Pod Insights The Clark Howard Podcast 01.30.26 Best Cheap Cars / Secret To An Affordable Vacation About this episode Friday normally brings a ripe episode of Clark Stinks but today Clark has an update for potential car buyers. While the cost of automobiles has been soaring, Clark reveals a surprising counterpoint: a selection of reliable, more affordable vehicles. Also in the interest of affordability, travel can easily be too costly. But there’s an often overlooked option that could help you save on spring break or a summer getaway. (Note: Clark Stinks will be back next week!). Affordable Vehicles: Segment 1 Ask Clark: Segment 2 Affordable Vacations: Segment 3 Ask Clark: Segment 4 Mentioned on the show: qz: The 10 best cheap new cars, according to Consumer Reports Carscoops: Nobody Wants These 2024 Models And Dealers Are Drowning In Inventory Carvana sold its first used car in Atlanta. Now it’s selling new cars. How to Buy a New Car in 5 Steps Odometer Rollback Is On The Rise National Association of State Parks - Locate a Park Is Annual Travel Insurance Worth It? Travel Insurance Checklist: 5 Types of Coverage To Consider Clark.com - Invest & Retire / Retirement Calculator Clark.com resources: Episode transcripts Community. Clark.com / Ask Clark Clark.com daily money newsletter Consumer Action Center Free Helpline: 636-492-5275 Learn more about your ad choices: megaphone.fm/adchoices Learn more about your ad choices. Visit megaphone.fm/adchoices
Transcript 0:00 Speaker 00 At Edward Jones, we believe rich is about taking care of what gives your life meaning. That's why your financial advisor personalizes your plan to help you preserve your progress and create something that lasts. Let's find your rich. Edward Jones. Member SIPC. Welcome to the 50th Hunger Games.
0:17 Speaker 01 Witness the beginning of the revolution.
0:19 Speaker 02 Hey Mitch, you've been trying to take down these games from the start.
0:22 Speaker 01 Filmed for IMAX.
0:23 Speaker 02 Make them remember you.
0:26 Speaker 01 The Hunger Games: Sunrise on the Reaping, November 20th, rated PG-13.
0:35 Speaker 03 It's my pleasure to welcome you here to the Clark Howard Show, where our mission is to serve you with advice and information that empowers you so you make better financial decisions in your life. And it's Friday. That usually means we'd be having a Clark Stinks for you. But today, well, this is weird. Don't know this has ever happened in the 25 years or so. No, Clark Stinks goes back more than 25 years.
1:05 Speaker 04 No, I don't think it does.
1:06 Speaker 03 I thought it went back to the 90s. Anyway, that I can ever recall that we didn't have enough posts on Clark Stinks to do an episode of Clark Stinks today.
1:18 Speaker 04 It's more that I have a, just so many questions that I need to get through that I feel bad that we haven't gotten to. So I thought we'll just do-
1:26 Speaker 03 Oh, so we're doing an extra content?
1:28 Speaker 04 Yeah. Because if you think about it, if every single week out of three shows, one is Clark Stinks, like out of six segments, it's just, it becomes a lot. So, next week it'll be back, I promise. So I stink. It's Chris to stink.
1:39 Speaker 03 No, you don't stink.
1:40 Speaker 04 Yeah, I do.
1:42 Speaker 03 So, I'm going to talk about the way we buy cars is going through such a change. And I want you to know something positive.
1:56 Speaker 03 Positive about buying vehicles, including affordable ones you can get. Not kidding, that's coming up straight ahead. And later, I get complaints that I just, I love it so much that I talk too much about international travel. And so many people can't afford it. They may not be able to afford flying across the country. But I want to tell you about affordable vacations you can take that you may or may not have thought of or done in the past. And that's coming up later in this podcast. Okay, car business has been bad news bears for consumers for the last six years.
2:39 Speaker 03 Automakers have gotten addicted to only making and selling crazy expensive vehicles to the point that they have priced their product outside the reach of most Americans to be able to get a vehicle. But I want to give you a counterpoint to that. Consumer Reports did a neat matrix. They looked for very affordable vehicles that also are really good vehicles to own. And all the vehicles on their list started at a price that is going to surprise you because
3:19 Speaker 03 the average cost of a new vehicle in the United States is now $50,000 plus. But these 10 vehicles are 20,000 something. Yeah, I'm going to give them to you in the order that Consumer Reports rated them. So should I do this, the 10th best or the first best? I'll do it, I'll do it like they do in countdowns. The 10th best to buy, that you can buy for 20 something thousand dollars is the Subaru Crosstrek. Ninth, the Mazda 3. Eighth, the Nissan Kicks. Seventh, the Subaru Impreza. There are two Subarus on the list.
