Kevin and Sam recently wrote great pieces about the taboos around money and revealing how much you make.  They opened up a good discussion on why salaries are generally kept quiet and not revealed in daily conversation.  But what about how much you spent on a car? For many people a car is seen as a major income indicator.  Do the same taboos apply?

People can guess what you spent

One main difference between what you spend on a car and your salary is that people can actually see the car.  They can make an educated guess about what you paid whether you tell them or not.

Justified or not, people tend to make snap judgments based on the type of car you drive.  If you drive a high-end luxury car like a Porsche or a Mercedes assumptions are made that you have a lot of disposable income.  On the other hand, if you drive an old beater some people assume you can’t afford much more.

Of course they don’t really know whether you can afford what you drive or if you’re up to your eyeballs in debt.  But the reality is that many people see your car and assume things like how much you get paid and your financial worth.

What if people can’t guess, do you share the price anyway?

Sometimes what you spent is not so obvious.  Did you know that even some family cars like the GMC Acadia or an Acura MDX can run 40-50 grand? And any car can become expensive when you pick a high-end trim and load it with options.  Depending on how well you haggle and how much you load onto a car, you can pay up to 15 thousand more than some else.

Or maybe you have a sports car at home that you don’t drive to the office.  Do you tell your coworkers about it?  Do you want jealous colleagues that question how you spend your money? John and Jane have the same position, but why can Jane afford that fancy sports car?  Maybe Jane saved up her money and didn’t go out to dinner three times a week like John did, but the perception is that she must be paid more.

In all these cases, is it a mistake to advertise what you spent?

What if you overpaid?

Some people spend a ton of money on a high-end car because they think it’s a sign of status.  As crazy as it sounds, they’ll actually pay more for a car so they can brag about it.

Personally, I don’t care how much money I make, I’d be embarrassed to let people know I overpaid for a car I could’ve gotten cheaper.  If I decide to buy a luxury car some day, you can bet I’ll hammer that price down until I get the best possible deal, no matter what type of car.  By the way, if you are like me and worry about paying too much for a car, this TrueCar review explains how to determine what is a reasonable price for any car based on current market statistics.

What if you got a great deal?

On the flipside, what if you bought the same exact car as your friend but you paid $2000 less?  Would you share that information and make your friend feel bad?  Maybe they didn’t work as hard as you did to get a deal?  Or they didn’t wait for the best time to buy a car to time their purchase for the most savings.  It’s one thing to give advice and help a friend save money before a purchase, but it’s another thing entirely to rub their face in their mistakes after the fact.

The advantages of keeping car cost to yourself

As much as I’d prefer it not be the case, what you spend does affect perception.  People make judgments based on the kind of car you drive.  If you keep what you paid to yourself you can avoid unwanted speculation about your financial status.  It also helps you from looking like a fool that overpaid or allows you to spare your friends the same feeling if they overpaid themselves.

You may not guess it, but for me, car price is definitely a taboo subject, just like salary. Outside of my blog, I’m a bit secretive with money matters.  Online I want to help people save money and get deals so I’ll use facts to help relay concepts.  But in the real world, I’d prefer to keep my financials to myself.  I just don’t want to be judged based on my spending habits.  And in the end, if your car gets you from point A to point B, who cares what you drive?

What do you think, is it ok to talk about how much you paid for a car?  Is it taboo?  Or, since the price of a car is so easily found on the internet anyway, it doesn’t really matter?

Photo: A $500,000 Ferrari in the middle of China where per capita GDP is $3,800/year, 2011.  Sam.