As an auto enthusiast and former wholesaler I could talk for hours on the subject of used cars, but the best advice I can give you is here.

The next best advice I can give is as a rule don't buy GM after 2010, though before some of the car models make surprisingly good beaters hence the Buick (its an '07).

Transamerica

> major market shift

That really is the main unknown here. The used car market was pretty good prior to COVID, but disruptions in supply chain for new cars saw drastically reduced supply. So it's not that analysts were wrong, it's just that analysts didn't foresee the COVID pandemic and the global economic response that ensued.

As rates rise, parts become more available, and employment outlook gets more uncertain, people will buy fewer cars. That's just how demand works. So dealerships are going to be forced to either cut prices or sit on inventory.

> Hertz

With a rising market, there's a lot of demand to soak up that supply. When there isn't enough new stock coming in, people will buy what's available.

We're in a falling market, so if Carvana dumps a bunch of supply, it's absolutely going to shake things up. Dealerships would be able to buy cars at a steep discount, so they can afford to take losses on some of their inventory if they make profit from those liquidated cars. If your basis is 10% more than market value and you can buy cars at 20% under market value, you'll still make a profit if you sell at a 1:1 ratio, or break even if you sell 2:1 old vs new stock.

I'm only worried about dealerships if demand dries up before they can get through the old stock (e.g. unemployment jumps). As long as we continue this measured market correction where unemployment remains low, I think they'll be fine, they'll just make their money more from financing than sales price.

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Yes, in most cases owning a car is more efficient in the long run. The point is I don’t HAVE to spend even $100 if I don’t want to (the bus is $1 and I can walk to downtown for entertainment/shopping) I’m saving to buy a car in cash next year. The prices were too high this year and I would’ve ended up with a high month payment like OP. I don’t know enough about cars to take the risk of buying a cheap car privately (see this post)

I’d put it into Roth IRA and do half voo half vea.

How much do you owe vs what it’s worth. Car payments are the single greatest depreciating assets you can have. Get out of the payment as quick as you can and buy the bucket you can afford

You may find these links helpful:

• Retirement Accounts
• "How to handle $"

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I know, you have to drive in most cities in this country. I was originally responding to the comment about spending $800/month on Uber.

The downside of this method - popularly called 'market timing' - is that you can lock yourself out of gains if you get it wrong. The conventional wisdom is that "Time in the market beats timing the market."

Prior to my career in IT I was an automotive wholesaler, I could talk to you for hours about automotive valuations and auction data. I can also tell you in April of 2020 Manheim registered to my knowledge the only double digit average drop ever at 11%, which then rebounded and went three points over March 2020 by the end of May. If you had told me prior to 2020 this would happen I wouldn't believe you, because such a swing industry wide is stunning. I was still working part time in 2008 when the world fell apart, I don't recall we saw such monthly swings as an industry then but if we did it was the last time prior to April 2020.

In 2014 I argued on average the block as a whole was 30% higher than it should be, and every year after it rose causing the banks to predict a drop scheduled after 2017 when 2012-15 lease inventory would start to hit CPO remarketing. My absolute favorite part of this is Morgan Stanley was famously predicting an extreme bear case of -50% by 2021 :D

Then I was skeptical but like many I chat with in and outside of the industry we saw a +/- 10% decline coming which never came. Looking at the chart in the article the pricing was in the 125 range in 2017, in the link you provided the chart now is 202.6 in six years down from 230s or more than 100% higher in a short time. Before the world blew up the second time this century, it looks to have been around 140 which was already higher than the predicted bull case by 15 points. Now that dealers are all sitting on inventory in the 200-230 range period (depending on when acquired since 2021), you think there will be a 60 point drop which would literally bankrupt most of the used industry who would then be 30%+ negative on their inventory sunk costs? I'd like everything to return to the mean as well because none of the valuations since March 2020 of anything are real but I don't see it happening. Just like we didn't see any drop as predicted in 2017, dealers will employ the same wholesale and retail tactics to keep the used market stable.

On Carvana et al this is the only major variable I see and perhaps the implosion of the VC used car companies may trigger something unexpected, but Hertz started dumping its inventory into a rising market and didn't trigger a pullback at all. I asked around a little when Hertz was going on, the liquidation company purposely was not releasing inventory as it sold as you would think but only in small chunks and held back everything else until those chunks cleared. If Carvana went Ch 7 I would expect more of the same, in my view something unexpected and uncontrolled would have to happen to trigger a major market shift in the short to mid term.

If they are moving out of country in six months, she can have a $5000 car or even less and have little to no car payment. I mean she really just needs it for social activities, right?

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Well, my first question is in regards to your rent, but that's probably fixed by a lease/mortgage so there probably isn't anything you can do about that now.

You originally state that your car payment is $476 and over pay to $550, but you make it sound like it is actually $550 in the breakdown. If your car payment is only $476 every month, then only pay that.

$123 for internet seems excessive. Have you looked for cheaper service?

$200 for shopping that isn't groceries needs to stop.

$200 for eating out needs to be eliminated too.

There isn't $50 for coffee and $30 for extravagant haircuts in your budget (if there were then you wouldn't be asking for budget advice).

Get rid of date night & cut your own hair

Stop eating out get rid of your subscriptions & get rid of that car payment get a cheap car in cash

Just for the record, Pittsburgh and the surrounding suburbs don't have anything like the DC metro.

Around Pittsburgh, unless you live in the city and don't care about traveling beyond city limits, you're driving.

Higher returns come with higher risks. Do you really understand the risks? Also short-term capital gains (realized within 1 year) are taxed higher than long-term gains in the US.

Why did you get such an expensive car payment? Why not sell the car and downscale. You could get something like a used nissan leaf with like 50 miles of range for a few thousand dollars. Very low maintenance, low insurance payments--35 dollars.

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It’s the Elon Musk method of investing

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No. It's not worth considering. The point of my rhetorical question is that if it was so easy, everyone would do it. Of course it's easy to look back and see the low and high points but in the moment is the hard part.