An Australian father has warned young people against buying a brand new car, describing it as one of the worst financial decisions he has ever made.
Eric Ho Pham, from Reservoir in Melbourne’s north, claimed buying a new car was the “stupidest” decision he made, despite loving the car.
Mr Pham said he bought the ute after completing his apprenticeship and becoming a qualified electrician.
“When I was an electrical engineering student, I did almost all of my internship on a motorcycle,” Mr. Pham explains.
“I carried my tools on my back and tied it all to my bike in a funny way, and I kind of made it work.
‘As soon as I qualified and started making a lot of money, I thought I could now afford a car.’
Mr Pham explained that he went to a Mazda dealership and saw a shiny BT-50 in the car park.
Eric Ho Pham (pictured) claimed buying his Mazda BT-50 was the ‘stupidest’ decision he has ever made and warned young Australians not to get into debt by buying a new car
“Being naive and young and having never bought a car before in my life, I got sucked in by the slimy salesman and signed my life for this $70,000 car,” Mr. Pham said.
Mr Pham said taking out a loan to pay for the car did not concern him at the time as he believed he could afford the repayments on his new salary.
However, he said he soon discovered that being in debt meant he was completely dependent on his work.
“I was tied to work and then work stopped being fun,” Mr. Pham said.
“It was like I was on a hamster wheel trying to pay off this debt.”
Mr Pham, who now designs clothes through his company Cruzado, urged young drivers to save their money and be debt-free rather than buying a new car.
“If you’re young, just drive the cheapest, most reliable car you can afford and save money,” Mr Pham said.
‘It’s that simple. You don’t care what people think about what you drive, because at the end of the day they don’t.’
Social media users agreed with Mr Pham, with many claiming they were financially strapped by their car debt.
‘A lot of people need to hear this. I’m newly qualified myself, so I know the temptation. There’s nothing wrong with driving s**tboxes and being debt free,” one person said.
‘Car debts can weigh you down. Save, plan and buy smart to stay financially free,” a second added.
“I agree: We’re about to buy a brand new car, fifteen years into our marriage, and I’m panicking because I’m tied to my job to pay it off.” I’m seriously reconsidering,” said a third.
Mr Pham said he was “young and naive” and was sucked into buying the vehicle for $70,000 (pictured). He urged young Australians to become debt free by saving their money and driving an affordable car
According to Finder’s Consumer Sentiment Tracker, about 12 percent of Australians – around 2.5 million people – had a car loan in July 2024.
Australian Bureau of Statistics data showed total new vehicle lending reached $1.5 billion in July 2024, up from $1.3 billion the previous year.
Australian motorists set a new record for vehicle purchases in 2024, with 1,237,287 new vehicles delivered. This represents an increase of 1.7 percent compared to 2023, when a previous record of 1,216,780 new registrations was recorded.
BEST SELLING NEW VEHICLES IN 2024
1. Toyota RAV4: 58,718
2. Ford Ranger: 57,960
3. Toyota HiLux: 45,839
4. Mitsubishi Outlander: 27,613
5. Ford Everest: 26,494
6. Isuzu D-Max: 24,031
7. Toyota Corolla: 24,027
8. Mazda CX-5: 22,835
9. MG ZS: 22,629
10. Kia Sportage: 22,210
Source: Federal Chamber of Automotive Industry