financial wisdom of long-term car ownership.
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“When I buy a car, I keep it for at least 10 to 12 to 15 years or longer,” Orman said. “Right now, I am going on the 12th year that I have owned my car and I have no plans of getting rid of that car for years to come.”
Orman’s approach mirrors the evolving behavior of American car owners. According to S&P Global Mobility, the average age of cars and light trucks in the U.S. reached a record high of 12.6 years in 2024, up from 12.5 years in 2023. This trend represents a significant increase from two decades ago when the average vehicle age was just 9.7 years.
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She also criticizes the practice of frequent car upgrades, particularly leasing. “I don’t buy a car every three years like most of you do,” she said. “I don’t lease a car every three years like many of you do, simply to drive a car to impress people you don’t even know at a stop sign with money you probably don’t even have.”
While Orman’s advice may seem conservative, it’s increasingly relevant given the current automotive market and rising car payments. According to Experian, the average monthly car payment for new vehicles was $735 in the first quarter of 2024, a 0.4% increase from the previous year. Used car payments also rose by 0.4%, reaching $523 per month.
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These high payments are largely due to the increasing costs of vehicles. According to Kelley Blue Book, the average price of a new car reached $48,247 in late 2023. Even used cars averaged $26,091, highlighting the significant financial commitment involved in vehicle purchases.
The financial implications of buying versus leasing are substantial. A 2024 analysis by MST found that over 39 months, leasing resulted in a total cash outlay of $16,622.19 compared to $18,910.09 for purchasing. However, purchasing builds equity, with the vehicle retaining a value of $11,512.48 at the end of this period.
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Despite these high prices and payments, car ownership remains prevalent in the U.S. A Forbes Advisor report indicates that 91.7% of U.S. households had at least one vehicle in 2022, with 22.1% owning three or more.
As vehicle costs continue to rise and economic uncertainties persist, Orman’s approach to car ownership may become increasingly appealing to consumers looking to maximize their automotive investments while minimizing long-term expenses. By avoiding the cycle of frequent upgrades and high monthly payments, consumers can potentially save thousands of dollars over the life of their vehicles.
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This article Suze Orman Says Keep Your Car For ’15 Years Or Longer’ Instead Of Leasing A New One Every 3 Years Just To Impress Strangers originally appeared on Benzinga.com
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