4:05 Speaker 03 Six, the Kia K4. I don't have any idea what a K4 is. Fifth, the Toyota Corolla hatchback. Fourth, the Chevy Trax. Third, the Hyundai Elantra. Second, the Hyundai Venu. V N U E. I don't know what that is either. I thought I knew cars. And then, the number one best on this affordable car list for new vehicles? Toyota Corolla. So, Corolla hits the list twice. With the hatchback in fifth place and the regular Corolla in first place.
4:48 Speaker 03 So, one thing in common with these, a lot of these are either small crossovers or traditional cars, passenger vehicles. The market in the United States so heavily has moved to SUVs. And automakers love them because the perceived value of an SUV is higher to a buyer. And then they jam on all those extra options on them and run the prices way up. And I mentioned back in December, there's also a deal that's an odd one on new vehicles. There are 2024 model vehicles that are stuck in inventory on a number of dealer lots.
5:34 Speaker 03 Here we are, model year 26. And there are 24s still sitting there unsold. And the manufacturers are gonna have to incentivize the dealers to move those on because they're not getting better with time. And the value of them is depreciating sitting on the lot. However, if you find one of these deals on a 2024, and it's not related to those 10 vehicles I talked about, it's just vehicles in general. If you buy a 24, it needs to be something you're gonna own a long time. Go with my 10-year rule. Because there's so much depreciation and value based on model year versus mileage.
6:17 Speaker 03 So, you'd only buy strategically, you'd buy a 24 model year that's still sitting there unloved. If it's one you can see yourself having in 2036, then you'll still be driving it. Couple other minor things I wanted to tell you. I just am so frustrated with what's called the grind. That's how so many new vehicle and used vehicle dealers still engage in the anti-consumer practices of the past where they try to get you hungry, stall you at a dealership, keep you there for hours, hope you get dehydrated along with being hungry, and before you know
6:59 Speaker 03 it, you have bought something you can't afford with payment terms that are terrible and all kinds of add-ons you didn't want and all the rest. And it's called the grind, the way they grind you down. And of all people who are starting to make a difference with new vehicle purchases, Carvana, Carvana, which does the thing where you can have the app on your phone and you can buy a used car right on your phone, they have been buying new car dealerships and experimenting with selling new cars cleanly to you like they do with used vehicles, where you know
7:40 Speaker 03 the price, there's no games, there's no gimmicks, you know the vehicle, the equipment, the color, everything, no games. And it is only by tradition that the car business stubbornly holds on to the old way of doing things. I thought mistakenly roughly 30 years ago when CarMax started, that CarMax was going to change the vehicle business. And they did for the people who buy from them, where you know the price on anything, there's no, there's no pressure, no games, it's a simple, clean process. But most dealerships still sell used cars the old-fashioned way, playing games, gimmicks,
8:25 Speaker 03 and selling you something, it could be junk, and the second you sign the paperwork, you own it, whatever problems it has. CarMax, Carvana have the thing where you can bring the vehicle back for a full refund within a period of time. Because used vehicles, they got histories and a lot of times they're not good. So the business is changing, just more gradually than I expected or would have hoped. Krista?
8:53 Speaker 04 Okay, David in Montana has a question for you. I recently read the below quote regarding used cars and the odometer. This appears to come from a good reliable source. What can a consumer do to protect themselves when buying a used car to ensure they are getting correct odometer readings? Thank you. And here's the quote, 2.45 million cars on US roads are likely to have rolled back odometers. That's a 14% rise year over year, more than double the typical annual growth. The reason used car competition is high and scammers are doing everything they can to artificially inflate values. And it's getting easier as more cars switch over to digital odometers. And this source is Carfax.
9:35 Speaker 03 So, uh, thank you. And I had read that Carfax report and I don't know why I never thought about talking about it. So I'm so glad that you submitted this, David, because the hope had been that when we went to digital odometers, that the problem with mileage rollbacks would end. But now criminals have figured out how apparently to manipulate the digital odometers. So if you follow my simple rule, and that is, is a condition of purchase of a used vehicle, you have it inspected by a mechanic of your choosing, then the mechanic's going to figure out there are signs it'll be clear in the vehicle.
10:20 Speaker 03 Somebody's being sold with 60,000 miles on it that maybe has 110,000 or whatever. A mechanic will know that. They'll be able to see various signs of wear and tear. Also, if you're buying a used car...
