One personal finance blog I stumbled upon insists that most cars cannot be considered investments because:
- New cars lose more than 50% their resale value the moment you start driving them.
- Even if your car can be resold as an antique, you won't recover the maintenance costs.

It goes on to say that the only case in which a car can be considered an investment is if you need a car for your work, and even in that case, it is only a good investment if you buy a used car instead of a new one!

www.pfadvice.com/2007/05/09/your-car-is-not-an-investment-,

Other things it says are not investments include clothes, comics and collectibles, prestigious degrees, expensive glasses, cutting-edge computers, and jewelry. That if you spend money on these things, you are not investing.

I'm inclined to agree with him. What about you?

Prestigious degrees are an investments. The starting salary for a Stanford Business graduate is obviously higher than one who studied music in far away Indiana.

Other things it says are not investments include clothes, comics and collectibles, prestigious degrees, expensive glasses, cutting-edge computers, and jewelry.  That if you spend money on these things, you are not investing.

they are investments as any non consumable purchase can be considered an investment.however, not all investments yield desired returns/dividends.

i look at it more from the assets/liabilities view

if the use of any of them is capable of generating income, then they are assets.if their purchase/use leads to expenditure of income, they are liabilities.

some may say clothes are assets (business clothes) since a well dressed dummy is often more likely to get a job than a poorly dressed expert.

It goes on to say that the only case in which a car can be considered an investment is if you need a car for your work, and even in that case, it is only a good investment if you buy a used car instead of a new one!
this was discussed extensively in 'the millionaire next door'(great book)

an expensive computer is an asset if you use it for work.i do pp (engineering design)on the side, and if all my clients were straightforward ( more than once, when its time to pay up, big grammer commences) , i would have recovered the cost of my laptop by now. a high end computer can mean that
1)you deliver your work faster
2) you can utilize high hardware requirement apps that improve the quality of your work.

of course, if you buy a computer for gaming, its probably not an investment, as games will take up much of your productive time.

even worse, an internet connection may not be an investment if you stumble into websites like nairaland, which also assimilate your productive time.

OF COURSE UR CAR IS NOT AN INVESTMENT.COS OF MAINTENANCE AND OTHER SUNDRY EXPENSES THAT COME ALONG WITH IT.EVEN IN US I HEARD U PAY RATES ON EXPENSIVE CARS,PETS ETC.


WHEREAS ABROAD A HOUSE BECOMES A LIABILITY COS OF THE FEES PAID ON IT IN NAIJA ERE,IT A BIG INVESTMENT AS RATES TO BE PAID ON IT IS INCONSEQUENTIAL.

SO FROM A NAIJA POINT OF VIEW A CAR MAY COME UNDER INVESTMENT,SLIP INTO LIABILITY BACK TO INVESTMENT AND SO ON,

THINK FOR MORE UNDERSTANDING ON THIS READ RICH DAD POOR DAD.THOUGH I SOMETIMES FIND THE CONCEPTS THERE DIFFICULT TO ADAPT TO MY NIGERIAN NEEDS BUT ITS A EYE OPENER.CHEERS

Cars are definitely not investments, but there are exceptions to this rule.

I know of someone who got a contract worth millions, but lost it when the MD of the company sited him on a bike in town the day after.

It is common knowledge that in our society, the kind of car u ride can determine which doors open for you or not. In such circumstances, a car would be an investment and not a liability.

Second scenario. Has anyone bothered to find out how much Agofure, Iyare, Peace Mass Transit, IFEX Transport, ABC,  etc make from their vehicles on a daily basis?

If I spend 20,000 a month maintaining a car that gives ten times that figure in the same month, can the car be called a liability?

Remember that concepts were created by humans. We give names to situations. So in the scenarion I painted above, what would you say a car is?  

@ENOLASE , that can only happen inigeria

i work for a large investment bank and my manager cycles to work
na wa for naija

@enolase,

The transporters use buses, and not cars. I think seun meant cars for private use, and not commercial commuter/haulage vehicles.

@blacknbold
Your boss cycles to work because he wants to keep fit, thats actually a plus for him if his own manager spots him on one, that shows he is responsible and disciplined about his health.

For the guy on a bike, I believe it was an okada. This was a status thing and for the same reason even in US, if someone just signs a multi million dollar deal with your boss and he jumps into a wreck of a car your same boss that rides a cycle will wonder if he can fulfil the contract.

