QOTD: What Are You Supposed to Drive Making Minimum Wage?
After two years at a grocery store making $4.25, I got my first raise as a member of the U.S. workforce: I could eat all the nearly expired yogurt in the dairy I could ever want.
Unfortunately, yogurt doesn’t buy a car. And after two years of checking, stocking, bagging and mopping, I had a pair of turntables and records to show for my hard work.
Fortunately, I was in high school and could “work” off my car loan with grades. But for 3.3 million Americans who make the minimum wage — or less — there may not be such a deal.
And at $7.25 an hour, or $15,080 a year, your car-buying options are fairly limited.
I know what bootstrap Republicans will say: “Take the bus!” But remember, west of the Mississippi River, public transportation is often a time-consuming and inconvenient process. And if you’re making minimum wage, chances are you need more than one job, which means lost time commuting is lost money that’s sorely needed.
Geezers may scoff: “In my day, I worked for a dollar an hour and was thankful for the opportunity!” That’s true. In 1967, the minimum wage was $1 an hour, but a new Camaro also cost $2,466 MSRP — which meant your buck an hour could buy you a Camaro after one year of hard work. Try that today with your $15,080 and the 2016 Camaro starting at more than $26,000.
Budget buyers would say: “Craigslist is full of $500 Corollas! Buy one of those!” But remember that a bad asset is another word for a liability. Cars today are infinitely more complicated for home mechanics, and more expensive to fix at a shop. There’s nothing worse than a money pit, or worse, walking away from something you can’t recoup later. Even the average price for a used car is out-of-reach, the Detroit News reported that an average used car transaction is $18,800.
So what say you B&B? What’s a working man supposed to buy if minimum wage can’t even pay attention?
More by Aaron Cole
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Here are my thoughts. Some of us have given makes and models, and I can give a few. A 1990s Ford Escort, for example is a sound choice, as is an H-Body LeSabre. If you're going to buy something for not much money, what you do is you choose the best car that you can afford, regardless of brand. For a 20 year old car, the maintenance and condition matters a lot more than the make or model does. What a lot of people will do is finance. You can lease a Dodge Dart for around $100-150 per month, or you can finance a lot of car for that price. You can find a basic car, such as a 2000s Ford Taurus for $3000-4000. Even after the high interest rate, you could survive. Either pay cash and buy something really cheap, and make it keep working, or finance something that will work, but isn't glamorous (Old Taurus, Kia/Hyundai products, Impalas,...). But, you still have options.
Allow me to echo many statements by saying Craigslist is indeed full of >$1500 Honda's and other decent cars. It takes patience and research to come up with a good one. Might even need to budget for a head gasket replacement or even crazier, tires. I'll put it like this; if all you'll be able to come up with in the next year is the $1500 for the car itself, you may need to strongly consider how badly you need a car and what life would be like with $1500 tied up in a car that isn't working. We've got a '91 civic on the road for $900, but yes you have to be well connected to do it. It's been doing service as my cousin's car for a year, and he's the car grim reaper. Still runs fine though. Only time I ever made minimum wage was when I lived in rural Kansas, $5.15/hr then; you could rent a trailer in that town then for $75/mo, let alone a room in someone's house. I'm not saying it's glamorous, but it could be done.