He Set You Up
Tad is 17 years old and wants to buy a motorcycle for $7,500. He put a down payment on it for $2,500 already. He wants this toy now before he has any expenses. Should he go ahead with the purchase?
QUESTION: Tad in Indianapolis is 17 years old and wants to buy a motorcycle for $7,500. He put a down payment on it for $2,500 already. He wants this toy now before he has any expenses. Should he go ahead with the purchase?
ANSWER: Apparently, your stepdad has set you up—because you don’t listen to this show much or my information much—because he knew how I was going to answer this when you called. You’ve been painted into a corner, sir, but I’ll answer your question kindly.
As someone who teaches people how to become wealthy and how to keep their money under control, what I would beg you to do is if you’re going to buy a bike, buy a $2,500 bike and pay cash for it. Then you have no payments, you can pile up cash, you’ll be that much more ready to go to school, maybe even buy another toy, and let me tell you what’s weird. There are about six motorcycles sitting in my parking lot right now for people who work here. Some of those people make anywhere from good money to fabulous money. The weird thing is, it’s a pretty day in Tennessee today where I’m broadcasting from, and the guy who rode in on a $1,000 bike had as much fun as the guy riding in on the $10,000 bike. He really did. And when it’s raining, they’re equally as miserable.
It’s a toy, dude. Pay cash for toys if you want to be a rich man. If you want to be a poor man or a middle class man, always finance your toys and always have payments. Look around you. See who’s winning. Rich people don’t do this stuff. That’s how they got rich. They don’t give their money to banks. They pay cash for their toys. That way, they get to keep their money to do other things with.