The place to start from is the term investment-what does he mean by investment? According to dictionary, investment is "the investing of money or capital in order to gain profitable returns, as interest, income, or appreciation in value". So what this means is that anything not directly correlated with generating income is termed investment. For a company a car will be an investment while in most cases for people, a car is not an investment but a depreciating asset. We have indirect investment, degrees, collectibles, etc. This cannot be classified under investment since I can not invest a degree and get returns. But I can use my degree to get more money.

The only investment in life is LIFE and other attributes makes life easy.The only material investment as at a seconds ago is Land and Properties, and we cannot talk about achieving our aims if there's no LIFE

Live this life on your own terms-thats what I believe. You will agree that the convinience derived in owning [and maintaining] a car far outweigh any reasons you might present [for me]. As our cities develop and exponentially increase in size, the space we need to cover becomes greater [not ignoring all the hype about connectivity/globalisation/communication et al].
If it serves the function for which it was procured, I have no problem and if you ask me a still an investment-why you may ask? TIME is the only currency for some of us and as such we place a high value on getting things done without any over-runs.
PS-Try surviving on the Government's Transport system in a city like Abuja and tell me what you think about it.

A car is not an asset, except its being used for commercial transport. If not for our bad public transportation, its always better to go without the liability (cost of buying, registration, insurance and all the other extras).

lol of course a car is no investment, it depreciates the moment you drive it

there's gotta be a fine line between business acumen and self-inflicted suffering. There's gotta be room in your life for some good times, if not you'll find yourself working to create wealth for others to enjoy. When people start going on guilt trips for buying items that make them feel good (like car, clothes, jewelry etc) they need to open their eyes and see that the famous proponents of such theories go on vacations almost every year to exotic locations, and generally have a good time. . .

so yeah, my car cost me money, and yes, i spend money maintaining it. but i sure as hell would be crazy to start thinking of it as a liability. hell, if your car keeps you out of the sun, then it keeps u in good health.

@TEXAZZPETE

YEAH I SHARE UR POINT.WHEN DO U START ENJOYING LIFE WHEN ALL YOU CALCULATE IS ASSETS LIABILITIES.INVEST.WHEN WILL U STOP INVESTING TO REAP FRUITS OF UR LABOUR.

OF COURSE U CAN DROP DEAD ANYTIME SO WHAT HAPPENS TO ALL THE WEALTH GARNERED,

INDULGE URSELF SOMETIMES AND ENJOY WHAT U HAVE WORKED FOR.

Simple definitions:

Asset: puts money in my pocket 
Liability: takes money from my pocket

So, my car is  . . . .

Ndipe:

Prestigious degrees are an investments. The starting salary for a Stanford Business graduate is obviously higher than one who studied music in far away Indiana.

Ndipe, so whats your point about Indiana? or do you mean India (d country)?  

Ofcourse, a music degree may not be lucrative, but you saying "Far away indiana" is contemptous!. Have you heard about the Jacob school of Music at the Indiana University, reputed as the second best in the country!.

http://en.wikipedia.org/wiki/Jacob_School_of_Music . Take a look at this Wiki link and read about Its US News & World report ranking about the school of music at Indiana Uni. I believe you know that US NEWS's ranking is respected for its accuracies.

Some people don't trust banks or investment businesses. So, instead of keeping their money in these strange businesses, they buy luxury cars and parked them. When ever they are broke, they just sell one of them.

Your can be an investment or a liability. You decide which one.


To:Seun
"Your car is not an investment" That's too generalized, you need to be specific in this kind of topics.

Thank God no one's talking bout Mobile phones!


For a unilag undergraduate, i don't think a car is a liability, it's a great asset In OSu, it's a requirement to get greater liabilissets (called Kokolets)

benjibabs:

Simple definitions:

Asset: puts money in my pocket
Liability: takes money from my pocket

So, my car is . . . .

in that case, your wife becomes a liability? Also, once you reach maturity, your parents and siblins translate to liabilities. Brilliant!

Money ain't everything. health, they say, is wealth. and you save your body incalculable wear and tear by running a car.

funny how many people dont realise that 98% of the wealth generated by these inspirational speakers come from the books they sell to y'all who they've convinced that they need help badly!

T2:
@blacknbold
For the guy on a bike, I believe it was an okada. This was a status thing and for the same reason even in US, if someone just signs a multi million dollar deal with your boss and he jumps into a wreck of a car your same boss that rides a cycle will wonder if he can fulfil the contract.

