How Selling A Car Works

I later found out that the first pencil is arrived at by the dealership in a very unscientific way. For every $10,000 that is financed, the down payment they try to get is $3,000 and the monthly payment they try for is $250. In this way, a $20,000 family sedan would require about $6,000 down and a $500 a month payment. (These payments are based on very high interest rates calculated on five-year loans. These numbers are so inflated that a manager I later worked with laughingly called them, "stupid high numbers.")

Confessions Of A Car Salesman

Advice To A Friend Getting Started

As anyone in finance will tell you giving advice to friends and family is a double-edged sword. 

After the jump is an excerpt from a conversation I had with a friend in December. The advice is being posted here because the product explanations and basic portfolio allocation thoughts are relevant to almost anyone who is doing some investing for the first time. 

Some bullet points:

- ETF's are the way to go for the lion share of the novice investors portfolio. The concept can be difficult to grasp/explain for first-timers but is important. 

- "Buy low and sell high" is wrong. Companies making new highs present some of the best investment opportunities. 

- Invest in what you know. Your specialty, line of work, and personal experiences are an edge you bring to the market.


The indiviudal stock picks discussed since: