Hey, quick riddle: if you throw a Subaru in reverse, what does that make you? 🤔
U R A BUS. We’ll let that marinate. 🚌🙃
Not interested in riding the bus? Shopping for a new car instead? 🚗 You’re not alone — but the way Americans are financing those rides is… wild. According to recent data, long car loans are now the norm, not the exception. Is that just smart budgeting, or a budget trap? Let’s break it down. 🤸
Here’s Five Fast Facts on how long it takes Americans to pay off cars:
- 🦭 Seal of Approval - Believe it or not, borrowing for cars got way easier last year. Auto loan rejection rates plummeted from 42% in February to about 15% by June — meaning more people could get loans. But easier access didn’t make buying a car cheaper — it just made payments stretch out.
- 📈 Stretch Armstrong - Lots of buyers are choosing longer loan terms to keep monthly payments smaller. Stretching things out works in the moment, but you’re locked into payments for years — and that can mean paying way more in interest over the life of the loan. Meanwhile, car prices are still high (so you’re financing more in the first place).
- 🚘 Boom, Roasted - By the generations, Millennials and Gen Xers (those aged ~30-61 years old) have the highest average auto loan balance (roughly $22,500). Gen Z comes in a bit lower ($20,000). And we won’t mention Boomers because they’re perfect angel babies - all paid off! 😜
- ⏳ The Long Game - And here’s the kicker: more than half of Gen X borrowers are in loans that run longer than 72 months (that’s six years or more!). Lots of Millennials are stretching past 80 months too. The idea is simple: smaller payments today. But smaller monthly bills can turn into long-term budget strain.
- 🤑 Ain’t That Grand? - For folks in our Facebook/Insta comments asking who’s paying seriously big monthly car bills — here’s your answer: nearly 1 in 10 Gen X borrowers pays $1,000 or more per month just for their car — putting transportation costs squarely in competition with rent or mortgage.
🔥Bottom line: No one’s forcing you to buy an expensive car — but loans have gotten crazy long, and that’s shaping budgets in ways most of us barely notice until payday rolls around. Everything’s expensive out there… except eggs for some reason (seriously, someone poll the chicken community). 🥚🐔 And hey — if you want to sound like the sharpest person at happy hour, look up what the “K-shaped economy” means and how that connects to your paycheck. It’s not just buzzwords — it’s the backdrop to this whole auto-loan story.
Close to paying your car off?
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