BS

"Your car is not an investment" That's too generalized, you need to be specific in this kind of topics.

It simply means your car. Not your uncle's car, not "someone's" car but yours. Yes, you!

@blackmamba

whats BS about that? For example someone goes to an interview with a worn out suit, another with a lovely cut suite. Which one strikes the best impression? Same as the car you drive.

in that case, your wife becomes a liability? Also, once you reach maturity, your parents and siblins translate to liabilities. Brilliant!

from a purely utilitarian one of the things your wife does is produce children.assuming you do everything right,(and are lucky to boot), your children will grow up to generate income of their own, some of which you will probably receive. so in purely financial terms, you may be able to describe your wife as a ' long term investment'

beleive it, in the most hard headed financial terms, some siblings are liabilities. 

Money ain't everything. health, they say, is wealth. and you save your body incalculable wear and tear by running a car.

matter of perspective.when i was in school, i wasn't mobile, and i had 0% body fat.(i was looking at an old pic (complete six pack)with nostalgia yesterday. i'm fatter now.a car is much more convenient , but you will put on weight because of it, and that is wear and tear.

What's all this obsession with money? If you feel your family members comprising of your wife, children, siblings, and parents are liabilities, then, do you really think you are better off, locked up alone wining and dining on roasted beef, without any company? What misery you would feel, because your thoughts were fixated on accruing money, at the expense of your loved ones.

As much as I am fairly knowledgeable with finances, I completely disagree with the idea of cars being a liability. If I was worth millions of dollars, I would treat myself to a nicer car, than what I am driving. I wont harbor the notion that 'cars are a liability' and as such, opt for an inexpensive car. That's the route that misers take. So, take it easy. Live simply, contentedly and quit obsessing over money.

My car is not an investment? Na wao! Says who?

My car is a very big investment. on my health, on my comfort and generally on my life.

Saves me atleast from being thrown away or run over by Okada drivers.

Abeg o me i disagree with this one. Even if na only the cool air and the pleasure of taking my wife around most evenings. And if i have the money, i will buy a better one. Everytime is not for investment. when you invest, you also enjoy the fruit of the investment. I won't spend my whole life investing and re-investing.

my car is an investment o. Chikena!

@wiseguy
u probably dont own a car cos if u did u'd identify with the poster.
ur car cannot be an asset because d cost of maintenance and fuel
could sometimes surpass ur personal spending in a month,
I'm talking from experience here.

Do you know there are some places you can't go if you don't have "big jeeps" or "sleek cars"?

Your typo car sometimes determine the kinda contract you get. Your car may be an investment depending on the way you look at it. Having a fleet of cars may not be an investment but having one good one is surely important.

@wiseguy
My motor dey helep me from entering one chance, e dey help me from sitting on iron seats, w1th my car, i fit carry 1 billion with confidence, all this na just to avoid inconvenience or one chance. Number 2, sometimes i dey use my car hire, and sometimes i dey use am loan. lol

@moondust

My brother I sure do own a car and I don't consider it a liability. Sure i do spend on fuel, maintenance and the rest but the benefit and comfort i get from the car far outweighs all these. For instance, i live in PH close to town and my company is based in Eleme. if you know the place too well, you'll understand the distance am talking about. if i should take a public transport, i will pay nothing less than N350 per day to and from work. That translates to N2,100 per week but i buy fuel of N2500 and I use it for close to two weeks. Now with my car, i don't have to go out so early in order to beat the husstle and bustle associated with public transport and i have my comfort. I also can easily branch somewhere on my way back from work without minding that Okada stops running by 7pm.

So, to me, my car is sure an investment.

10 thousand Naira a month for gas? That's not bad, especially, if you are making over 2 million Naira a year in Naija.

For those who regard their cars as liability, I have to ask again, of what purpose is your investments, if you can't reap the fruits of your labor? Finance 'experts' always allude to the wealth of millionaires by pointing out that their frugality is the essence of their wealth. Count me out of it! What is really the point in investing and investing, getting returns without spending it? If I can afford it, I will drive a nicer car. I wont have a million dollars in my account and drive a honda or or some other car, especially if I can afford it. In the long run, sometimes, older cars may cost you more money than buying a new one. Living thriftly, while saving up penny and penny, without reaping them eventually is not my kind of lifestyle.

The greatest investment is knowledge,alchemy.