Dave Ramsey: A ‘Garage Sale Car’ Is the Best Cheap Car You Can Buy — Here’s Why
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How familiar are you with garage sale cars? No, we don’t mean finding a literal car for sale at a garage or estate sale. Rather, this is a phrase coined by money expert Dave Ramsey in an episode of The Ramsey Show to reference cheap cars you should buy on a budget.
If you’re looking for ways to save money buying a car, here’s what makes a garage sale car your best bet.
What’s a Garage Sale Car?
Simply put, a garage sale car is an ugly car. This car won’t turn heads at a stoplight or inspire envy from other drivers, but Ramsey said it is in great mechanical condition.
As far as the hypothetical driver’s persona goes, Ramsey said a garage sale car was likely driven 25 years ago by a little old lady who mostly drove back and forth to church.
“The car is old,” said Ramsey. “The seats are split, because they’ve been sitting in the garage. The paint is faded, and it’s a bad station wagon, but it’s in perfect condition mechanically, because it’s just been sitting there in [the] garage.”
Once the owner has passed and the car is up for sale, Ramsey said the buyer purchases it for around $500. This has less to do with its market value and more to do with this car having a lot of life left in it.
Speaking of life, the unspoken rule of owning a garage sale car is giving it a name. Think names like Old Blue or Big Red.
What To Look For in a Garage Sale Car
Car shoppers shouldn’t pick out a garage sale car seeking a cool vehicle. Instead, Ramsey recommends looking for cars where there’s mechanical reliability.
After you find your own version of this car, which might cost anywhere from $500 to $1,000, Ramsey said you’ll drive it for a while and start stockpiling cash reserves.
Drivers that put aside $500 every month for 10 months will be able to purchase a $5,000 car and pay for it in cash without worrying about taking on monthly car payments.
Ramsey, who owned and drove garage sale cars when he was struggling financially, said that while driving these cars “felt like forever” at times, the vehicles were blessings in disguise. He wasn’t borrowing money and was able to save up quickly to buy slightly better cars.
“I can afford cars now, because I used to drive the bondo buggy,” said Ramsey. “That put me in a position that I can afford it, and that’s what you do. You drive like no one else so then later you can drive like no one else.”
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