Americans spend too much money on their cars. This is because they finance the purchase.

When you finance, you borrow money to pay for something you could not otherwise afford. And a car depreciates over time, which means it is worth less and less as time passes. Very few cars appreciate in value; unless you are buying a classic sportscar you'll likely have a vehicle that loses value.

A car is conveyance, meant to get you from place to place. And pretty much all cars depreciate. It's not smart to pay interest on something that is worth less and less, you end up wasting money. Follow these rules instead to make a wise purchase the next time you need a car:

Don't finance. You are probably going to want more car than you can afford. At car dealerships, there is a loan officer there ready to help us get this car anyhow.

It's complicated and based in emotions. We have feelings about our cars. We love them, want nice ones, are proud of them. Loan companies manipulate us because of these feelings; they know we will accept unreasonable terms and rates to get what we want. You'd pay a lot less for the car if you bought it with cash instead.

Never lease a car. Leasing a car is like renting an apartment. You are paying to use something but not toward owning it. Plus, dealerships figure you won't take care of a car you aren't going to own so they add more cost to the lease to cover damage.

When you lease you have nothing at the end of your lease period to show for all of your money spent. It's very poor value.

Don't get a new car. A car that is new sells for a hefty premium just by virtue of not being preowned. This value - the * newness' * disappears the moment that you buy the car. It can never again be sold as new. This is why the car depreciates the very moment you drive it off the lot. You're losing value before you even get your new purchase home.