Answer: Zero

Questions:

• Do you agree or disagree with these research findings? Explain.
• What do you think are some of the reasons that people buy luxury cars? 
• How comfortable will you be spending $37,851 (average cost of new car) when you are ready to buy a new car? 

Click here for the ready-to-go slides for this Question of the Day that you can use in your classroom.

Behind the numbers (University of Michigan research study): 

“The assumption is a luxury car feels better when you drive it, and you feel better in it, but we had reason to suspect that the story is much more mixed,” said University of Michigan psychology professor Norbert Schwarz, who conducted the study with Peking University professor Jing Xu. “What we find is that as long as you pay attention to your car while driving it, it feels better and you feel better.”

How you feel depends largely on what you’re focusing on at any given moment, Schwarz said. When it comes to a car, though, you pay the most attention to it when it’s brand new or when it’s old and falling apart. In between, it’s all routine, and you might as well sit behind the wheel of a Toyota Corolla...“In statistical terms, the correlation [of positive feelings] with the Blue Book value of the car was zero."

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Last day to refer 3 colleagues and be entered into a drawing for a Macbook Air! 

About the Author

Tim Ranzetta

Tim's saving habits started at seven when a neighbor with a broken hip gave him a dog walking job. Her recovery, which took almost a year, resulted in Tim getting to know the bank tellers quite well (and accumulating a savings account balance of over $300!). His recent entrepreneurial adventures have included driving a shredding truck, analyzing executive compensation packages for Fortune 500 companies and helping families make better college financing decisions. After volunteering in 2010 to create and teach a personal finance program at Eastside College Prep in East Palo Alto, Tim saw firsthand the impact of an engaging and activity-based curriculum, which inspired him to start a new non-profit, Next Gen Personal Finance.