Whether it's an investment of time, love, or money, the Pony in the garage is something we have all invested in. But is the Mustang a solid financial investment? Does the Mustang suffer from the same financial up and down woes as the stock market? Does it stay fairly flat and true or is it, as a "market," on a steady increase in profit for the seller? Should you approach that steed in the garage as a way to fiscal freedom or simply as a place to invest some quality time and hobby money?
This month we investigate these questions and look at what good "investment" Mustangs are, what the growth (or stagnation) of several vintage and late model Mustangs have been over the last few years, and what some of the financial nags are out there. We'll also look at the different versions of investment, from owning several cars of value to how using your Mustang as a daily driver can be an investment in and of itself.
Let's Get Real-Retirement
One, two, or even three Mustangs won't make for much of a retirement-certainly not Aruba or Tahiti. Even high-dollar Mustangs bringing thousands of dollars per car will net you very little income. For instance, let's say you have a '65 GT350, a '69 Mach 1 428CJ Ram Air, and a 6411/42 convertible all tucked away. Here is the value of these three Mustangs according to the CPI guide:
|'65 GT350 Excellent condition ||$65,675 |
|'69 Mach 1 428 CJ Ram Air ||$31,050 |
|'64 1/2 Convertible || $20,550 |
|Total Profit ||$117,275 |
But what about restoration and initial purchase costs? At best, you can figure on paying $20,000 for the GT350, $10,000 for the Mach 1, and $5,000 for the convertible in fair condition (and these are very low estimates), needing restoration. You've immediately cut $35,000 off the top of your investment profits. Then there are the restoration costs which, when done correctly, can be staggering. A Shelby can still top out in the high teens (or more). The same can be said for the Mach and the convertible. Still, let's assume the best, and say your resto costs were minimal at $20,000 for the Shelby, $10,000 for the Mach 1, and $8,000 for the convertible. Below is what's left over. Even though there's still $40,257 in profit, you can see your cars are not the road to financial freedom. However, these three cars as part of a diversified portfolio would make some interesting pocket change.
|Total Profit ||$117,275 |
|Cost of cars: || |
|'65 GT350 ||$25,000 |
|'69 Mach 1 428 CJ Ram Air ||$10,000 |
|'64 1/2 Convertible ||$8,000 |
|Restoration cost: |
|'65 GT350 Excellent condition ||$20,000 |
|'69 Mach 1 428 CJ Ram Air ||$8,000 |
|'64 1/2 Convertible ||$6,000 |
|Total realized profit: ||$40,257 |
A Pro Speaks
We talked to an investment professional to get his take on what the average stock market investment can expect to yield. The stock market, over the last three years, has not been as strong as it was prior to that time. Still, the 100-year stock market average, according to our source, is still at a 10 percent return for investors, while government bonds, CDs and savings markets are returning 6 percent.
So from Mustang Monthly's point of view, the Mustang "market" could be a good place to invest some money-as long as you keep an eye on expenses. If you can make 10-15 percent profit, you are doing as well or better than the stock market. Keep in mind that we don't consider this a replacement for stocks, only a way to help improve your bottom line.