🚗 Being an Entrepreneur, is buying a Car an investment or liability?

[maventiger]

Personally, it depends on the purpose of acquiring the Car.
If it is business oriented I will agree it's an asset to your business.
If otherwise, a car will always be a liability.
What's your take?

 

[Ralphjoe]

Cars that are acquired for business purposes are not qualified to be called a liability, they are business assets while cars acquired for personal uses are what are called liability.

 

[maventiger]

@Ralphjoe what of cars that are being acquired for business purpose but couldn't live up this expectations and purpose of purchase. Is such an acquisition still an asset or a liability? I await your response.

 

[Abibatabosede]

If your business requires the use of automobile to enhance and facilitate your work,then a car is one of the asset for the business otherwise it is a liability. Some businesses like supply of wholesales of goods. In this case an automobile vehicle is needed.

 

[Shivay]

It depends that you are purchasing it for fun or for your business. A car in my opinion is not a liability, in todays world car has a very big role in everyone's life . For an entrepreneur it is definitely the worth.

 

[LaylaG]

A car is never and will never be an investment and if you are buying a car and thinking that you are investing in the car then obviously you are at a very wrong decision that might affect your capitals because a car depreciate over time but if you invest the money in land and housing that is the investment that appreciates over time.

 

[Adventurer]

Personally, it depends on the purpose of acquiring the Car.
If it is business oriented I will agree it's an asset to your business.
If otherwise, a car will always be a liability.
What's your take?

It's an investment in my business because sometimes I have to deliver lots of goods to customers and it won't be cost effective to take public transportation, infact in all businesses cars are an asset.

 

[Ifective]

It depends on what the car is for. If the car is a necessity. That is, if the car is meant to ease your daily outings mostly because of your business, then it is definitely an asset since it is used to run the business also.
But if the car serves as a luxury that is it isn't something you need, you just want it.

 

[kayode10]

It depends on what you want to use the car for. A car will be a liability if you buy it just to be cruising around the town.

It doesn't brings you money and you will need money to maintain its that's how it becomes a liability.

In a simple term, asset is something that put money into your pocket while liability takes the money out without any replacement.

With that simple definition, you should be able to determine if something is an asset or a liability.

 

[Ojonuyo]

Buying a car as an entrepreneur is a requirement to keep you and your business flourishing. This is because you need that car to transport your self and if possible the products you sell. Therefore I would say, buying a car as an entrepreneur is not a liability rather it is an investment.

 

[Alexandoy]

Well, having a car depends on the kind of business that you have. When you are selling expensive jewelry or signature bags that are for the middle class and the rich having a car would enhance your image as the business owner. You will surely get the respect that you are not out there to hustle the money of your customers because you look wealthy with a nice car. But when your business caters to the general consumers like retailing dried fish or snack foods then having a car is not that important for the business.

 

[Sotherefore]

The only advice I can say now is that do not buy a car when you are not using it for a business purpose or if you're not using it in a way that will generate some money for you because that will make you to run at lost because investing in car without any tangible reason for it is a wrong investment.

 

[Erik4150]

Buying a car can be both an investment and a liability. It all depends on what you are using the car for. If you are using the car for Uber by business, then the car becomes an asset. But if your car is an object that drains your money through buying of fuel everyday or cost of maintenance then I would call it a liability.

 

[maventiger]

@Alexandoy I agree with you on this. Most retailers and some wholesalers make such mistakes when starting out their businesses. They most times add a business car at the early stage of business planning which is not a necessity.

 

[Shayo]

By default, a car is a liability because it depreciates.
But as an entrepreneur who sees an opportunity in situations, a car will definitely be an asset. An entrepreneur sees an avenue to make profit, he can decide to rent it out and get proceeds from it or he could even decide to be the driver.

 

[Seun4luv]

“It's the single worst financial decision millennials will ever make.” That's because the moment you drive it off the lot, the vehicle starts to depreciate: Your car value typically decreases 20 to 30 percent by the end of the first year and, in five years, it can lose 60 percent or more of its initial value.

 

[MarieArie]

In most cases, buying an existing business is less risky than starting from scratch. When you buy a business, you take over an operation that's already generating cash flow and profits. You have an established customer base, reputation and employees who are familiar with all aspects of the business.

 

[Naina]

I advice to not buy a car because when you are not use in a business. Its all depends on you you should think that what are you using the car. With a simple difination you should be able to determines if something as assest a liability.

 

[Mcwally]

Personally, it depends on the purpose of acquiring the Car.
If it is business oriented I will agree it's an asset to your business.
If otherwise, a car will always be a liability.
What's your take?

Well buying car should not be a liability to the business provided it will enhance the business profitability because you need mobility for some business.it depends on the kind of business you may need car to move your product around

 

[WhiteHouse]

Yours like you rightly said, it depends on the purpose why you are buying the car. As an entrepreneur are you buying it as a tool to move your business forward maybe to run errands or deliver goods or it's just for pleasure and flex.