As late as last year, Toyota dealers almost couldn’t give the Prius Hybrid away. Incentives of up to $2,500 were offered to tempt buyers to take one home. Now, they’re all the rage, finish with 6 month waiting list and inflated pricing. So why the change? The short answer is when the price of a gallon of gas passed the $4.00 mark. This single event has breathed life into hybrid car sales and little cars in general, and is causing folks to spend cash in ways that just don’t add up.

Like Marci Solomon of Rochester, Washington, who remunerated $7,300 for a bottom-feeder 1996 Geo Metro on eBay not so long ago – regarding 5 times the car’s actual worth. She purchased to replace a Honda Element that was getting 28 mpg for the duration of her 100 mile commute to work. To save approximately $50 in gas per week she flushed over $5,800 down the toilet, just to feel good with regards to “saving” a little cash. She called it “a good investment.” I’d sure hate to see her 401k if this is a good investment. The point here is that emotions caused someone to make a very bad buy – if this cash was to be saved, she may very well have lost the probability for a secure retirement or the capacity to buy a home in the future, both very real future prospects or potentials taking into account the prospect cost of this cash as an investment.

Remember just a few years ago people were buying engineering stocks irrespective of the price or the financial underpinnings of the parent company. Investment “gurus” were heralding a new era of investment where stock basi principles didn’t matter anymore and stock prices were on a permanent upward trajectory – just trade to the next guy more than willing to give you a healthful profit. Look up “greater fools theory” on Google if you get the chance. As with most things that go up, stock prices tumbled rather quickly after the hot air behind the “new economy” ran out, taking more than a few secure retirement plans down with crashing portfolio values. Again, conclusions made by emotions rather than cold, hard facts proved disastrous and put galore retirees back to work as their investment incomes tumbled.

The moral of the story? As you angrily pump another $80 worth of gas into your current gas guzzler and swear you’re going to get “something smaller,” do yourself a favor first. Add up the TOTAL cost of car ownership before you buy anything. Make sure that at the end of the year, you’re spending less, not more for your car, and make your conclusions based on facts – not emotions.

Save Money With An Expensive Economy Car Think Again Photo

Save Money With An Expensive Economy Car Think Again Pic

Save Money With An Expensive Economy Car Think Again Image

Save Money With An Expensive Economy Car Think Again Picture

Save Money With An Expensive Economy Car Think Again Picture

Save Money With An Expensive Economy Car Think Again Pic