Is it Wise to Purchase a New Car Without a $1M Net Worth, According to Dave Ramsey and Other Experts?

Financial expert and host Dave Ramsey has sparked a debate with his advice that individuals should not buy a new car unless they have a net worth of $1 million. Ramsey, known for his tough love approach to personal finance, believes that buying a new car is only justified for those with a significant net worth.

While Ramsey’s advice may resonate with some, not everyone agrees with his stance. Stephen Kates, a principal financial analyst, argues that blanket financial advice like Ramsey’s fails to consider individual circumstances and nuances. Kates believes that the cost of the car and the terms of any loan are more important factors to consider than whether the car is new or used.

Other experts support Ramsey’s reasoning but suggest a more nuanced approach. Peter C. Earle, a senior economist, points out the immediate depreciation and additional expenses associated with new cars, making used cars a more financially sound choice for many individuals.

Despite the differing opinions, Ramsey’s advice has sparked a conversation about the financial implications of buying a new car. As individuals navigate their financial decisions, it’s essential to consider their unique circumstances and goals to make the best choice for their financial well-being.