Continuing the deeper dive into the items on the USA Today News December 2025 American Dream article, I arrive at one of the most emotionally charged—and, in my opinion, one of the most financially dangerous aspirations on the list: owning a new car. It ranks third in lifetime costs, weighing in at a staggering $900,346.  Especially for the very young, a new car can represent far more than transportation. It can symbolize recognition, status, acceptance, and even identity.  

Patterns

I have seen two almost identical stories play out, and both make me wince because the pattern is so painfully predictable. A young man, right out of college, lands an excellent first job in a highly respected industry. Naturally, he wants something to show for it. Almost immediately, he feels the pull to buy a car that reflects his new success. He chooses a brand new Trans Am financed for six years. Then the hidden reality hits: for a 23-year-old male, the insurance on a high-powered car can feel like a second car payment. Before long, most of his take-home pay is going toward transportation. He is what we call “car poor”—not because he lacks income, but because he poured too much of it into a depreciating asset.

But let’s not just pick on the young. Frequently those who begin the financial journey with the “new car” mindset get hooked on this drug and can never give it up. Even now most of us can close our eyes and breathe in that famous new car smell. Back in my day the term “middle aged crazy” brought to mind a picture of a person—generally a male—aging, balding, slightly overweight, standing next to his fancy, new sports car in an effort to re-capture is youthful image. Ahh yes! This intoxicating dream must be handled properly to prevent it from wrecking personal finances.

The Real Need

Once we step back and remember that the real need is safe, reliable transportation, a good pre-owned vehicle often starts looking a whole lot better than a new one. To be fair, there are reasonable cases for buying new—warranty concerns, long-term ownership plans, or simply having the cash to do it wisely. But far too often, people stretch themselves not for practicality, but for image. Recent national averages help explain why this matters: the typical monthly payment is about $767 for a new car and $537 for a used car, with average loan amounts of $43,582 and $27,528 respectively. The average term for a new auto loan is nearly 69 months. Those numbers ought to make anybody stop and think, because they show how easily a car can devour cash flow that could otherwise build savings, reduce anxiety, or open doors for business opportunities in the future.

Consider the following suggestions for a sensible transportation strategy:
  1. Do not go into debt for the sake of image. Leasing or financing a vehicle just to look successful is an expensive illusion. Real progress comes from building true stability, not from borrowing money to fake it.
  2. Save up first whenever you can. Driving an older car for a year or two may not feel glamorous, but it can free up hundreds of dollars each month for an emergency fund, a future home, or some other long-term dream that matters far more.
  3. Let someone else take the early depreciation hit. A carefully chosen used car can still be attractive, dependable, and enjoyable to drive, without costing you thousands the moment it leaves the lot.

Simply stated, the practical principle here is delayed gratification. But let’s be very careful not to focus on the wrong word in this phrase. Thinking of the “delay” could potentially be a depressing thought that plays on the emotional immaturity lurking just beneath the surface in all of us. The most important word in that phrase is not “delayed”; it is “gratification.” The point is not to deny yourself enjoyment forever. The point is to have a long-term, satisfying experience with car ownership—whatever that looks like for the individual—instead of chasing a brief flash of admiration at the expense of future stability. Buying or leasing a luxury or sports car too early may feel thrilling in the moment, but it can undermine the very financial freedom that would make the experience truly enjoyable later.

Restraint

Cars do not last forever, and most of us will own many over the course of a lifetime. A gratifying experience with car ownership often begins with restraint, not indulgence. Like most other financial decisions, choosing a car wisely begins with asking some long-range questions: Where do I want to be ten or twenty years from now? Do I want to own assets that strengthen my financial position, or do I want to pour $700 to $1,000 a month into something that steadily loses value? Questions like these help separate genuine enjoyment from expensive self-deception.

Car enthusiasts often find ways to combine practical strategy with fun, beauty, and even a bit of status, and there is nothing inherently wrong with this plan. The wiser dream, however, is not simply to drive something impressive today, but to build the kind of financial life that lets you enjoy cars on your own terms over time. 

The real American Dream is not the appearance of success, but the freedom and stability that bring lasting fulfillment. In the final analysis, the most satisfying car decision is not one that makes a statement of accomplishment, but one that supports movement toward the life you truly want.

Read more of Gail’s article on Plaid or connect with her on her website.