It became a fact of life if the 20th century, and for the foreseeable future, it’s the same today.
Our car is a part of who we are.
For those who are committed to the Dot Com lifestyle, that observation can be applicable in so many ways. The three we’ll consider right now are:
- Our vehicles as investments,
- Our vehicles as business expenses, and
- Our vehicles as choices we earned as a result of our success.
In each instance, one factor looms large:
Maintaining as much of a vehicle’s value as possible.
More often than not, that’s a never-ending battle, and you can thank the 19th century railroad companies for it.
They’re the ones who got the idea to maximize profits by devising an accounting maneuver that spread out capital expenditures over time. In so doing, the concept of depreciation for commodities came to be:
- They don’t necessarily wear out, but for one reason or another,
- They do lose value.
Thus, it’d be wise to factor that cost into your other considerations — length of ownership, monthly payments, etc — when purchasing a new vehicle.
AbsoluteReg.com recently did its own assessment of depreciation and its impact on the new vehicle market:
One of today’s ironies is electric cars depreciate quickly.
This is a function of technology moving so rapidly in that field that obsolescence always seems to be just around the corner. Thus, it’s a noble thing to do your bit for the environment, but like most other things in life, there is a trade-off.
One logical solution for melding conscience, commitment, and context is to lease. As with other vehicles, this calls for an educated calculation.
Actually, a real car depreciation calculator might be more productive.
The best decision is an informed decision. Depreciation can be managed.
Have at it.