10:38 Speaker 03 From the brand of dealer that the car is. So let's say you're at a Honda dealer's used car lot buying a Honda, or you're at a Chevy dealer buying a used Chevy. They will have electronic service records that will clearly show what the actual mileage is pretty close on that vehicle. And that's how you can pierce what the actual or approximate real mileage is on a vehicle with a mechanic or with a records check.
11:11 Speaker 04 Jeremy in Arizona says Clark is convinced that the marketplace is going to force the sellers of electric vehicles to become more efficient to sell at a lower price now that they don't have the helping hand of the $7,500 tax credit. Why would this time be different than the early 20th century when the electric vehicles completely died off?
11:29 Speaker 03 What a great question, Jeremy. And it is very different this time because the companies making electric vehicles, look at them as like a computer. And an electric vehicle is like a computer with wheels. And the improvements in technology are so fast that outside the United States, the electric vehicle manufacturers update their models, I mean, a real update, not just changing the grille on the front or something like that, roughly every 20 months, where gas engine vehicles, because the changes in how internal combustion engines work, updates to those vehicles usually are on a four, five,
12:14 Speaker 03 or six-year cycle. So the electric vehicle market, if you think of it more like how cell phones steadily change over time, hopefully the functions get better, the size of the screens are growing, all that. You have to think of electric vehicles as like that. And one privilege I have by traveling the world is outside the United States. I see the vehicles being delivered and on the roads all over the place. And BYD, which is Build Your Dreams, I think is what BYD stands for. They are growing so fast, it's amazing.
12:56 Speaker 03 They were originally funded by Warren Buffett. And the vehicles that I've had the privilege to ride in many times is, you know, Rideshare, Uber kind of stuff. They're amazing and they're changing so fast. So you have the ability with technology for electric vehicles to steadily be getting cheaper and better, both at the same time, at a crazy fast rate. And that's why they're going to dominate the vehicle market in the world. And we're just going to be laggard on that because we put up barriers in the United States to the adoption of electric vehicles.
13:38 Speaker 04 Okay, and then David in Georgia says this. Clark, thanks so much for sharing the joy of living frugally. A funny thing happened on the way home from Christmas. My 2004 Toyota truck hit 400,000 miles.
13:50 Speaker 03 Wow.
13:50 Speaker 04 And it's still running like a top. Even the AC works. I bought this from a friend 10 years ago when it had 75,000 miles for only $3,500. If you're doing the math, that's a penny a mile or $30 a month. In addition, over 30 years ago, my generous dad sold 16-year-old me my very first car, a 1996 Mazda truck, for $2,000, which I drove for 300,000 miles in 13 years and then sold it for $1,450. I feel very grateful for such reliable and expensive vehicles and for my mother, Sue Gladson, who taught me how to be frugal, thrifty, and content with living simply.
14:30 Speaker 03 You know, also, I was just doing the math. And David, you drive a lot of miles every year and doing it so cheaply.
14:40 Speaker 03 And I just wonder, David, do you have mechanical ability that you have nursed these vehicles along for a long time? Or did you just buy twice very reliable used vehicles that gave you incredible years of mileage service? How great is that? And Krista, your vehicle now has hit 61,000 miles. You showed me the other day. And you're going to drive it till it has like 600,000 miles?
15:14 Speaker 04 However, long it will drive. It's turning six this year, so it's still a baby.
15:18 Speaker 03 Okay. See, so think about how few miles you drive a year versus how much David drives a year. Coming up ahead, speaking of driving, what about having an affordable vacation you can drive to? There's something that is so overlooked in a time that we really have to stretch every penny as a way for you to have a great, affordable vacation.
15:45 Speaker 00 At Edward Jones, we believe rich is more than caring about the latest and greatest. It's also taking care of what gives your life meaning. That's why your dedicated financial advisor meets you where you are with personalized financial strategies that help protect what matters so you can preserve your progress while creating a path forward. The key to being rich is knowing what counts. Let's find your rich together. Edward Jones. Member SIPC.
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17:59 Speaker 03 So I have a certain blind spot, and that's that I love travel, and I love to travel far away and experience new places all over the globe. It's just the way I'm wired. But I've been thinking, I hear so many people say now, because of the cycle of the economy we're in with inflation and the job market slowing and all the rest, that they can't afford to take vacations anymore. And I just hate that because it's so good to refresh and step away and have that time with others, family, friends, whatever.
