10 Tips to Vehicle Ownership…

1.) Determine how much you can afford. (Your total transportation expense) should only be 10-15 percent of your bring home pay (not gross pay). 

Example: If your take-home pay is 3,000 dollars monthly (after taxes), your car payment, fuel, automobile insurance, car maintenance should only be 300-450 dollars per month. What percent of your income do you WASTE on your vehicle? Remember to calculate all fees associated with the car. Categorize each vehicle expense into these categories.

A.) Vehicle Payment (includes interest)

B.) Taxes, tags, fees

C.) Parking

D.) Fuel/Maintenance (cleaning, oil changes, tires, etc.) 

E.) Accessories 

2.) Find the vehicle that suits your personal needs. Forget those fancy brands and focus on the utility/functionality of the car. 

3.) Purchase a used car, if at all possible. New vehicles lose about 20 percent the first year, then 15-25 percent each year after that. Based on this analysis, it’s best to find a car 2-3 years old and purchase. Consider pre-owned vehicles with warranties! 

4.) Finance cars when interest rates are less than 5 percent. Never pay cash. I hear ole timers say, “I paid cash for it.” I repeat, finance if possible. Your money can make you more in an investment instead of a depreciating asset.  Why pay cash for a car if you can take that cash and invest in the S & P 500 and gain 7-10 percent returns and finance that car for 1.99 percent interest? Only an illerate investor would!

5.) Know your credit score prior to your purchase.

6.) Purchase a vehicle with the future in mind. If you are thinking about a family, don’t purchase a subcompact car or corvette! 

7.) Get a pre-approved loan. Figure out your interest rate before you even begin car shopping. If it’s higher than 5 percent, DO not purchase a vehicle. Do things to get your credit better before purchase. 

8.) Never purchase a vehicle on the same day of test-driving or window shopping. Always walk away and leave emotions aside. Don’t be afraid to use prices from one dealer to pit against another dealer to get the best deal possible. 

9.) Don’t negotiate on payments. Negotiate on the bottom line. When a car salesperson keeps asking about “the monthly payment” you are looking for…RUN! This is a sales tactic.

10.) Avoid any vehicle loan over 60 months. Buyer Beware! If you have to finance longer than this, you cannot afford your vehicle.

Sources: https://cars.usnews.com/cars-trucks/best-car-buying-tips#6) -Don’t-Buy-Too-Soon

Are you buying an automobile ? Think Twice…

Hello, fellow dividend dudes and dudettes,

We are now beginning this journey together to achieve financial independence through passive income. We cannot discuss passive income without discussing personal economics. Hopefully, thus far, you have gained valuable information about your finances, from major home purchases to those nagging “Hinder me” expenses. As we begin to evolve with this train of thought, You will ultimately start to think twice before purchasing once. Hell, maybe three or four times!… Remember, the more we think about purchases before purchasing, the less likely we will make that dumbass impulse purchase. The fewer purchases we make, the more fresh capital we can unleash toward our “real investments.” This thought process, metaphorically speaking, should turn our financial investment portfolios into a money machine that will run well into the future. 

As the title of this post suggests, we now must discuss automobile purchases. Besides your home, an automobile purchase is the second most expensive purchase we will make in our lifetimes. Most of the time, the dumbest purchase we will make in our lifetime. I once overheard a friend boasting about his new shiny purchase. Ford Motor Company equipped his new purchase with a leather interior and the best trim package available at the time. Wow!! It was sparkling, polished, and damn it smelled fantastic! The purchase may not have been the smartest decision financially one could make, but he told everyone how “he got a good deal with equity” on his purchase because of a trade-in! Man, I sat and pondered at that famous expression, “trade-in, good deals, equity and cars,” with a meek appearance. Those words shouldn’t intermingle together, much less verbalized in the same sentence in an open forum for others to hear. 

At that instant, the minute hand on the clock seemed to stop, my eyes opened, and I realized how stupid people are! I’m not the only one either! Next time when you are racing around town in your shiny car, paying those endless bank notes, look to the right and left at that red light. You will see BMW, Jaguar, Mercedes, Tesla, etc. with many aftermarket upgrades. I don’t bet often, but I will make a bet here. I bet many of these cars belong to people who make less annually than what the vehicle is worth! But I guess if they are building equity in that BMW, why not? (joke) 

Now, like we have discussed previously in many posts, there are hinder-me and help-me expenses with every purchase. An example of an automobile payment would be a “Hinder Me” cost if you bought a car/SUV/truck, and the price or payment is not as reasonably low as possible to achieve the same result. 

An example of “Hinder Me” Car Expense: 

You need to buy a car for transportation to and from work.

Instead of purchasing a used low mileage Toyota Corolla several years old, you go out and buy a brand stinking new BMW 6 series (MSRP $70,000) 

A Corolla will perform the same function as a BMW 6 series to commute around the city. Why spend $70,000 when you can achieve the same goal (commuting) for under $15 grand.  Are you trying to keep up with the Jones? Are you trying to be someone you are not? Are you trying to play the rich game and keep up with the Jones? Listen, if you are still working a 9-5, everyone knows you are not wealthy.  Please stop pretending.

