Even someonewith a relatively weak grasp on money matters will tell you that a car is not a solid financial investment. The car, unless it happens to be a Toyota Corolla or just about any Porsche, is sure to start depreciating as soon you exit the showroom doors.
Not only that, but it’s guaranteed to cost you yet more precious rands in upkeep. Certainly investing in property, retirement annuities or even the stock market will earn you a more appropriate and, hopefully, certain return on your initial capital outlay. The counter-argument is that as inhabitants of a developing country, with our own unique transport challenges, many people genuinely need to own cars.
Our public transport system has only recently begun to address the needs of the middle class commuter and, until such time as we can truly hang up our car keys and read the morning paper while travelling to the office, the car will continue to impose necessarily on our budgets.
What is one to do then when confronted by the inescapable need to engage in the daily grind, yet simultaneously make its fruits last? The answer is a great deal simpler and considerably less sacrificial than you might think. There is no need to reinvent your investment portfolio or to start cycling to work, although that is in many instances a more efficient alternative. Allow me to present you with the remarkably workable solution that is classic car ownership.
I’ll give you a moment to recover from the indignant disbelief. Now consider why some of the wealthiest people in the world, from showbiz types such as Jay Leno to industry tycoons such as Johann Rupert, spend millions on buying, restoring and maintaining hoards of old cars. Of course, these aren’t their only investments but I guarantee you that Mr Rupert derives more pleasure from his prize Austro Daimler Bergmeister than he does from the stock market.
Unlike almost any other asset, with the exception of property and jewellery, a classic car pays dividends immediately because you can use it. Not only that, but your investment is sure to increase in value in the future — a finite supply of old cars with an ever-increasing number of people who would like to own them equals ever-increasing demand.
I drive a 44-year-old MG to work almost every day and there is no logical reason why you cannot do the same. But what if it breaks down I hear you ask. Many old cars can be repaired easily and relatively cheaply and with an abundance of clubs, specialists and enthusiasts you are never far from advice and assistance.
It’s a way of life that may take a while to get used to for those accustomed to a maintenance or service plan — but just remember that those aren’t exactly free. If that doesn’t make financial sense, might I suggest a bicycle?