To me this is a no-brainer, but this nice image (click to enlarge) really puts into perspective how much money people spend having a new car. And these dollar amounts don't even include long term costs associated with potential poor health or dear god, the environment. A simple car cost $50,000 over 5 years, that means I add $10,000 to my yearly salary. The over-compensator costs $150,000 over 5 years, that's $30,000 per year that I can just add to my yearly income. I don't claim to know much about economics, but this one is simple.