Cars might be necessary for lots of people, but what isn’t necessary or smart is a car loan or a car lease. Just don’t do it. The car you can afford is the car you can pay cash for. Save up the money just like a car payment. Think you can afford $300 each month (plus higher insurance rates and higher registration fees)? Then start putting that amount away each month until you can afford a good, dependable, high-MPG vehicle. Between your savings and whatever you have for a trade in, that’s your car.
If you’re going to take out a loan, it should be for income-producing assets such as a rental property that will give you a monthly cash flow above the loan payment, taxes and expenses. Don’t take out loans for toys that will never hold their value.