When it comes to big purchases like a new car, even high earners can wrestle with whether they are spending too much. That was the case for Landon, a 27-year-old caller to “The Ramsey Show,” who recently bought a 2018 Mercedes S-Class for $35,000. Despite having a household income of $250,000 and a net worth of $750,000, Landon couldn’t shake the feeling that he had made a mistake.
Does Spending $35K on a Car Make Financial Sense?
Landon and his wife are in a strong financial position. They are in what Dave Ramsey refers to as “Baby Step 7,” meaning they have no debt, a paid-off home, and are focused on building wealth and giving generously. Despite that, Landon felt uneasy about sinking money into something that depreciates in value.
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Ramsey show co-hosts George Kamel and Ken Coleman reassured Landon that his purchase was well within reasonable spending limits. A common rule of thumb on “The Ramsey Show” is that the total value of a …