As you can see, The Beamer is a “Hinder Me” expense because the BMW 6 series payment is not as low as reasonably possible. A corolla payment is as low as reasonably possible.  Remember this! 

Now, let’s dive into my coworker’s situation above; First, Ford is a terrible brand to purchase because it loses value far greater than its Toyota, Subaru, and Honda counterparts. Second, you will always get screwed when trading in a car. You are better off selling the car privately. Third, you should look at the overall price of a vehicle compared to your earnings. We will discuss this later. 

Let’s look at the depreciation data below….

Quoted from Forbes:

Source: https://www.forbes.com/sites/jimgorzelany/2019/11/07/burning-money-vehicles-that-depreciate-the-fastest-and-those-that-hold-onto-their-values-best/#72588c845f4a

Top 10 Vehicles Having the Lowest Five-Year Depreciation:

1.         Jeep Wrangler (off-road SUV): 30 percent

2.         Jeep Wrangler Unlimited (off-road SUV): 31.5 percent

3.         Toyota Tacoma (midsize pickup): 32.0 percent 

4.         Toyota Tundra (full-size pickup): 35.9 percent

5.         Toyota 4Runner (midsize truck-based SUV): 36.5 percent

6.         Porsche 911 (sports car): 37.2 percent

7.         Honda Ridgeline (midsize pickup): 38.1 percent

8.         Nissan GT-R (sports car): 39.4 percent

9.         Nissan Frontier (midsize pickup): 39.5 percent

10.       Subaru WRX (sports car): 40.0 percent

Top 10 Vehicles Having the Highest Five-Year Depreciation:

1.         Maserati Quattroporte (luxury car): 72.2 percent

2.         BMW 7 Series (luxury car): 71.3 percent

3.         Nissan Leaf (electric car): 71.0 percent

4.         BMW i3 (electric car): 70.9 percent

5.         BMW 5 Series (luxury car): 69.2 percent

6.         Acura RLX (luxury car): 69.2 percent

7.         Ford Fusion Energi (plug-in hybrid): 69.1 percent

8.         BMW 6 Series (luxury car): 69.0 percent

9.         Jaguar XJL (luxury car): 68.9 percent

10.       Chevrolet Volt (range-extending electric car): 68.1 percent

Now, as a savvy investor, there are other factors you need to consider in addition to depreciation data. Here is a simple list you should consider when purchasing a car, whether new or used. Most of the time, it’s better to buy an automobile slightly used but not always (depending on finance rates). 

1.) Purchase Price (always compare to KBB) Use link here to determine fair market value:  https://www.kbb.com

2.) Financing (Interest rate)

3.) Maintenance costs

4.) Depreciation Rate

5.) MPG

6.) Safety rating 

7.) Car insurance rate 

Let’s assume you are in the market for a commuter car. Highway/City driving. Let’s assume you are interested in a Toyota Camry, but you are leaning toward a new BMW 330i sedan. Let’s see the breakdown…

As you can see from the chart, the Toyota Camry is a way smarter choice. It is a safer, cheaper, more reliable car due to lower maintenance costs. It may not kick the Beamer’s ass with horsepower, but it does in almost every other category. 

The only category that the Beamer is better significantly than the Camry is the depreciation rate. It appears the three series BMW depreciates at 40 percent at five years compared to 49 percent at five years with the Camry. Does this category matter? Let’s do the math.

  • You would save $755 over five years on the Camry (just in maintenance costs) 
  • Plus another 16,280 off the sticker price. 
  • Plus another $1,856.25 in interest 

The Camry would have saved you approximately 19,000 dollars. As you can see from these calculations, the Camry is the best option. The 19,000 dollars properly managed could grow even larger if invested correctly. So does depreciation rate matter? It does, however, not exclusively.


Don’t “Keep up with the Jones”! Keep your emotions out of automobile purchases; don’t overpay for logos or names! Use the checklist above to see the actual expenses before making a purchase.  Try this approach before your next Big car purchase.  Research, research, research.  Never make an impulse buy.  Remember to Think Twice; before buying once! 

Let me know your thoughts? Subscribe and comment! Stay tuned for more posts!

Hinder Me, or Help Me? My Budget…

Hello and Welcome to The Dividend Dudes Blog,

Like I said in my previous blog post, to take control of your financial freedom, you must list all of your expenses, then categorize each expense into “Hinder or Help” me expenses and eliminate the shitty “Hinder me” expenses. In today’s society, people are overburdened with debt and costs, making them slaves to their jobs. This is a vicious cycle that keeps the honest working person, in my case, “dude” in the corporate world dealing with all the bureaucracy and bullshit. These entitled, egotistical bastards want to keep the “underdog” slaving away so the “top-dogs” can sit back on their lazy asses while reaping the benefits of the underdogs. (merit, top-tiered pay scales, etc.)  

