Since a vehicle comes with such a huge price tag, and retains some semblance of value over the years, some people consider it an investment.
However, this is not the case. Despite the fact that your car or truck is still worth a lot of money, a vehicle is an asset with a rapidly depreciating value.
Are vehicles an investment? Or are they an asset?
Asset vs. Investment
The primary difference between these two is simple:
An investment will grow in value, but an asset will continue to lose value throughout it’s lifespan.
A vehicle starts to lose value as soon as you drive it away from the dealership. Yes it is true that some cars retain their value for much longer than others. In some rare cases a vintage or refurbished car can fetch more than it did when it was new.
But that is about as common as winning the lottery.
An investment yields long term dividends. Stocks, bonds, and property are common types of investments.
Cars and trucks, on the other hand, are assets. They do have value, and can be sold off or pawned to secure funding but they are NOT investments.
How to Get the Most out of Your Asset
Your vehicle is going to lose value over time, this is impossible to stop.
There are a lot of little ways you can maximize that value for as long as possible. Read this blog for some fast and easy tips!
Another way to get the most out of your car or truck is to use it as collateral to secure a title loan. Auto Title loans are issued based on the value of the vehicle. That doesn’t mean you are selling it, because you keep the car for the life of the loan!
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