Comments on Saving to Inve$t: Your car - an asset or liability?

For me my car is an asset. The only liability is g...

2009-03-31T18:16:00.000-04:00

For me my car is an asset. The only liability is getting parts and fuel. I can always get back some of my money if I sell my car.

Since I love cars very much, I can say that my car...

2009-01-20T22:21:00.000-05:00

Since I love cars very much, I can say that my car is more of an asset than a liability. I mean I enjoy driving it, and it takes me to places. Plus I just love the way it drives.

I think my car is an asset for me. Expenses will b...

2008-10-29T21:28:00.000-04:00

I think my car is an asset for me. Expenses will be the liability. But when I put it in my car it will turn into asset. Like when I bought an auto part. Its a liability but when i install it then its an asset.

Agree with pfstock. Car = asset. Car loan = liabil...

2008-06-09T09:26:00.000-04:00

Agree with pfstock. Car = asset. Car loan = liability. Personally, I include the car and the loan (when I have one) in my net worth statement for two reasons:

First, it makes me feel the pain of depreciation, especially during the period (shortly after it is bought) that I'm underwater. I'd definitely say that this has affected my decision to buy used next time.

Second, when trading in a car, I have much more motivation to get at least what I have it for on my books, so as to not have to take the write-off and lower my net worth. If you don't treat it as an asset, you may treat it as worthless. That's how the dealer wants you thinking.

Thanks for the comment David. Sounds like your car...

2008-06-06T11:37:00.000-04:00

Thanks for the comment David. Sounds like your car has a high intangible value to you. However you need to weigh up all the running costs (lease, gas etc) and use hard facts to determine if it is an asset or liability on your personal net worth balance sheet.

pfstock - Great comment. I do have my car's in my networth but only the current blue book value - which declines every few months. It only takes a week or so to sell a car, so quite a liquid asset.

CPA's, can find a way to classify anything as an asset so as to claim depreciation! Like your comment on the CPA.

A car, in and of itself, is an asset regardless o...

2008-06-05T12:54:00.000-04:00

A car, in and of itself, is an asset regardless of how much you owe on it. (An exception is if the car is in such bad condition that you have to pay someone to haul it away.) However, a car loan is a liability, and the overall net might well be negative. In this case, selling for cash does not release one from the liability.

In any case, I don't include my cars as part of my net worth even though they have long been paid for. I also don't count "non-financial assets" such as stamp and coin collections, or jewelry as part of my net worth. The reality is that while these items do have value, I would not be willing to sell any of them, or I rely on them for income.

But, I do realize that there are people who count practically everything as an asset. I once heard a CPA try to explain something to the effect that even when you spend a bunch of money at the grocery store, there is no change in your net worth because the groceries are an asset equal to the cash you spent. The only change in net worth occurs when you actually eat the food. Leave it to an accountant to figure a way to audit your refrigerator...

A car's major benefits is allowing you to get from...

2008-06-02T11:26:00.000-04:00

A car's major benefits is allowing you to get from one place to another faster and more cheaply than other modes of transport. Also it gives you a lot of flexibility compared to public transport. So the intangible values/benefits make the car an asset for most people - espically car enthusiasts like me.