Luckily for the dividend dudes and dudettes out there globally, most recognize that financial freedom is at our fingertips, but it seems so distant due to societal pressures. Sometimes financial freedom may seem as remote as Mars or Jupiter on a cloudy night. Hopefully, after deciphering this post and applying some of these principles, you can control your financial destiny too! 

Remember, “It doesn’t matter how much you make; all that matters is how much you spend.” Achieving financial freedom is quite simple: spend less than you make and invest the difference.

Using this categorical approach to your expenses will allow you to see which “hinder me” expenses are not necessary to your life existence and may be eliminated or deviated. By deviated, I mean to depart from the usual expense (i.e. decrease/cut).

I recommend categorizing your expenses as shown below in the chart. I would recommend getting an average amount (over one year) on fluctuating bills (groceries, personal care, etc.) due to increased accuracy. You know, the costs that change monthly. Most understand that bills fluctuate depending on your purchases. My grocery expense is roughly $400 monthly over the last year. Groceries, I define as “Help me” expenses in this post (as long as the grocery expense is reasonably as low as possible) because food contributes to your health and well-being. Simply put, you cannot survive without food.  

By calculating annual averages, it gives a more actual representation of the expense. However, If I purchased caviar and fine wines, the expense would skyrocket. At this point, with my monthly budgeting “financial awareness,” I would understand that my grocery expense suddenly became a “Hinder me” expense, thus not making the same mistake again! Let’s dig into my expenses before selling my home, “the ole money pit.” which should be enjoyable for everyone!! We will take a look at the average monthly cost in each category over the last year.  

“Hinder Me Expenses” 

The chart represents all of my expenses before selling my home. Every cost highlighted in red is a “hinder me” expense. The values highlighted in blue represent a “help me” expense. Some people may say, how is a mortgage payment a “hinder me” expense? Well, for a full breakdown, I can tell you to read my previous blog posts “the ole money pit,” but to quickly determine if this expense is a “hinder me” expense, just ask yourself a simple question… “Can I cut/decrease (deviate) that expense”? If your answer is yes, then it’s a “hinder me” expense. My answer to that rhetorical question about my mortgage payment is “Hell yes”!! 

I am a single man, for starters, so all I need is a one-bedroom apartment (which I can easily rent in my area for $850 per month, including internet and cable). I proved I can easily “deviate/decrease” that mortgage expense. Another expense highlighted “red” is HOA or homeowner’s association fee. I eliminated this ridiculous bill by moving into an apartment. GONE! Moreover, my truck payment could be decreased by choosing another mode of transportation (bus, uber, taxi, cheaper car, etc.)

Recap of “Hinder Me” Expenses:

To determine if an expense is a “Hinder me” expense, ask yourself two questions…If your answer (yes) to either; more than likely, it’s a hindrance expense.

1.) Can I live without it?

2.) Can I eliminate, deviate, or decrease this expense?

“Help Me Expenses” 

My “Help me” expenses are highlighted in blue in the chart above. My student loan is classified as a “help me” cost because it’s allowing me to be a high-income earner and supercharge my journey to financial freedom. If my student loan payment was being paid and I was in a different non-related field that didn’t pertain to my degree, this would obviously be a “hinder me” expense. For instance, if you received a Communications Degree from Timbuktu University (joke) and worked a minimum wage job at Lowe’s Home Improvement with student loan debt. Don’t forget, folks; college is a business. They don’t care if you find a job or not; these rogue scholars want your money. 

Other items highlighted blue are required for my lifestyle, and I cannot lower, for example, car insurance, groceries, water, internet, etc. One may argue that I could consider groceries a “hinder me” expense since I spent $400 on average per month. My rebuttal to this argument is I’m already super frugal and don’t spend lavishly on crab legs etc. Therefore, I know for a fact that my grocery bill is as low as reasonably possible.

If my average monthly expenditure on groceries is $400, then a monthly increase “spike” to $500-600 or say $800 in one month, the grocery expense would be skewed toward a “hinder me” expense because it’s not as low as reasonably possible. As discussed above, this would be a “red flag” in financial awareness. 

Recap of “Help Me” Expenses:

To determine if an expense is a “Help me” expense, ask yourself two questions…If you answer yes to both questions, then more than likely, it’s a “Help me” expense.

1.) Do I need this expense to make money, survive, maintain a modest healthy lifestyle, or for my well-being?

2.) Is this expense as low as reasonably possible?

I posted a simple algorithm to help you decide before making those purchases! 

Take a-ways:

· It doesn’t matter how much you make; it matters how much you spend and invest!

· Categorize each expense you have

· Before making a purchase…Determine if it will “Help or Hinder” you

· Your “Help me” expenses should be higher than your “Hinder me” expenses

· If it’s a “Hinder me” expense…You don’t need it!

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