Tag Archives: Kia

Save Money Ads – AND Helping You Spend the Savings

I’m very confused that there’s a large number of ads currently running that seem to teach people how to spend money. Does anyone really need help with that? Spend the savings seems to be the new trend in a lot of ads:

Lennox Air Conditioners have an ad promoting a 17 month no payment plan. That’s kind of cool, but the second half of the ad tells the guy he can now buy his bouncy castle with that saving. What saving? It’s deferred payments for 17 months – the air conditioning system he’s buying isn’t free all of a sudden! Pay for the bouncy castle now, then pay for the air conditioning system after. That’s MORE spending, not less. It’s over-spending, and not saving.

Kia is now running a national television campaign asking what would you do if you didn’t have car payments this summer. Would you spend it on a vacation? What? They’re delaying your seven or eight years of payments to not start until fall AND want you to spend the money you’re really not saving on a vacation. And newsflash: The ad states no payments. It does not state no interest, so the interest is still accumulating while you’re not making payments.

Scotiabank has been running the same type of ad campaign for a few years, too. The theme is generally that a couple goes into the branch to see how to save $1,500 a year. Then, the second half of the ad, has them spending it immediately. The ads are cute, but come on. You need a commission-based loans officer to show you how to save $125 a month? If so, you’ve got way bigger problems. I bet I can show you how to save $1,000 a month if you have vehicle payments. But, that aside, the savings, according to their ads, should then be spent immediately? How exactly does that help anyone?

The Vehicle You Drive May Match Your Credit Rating

One of my best friends has 10 years experience driving in Toronto. She’s absolutely convinced she can tell what kind of person is driving based on the type of car. For instance, she’ll never drive behind Chevy Cavaliers because she thinks they’re some of the worst drivers. Now that’s her very unscientific opinion, and yours might be different – assuming you ever gave that much thought.

But does the kind of car you drive have a connection to your credit rating? The credit bureau reporting agency Experian did a study that says yes. This study is really accurate because they took actual credit information and actual car owners. You may disagree, you may be exempt, but the averages are accurate. Now remember that the connection is only for those people who finance or lease. If you’ve paid cash there’s no loan payment on your credit report and the connection can’t be made.

Lexus: If you’re driving an RX350, your credit score is in the 775 range. Where 850 is perfect, that puts you in the top 10%. Makes sense, since the vehicle is very expensive and has super high payments.

Acura: Drivers of two Acura models (the MDX and RDX) make the list of top five credit ratings. These drivers average credit scores of 765 or so and average less than one percent default on their loans. What’s strange is that owners who leased don’t have good credit ratings for some reason – just those who financed.

The Subaru Forester and Outback complete the list of top five of highest credit rating drivers.

Leading the ‘really bad’ credit list of the bottom five is the Dodge Avenger. In the story from the Arizona Republic, the headline was: Driving a Dodge Avenger? Your bumper sticker might as well say: Bankruptcy filer on board. Some of the reasons are that the vehicle is very inexpensive and purchased by large numbers of subprime (bad credit score) customers. The average Avenger owner’s credit rating is 619 – a score that wouldn’t qualify for a line of credit or many decent credit card offers.

Two Kia models are on the bottom-five list: The Rio and Forte. Both are inexpensive and thus need a much smaller down payment. With average car loans over six years now, that matters to payment sensitive owners.

Rounding out the bottom five are the Chrysler 200 and Nissan Versa.

Remember that your credit rating is based on how much you finance, how high your payments are compared to the rest of what you owe on credit cards, loans, etc. Of course, the most critical factor is making your payment on time – every time. Those two things: On-time payments and your debt load make up two-thirds of your credit rating.