You can have that opinion, obviously there are others who disagree. Debt assumes risk, having a paid-for $5,000 car in your driveway gives you indisputable security you don't have when $20,000 spread over 60 months' of payments (!!!) is sitting in your driveway. Five years is a long time to roll the dice that no matter what happens in your life -- job loss, medical issue, other unplanned financial emergencies -- you'll be able to feed this beast on top of paying for necessities like shelter, food, lights, and heat.Yes, of course. But I refuse to go through life worried about the worst case scenerio. Then one should never have a mortgage, because how can you pay for that burden if you have financial emergencies? Besides, worst case, if you lose your job and can't pay for the car, the repo man can have it. I've had $3,000 cars before, and now I've made the choice to have (and pay for) something much nicer. I agree with what MJ said. My parents are retired and could travel much more than they have been. And they love to travel. But they are so terified of the worst case that they hoard their money. You need to have balance in your life, and learn to say no sometimes, and reward yourself sometimes. I will never carry a balance on a credit card. I will never have a mortgage with a term longer than 15 years. And I will never spend money trageted for retirement. But I will buy an Infiniti G, I will blow ongodly money on a vacation, and I will buy Kraft Mac & Cheese instead of the store brand. There are no absolutes, we all have to do what works in our own personal situations.