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Ask Dave

Can't Get Through To You

JB is confused about selling a truck and getting a beater truck, since you would be paying on negative equity for something you aren't driving. Right?

QUESTION: JB doesn’t understand why Dave says to sell a truck when you have negative equity, because then you’d be paying a lot of money and only have a beater. He works in the construction business and has a $31,000 truck. When he presents his reasoning, Dave has some sad news … there’s one reason why he can’t help JB.

ANSWER: You’re not paying a bunch for the beater. You are paying a bunch for the stupidity of buying a car that you can’t afford. If you owe $31,000 on your truck, you could probably get $23,000 or so for it. Do you want to owe $7,000 or $8,000, or owe $31,000 on that truck? It cuts your debt by $20,000.

You are so truck poor it’s unbelievable. You’ve got a $560 truck payment every month. I can’t help you because you’ve got an answer for everything on why it’s smart to be $31,000 in debt while you’re broke. People who drive a new truck on a construction site were wealthy enough to write a check for the truck. Those who can’t write a check should drive a beater around the construction site.