Prices for so-called toy commodities -- think boats, wave runners, motorcycles, and classic cars -- are much higher.
Wasn’t so long ago that you could snag a 1966 Ford Mustang convertible, one of the most iconic muscle cars ever, for $18,000 to $20,000. Now a pristine Mustang might go for $30,000 and up.
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Or how about an inboard cruiser, one of the most popular boat categories, where prices have risen more than 20% since 2019?
Personal-finance guru Dave Ramsey is taking aim at the rising price of favored and often expensive consumer toys. He issued a warning about overpaying for a luxury commodity these days.
“There’s nothing wrong with owning some nice things,” he said on his Sept. 14 broadcast. “Just don’t let your nice things own you.”
“Whatever cash you put into a boat, camper, or RV, you need to be able to set that amount of money on the middle of the floor and set fire to it, and that would be okay with you,” he added.
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The value of those items declines even faster than that of cars, Ramsey warns.
'Make sure you can afford to lose the money': Ramsey
“Make sure you can afford to lose that amount of money and have it not affect your life because that’s basically what you’re doing,” he said.
Ramsey has long criticized the idea of owning things that go down in value, noting that the higher the price for a luxury toy, the more money you’re burning.
“The total value of all your vehicles should be less than half your annual income,” he says.
He also says not to have too much of your net worth tied up in things that are going down in value. “For example, if you make $40,000 per year, you don't need to own a $25,000 car,” Ramsey suggested.
That’s especially true as you go up the annual-income ladder and start buying those pricey classic cars and power boats.
“Too often, we buy things we don’t need, with money we don’t have, to impress people we don’t like,” he said.
“Let’s stop doing that.”
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