18:40 Speaker 03 And I know that it's a bridge too far how expensive vacations can be. But there's something that's so overlooked, and it's the state park systems.
18:53 Speaker 03 That are so widespread around the country. State parks in many states by tradition, or even occasionally it'll be in a state constitution, that the state parks have to be affordable for everyday people. And in a lot of states, the state park systems will have a variety of lodging choices that are very affordable, from cottages to cabins to more like roadside motels of the old days. And so you just need a tank of gas, or if you're electric, you know, charge up your
19:32 Speaker 03 vehicle, and you go to nature of various types, depending on the topography where you live, it could be a state park, and a mountain, on water, whatever. This is a way, instead of doing a staycation, which does not recharge you. I mean, staycation is such a thing, but I don't think that it does the same thing for you as change of scenery, change of environment, breaking your routine and going to do something. So if your budget's really tight, this is a way you can do it. And I talked before about how there's an oversupply of oil and gasoline in the world,
20:15 Speaker 03 and we've been seeing gas prices go down. This is likely to continue. So that tank of gas you need to get there is likely to be very affordable. So if you're thinking about what you're going to do during the spring, for spring break, if you have kids, or whatever it is, and you think, well, this year, I'm not going anywhere, the state parks may be your ticket. Just a thought of something opposite of what I'm always talking about with travel and sightseeing and all that, but a very, very affordable way to do it. Krista?
20:58 Speaker 04 All right. Colton in Florida says, "My wife and I are planning a special trip for our 10-year anniversary in 2027. When we got married, we couldn't afford a good honeymoon, so this will be our first real vacation together." We're thinking about going to Jamaica, but we're flexible on timing if we can find a great deal. When's the best time to travel to Jamaica and start looking for deals? We live in North Florida. Thanks for your help. We couldn't plan a trip like this without your guidance.
21:24 Speaker 03 All right. First of all, congratulations to you, Colton, on your 10-year anniversary.
21:29 Speaker 04 Yes, happy anniversary.
21:29 Speaker 03 Congratulations that you're now in a position to be able to afford the honeymoon, essentially, you couldn't afford 10 years ago. And congratulations to you, living in North Florida, because pretty much anywhere in North Florida, except the extreme of the Panhandle, you're a short drive to Orlando. And the reason Orlando is significant, if you want to go to Jamaica, is the fares are hyper-competitive out of Orlando to Jamaica. A lot of very strong competition among discount airlines from there, and by discounter, I don't mean Frontier.
22:09 Speaker 04 [laughing]
22:10 Speaker 03 Oh, did I just read a crazy Frontier story? Anyway, as I recall, Southwest, JetBlue, both compete against each other on that route. And it's a hop, skip, and a jump for you from most of North Florida to go there. As for the bargain times a year for Jamaica, the Caribbean, fun in the sun, starting about the 20th of April is when the off-season prices for places you'd go come into effect. And also for airfare, airlines have a tougher time selling tickets outside of the peak season, which is from just before Christmas till late April.
22:52 Speaker 04 You don't want to go during hurricane season, right?
22:53 Speaker 03 Well, I mean, hurricane, how'd you know I was going to talk about hurricane season?
22:57 Speaker 04 Oh, no, I was just wondering.
22:58 Speaker 03 You don't need me. Go ahead, Chris.
23:01 Speaker 04 Oh, please. No, no.
23:02 Speaker 03 No, because you're right. So, the hazard that comes with the opportunity is, as Krista just said, is hurricane season. How do you deal with that? Well, it can be any time this year. The bargain time to go on a trip like this is when you get outside the hurricane season, which puts you into November and December. Now, here's the weird thing. For cruises, for going to the Caribbean, anything like that, running off to Jamaica for this 10-year anniversary.
23:38 Speaker 03 The first two weeks of December, right after you close out the Thanksgiving period, is the absolute bargain time of the year for leisure travel because it's betwixt and between. Nobody's really taken fun in the sun trips in early December. So if that would work for you, that gets you the benefit of the absolute lowest time of the year to go, and weather's going to be great, and you don't have to worry about hurricanes. And if you go in early November, let's say before Thanksgiving, same rules apply, low hurricane risk then. But December, you're outside of the season.
24:21 Speaker 04 Okay. Catherine in Montana says, "My question is about travel insurance. My husband and I take frequent road trips to Canada, which is close by. We buy travel insurance only for medical coverage and medical evacuation back to Montana while we're across the border. It's frustrating since travel insurance is packaged to cover costs for airfare trip packages, etc., and we have none of those. Our hotel reservations can be canceled without a charge within a day or two of travel, and we have no costs for flights, tours, etc. We want to reduce our cost for travel insurance by buying only what we need. We've used insuremytrip.com, but we can't filter out travel costs and just buy a medical policy. Any suggestions?"
25:01 Speaker 03 So there are a lot of sellers online that sell medical-only policies or medical-plus-evacuation for travelers. You can buy an annual policy for people who travel. You can buy one for a cycle of time, but if you're frequently, over the course of a year, crossing from Montana into Canada, it would really be great for you to buy an annual traveler's medical policy. And...
25:30 Speaker 03 I thought Ensure My Trip listed those, but if they don't, this is one you're probably safe doing a Google search, where you look for travel medical policy or medical travel policy or something like that. They are pretty widely available and not crazy expensive at all for these, because as long as you're not spending extremely long periods of time, these policies aren't designed for that. But instead, you're doing multiple trips over a year. That will be how you avoid the policies that whatever medical coverage they offer is part of the array of things offered in a broad travel policy that you don't need.
26:13 Speaker 04 Okay, and then hope I'm saying your name right. Tania, Tania, Tania in Maine says, "Some background on us. We're 49. My husband has a job in transportation construction in Maine, so the hours and stress are pretty extreme for him during the construction season. Our goal has always been for him to retire early by 55 in six years. Financially, we have a good $800,000 in retirement savings, between 401K, 401K Roth, Roth and IRAs."
26:40 Speaker 03 First, congratulations to you on doing that in your 40s. That's great.
26:45 Speaker 04 "For the first time in 2025, we were able to max out our contribution to retirement accounts, the 401K Roth and the traditional Roths for both of us.
26:53 Speaker 03 Wow.
26:53 Speaker 04 And we plan to keep maxing out if possible. I plan to keep working till 60 for the health benefits. My question is, how do people find reasonable health benefits when they retire early and don't have access through their employer? We need to make sure to account for this expense if we have to pay a lot for it, and I don't know where to start. 65 is the age for Medicare."
27:12 Speaker 03 Yeah, so again, I want to emphasize how great it is that you're setting yourself up financially by being max savers for retirement now and the money you've already accumulated. Awesome. The thing for people 50 and over, but not yet eligible for Medicare, is buying health coverage is a disaster right now.
27:37 Speaker 03 The Congress has not been able to come up with a system for comprehensive and affordable healthcare for people of any age, but the real weak spot is people that are too young for Medicare and at an age that the actuarial tables show you're expensive for insurers. We used to have a system that essentially held down the premiums for people that were in their 50s and early 60s. We don't have that anymore by the choice of Congress. So now the coverage for the age period you're talking about is out of sight. I mean, backbreaking
28:21 Speaker 03 premiums. But we're talking six years from now and the healthcare system in the United States, the cost of it, the insurance system for it, it's not working, obviously. And I am hopeful, always hopeful, that we will find our way to a better system for healthcare in the United States because this is not just about insurance. It's the whole picture we have to address. So for you right now, I can't give you an answer for six years from now or 11 years from now. I mean, 11 years from now, it's going to be, whatever it's going to be, is going to be completely different because you're talking about you'll
29:05 Speaker 03 work 11 more years. So I think you cannot know with certainty how that's going to work. You keep doing what you're doing over these years to keep accumulating wealth for your retirement future and hopefully over this time period between now and we're talking about the late 2030s, we will come up with a better system for healthcare and how we cover it in the United States than the never, never land we're kind of in right now. So that's the best I can say about it. But again, I'm so excited for the two of you, how determined
29:46 Speaker 03 you are to build out that financial independence so your husband can leave this very difficult work in six years in his mid 50s.
29:57 Speaker 03 And thank you so much for joining us today. I hope that in front of you, you have a wonderful weekend planned and know that all weekend long, we're there for you on social media, on YouTube, at Clark.com, Clarkdeals.com. And so we serve you every day of the year, every minute of the day, some way with our websites and the other ways that you can access information. It's all about you being empowered with knowledge so you can save more, spend less, and avoid getting ripped off, and we'll be at your service on Monday.
30:42 Speaker 00 At Edward Jones, we believe rich is more than caring about the latest and greatest. It's also taking care of what gives your life meaning. That's why your dedicated financial advisor meets you where you are with personalized financial strategies that help protect what matters so you can preserve your progress while creating a path forward. The key to being rich is knowing what counts. Let's find your rich together. Edward Jones. Member SIPC.
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