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What would you do? My sister and her husband are toying with the idea of a new car.
He just got a job where he will have a 40 minute freeway drive, and needs something reliable.
Currently they own a 2009 Saturn Aura and a 1997 Nissan Pathfinder. They owe about $8000 on the Saturn (bought used) and own the Nissan.
They want to trade in the Saturn and buy a brand new SUV for him to take to work, which would get about 5mpg more than the Saturn, but the payments would be $100-$150 more per month (a bit of a stretch for them right now).
She'd drive the Nissan.
I told them that instead they should think about keeping the Saturn, and when it's paid off, get rid of the Nissan and buy another SUV. Then she could drive a newer car sooner, and he'd get a brand new car in the end.
Her argument is that the Saturn was built by GM and may not last that long if he's driving it so much.
So, pay the Saturn off? Or cut bait, trade in the Saturn now, and buy a new SUV?
My Uncle still has a Saturn that he bought brand new 15+ years ago and it is still going strong.
Unless the vehicle is not maintained properly there is no reason to believe that the vehicle will not last just because it is going to be driven more and it is a GM product.
Probably not a good argument since there are still vehicles built by GM on the road and/or running from the time GM started building vehicles.
It appears your sister is looking for any justification to stretch their finances more than they should be and buy a new vehicle.
Doesnt make sense to me to get rid of a perfectly good car that you still owe $8K on to trade it in for a new suv that you will lose much in depreciation and end up paying a higher monthly payment..
Doesnt make sense to me to get rid of a perfectly good car that you still owe $8K on to trade it in for a new suv that you will lose much in depreciation and end up paying a higher monthly payment..
This.
Have they had any problems with the Saturn already? If they've been having lots of problems with it, I can see why they would want to get rid of it, but a 2009 model year car isn't that old and it shouldn't be giving them much trouble, even if it is built by GM.
Need more info here, it sounds like maybe they are just spooked by all the recalls going on for various vehicles and just want to get out before they possibly have to deal with that for their car. If the car has been relatively trouble free though, it doesn't make any financial sense to switch right now, especially if the higher payment is going to be a stretch for them. They can save that extra $100-$150 a month and in just 6 months they'd have an extra $900... enough to cover a fairly large repair bill.
The opinions above make a lot of sense. I have a question though that may influence my opinion; where does your sister now live?
The reason I ask this is because of the perceived need for an SUV, and my own family's experience (we're up in the rust belt, mostly flat well maintained highways) with someone commuting ~45 min on a highway each way each day. In my family's experience, the need for a reliable car was obvious, but secondary was the need for a fuel efficient car due to the driving distance.
Do the math and your sister can figure out pretty quickly how many miles they will be driving each year for the job, and how much gas they will need to purchase over the course of a year (and thus the cost of the gas can be calculated). A new SUV by it's nature will have worse fuel mileage than a new compact or sub-compact car and a lot more parts to repair as time goes on (more expensive maintenance). After our first car died at around ~310,000 miles (we had bought new years earlier), we got another one, brand new, compact one to replace it. Both handled the commute perfectly and the newer one is still going strong without major repair needs after 3 years even with high mileage per year. Both cars, small Mazdas.
Location: East of Seattle since 1992, 615' Elevation, Zone 8b - originally from SF Bay Area
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How many miles on the Pathfinder? A friend just sold his 1996 with 150,000 miles and no problems during that time, but it did suck up gas. Commute in the Saturn, and when paid off, time to think about replacing the Pathfinder. Maybe by then there will be a pay raise or two and the new payment will be more affordable. That additional cost of $100-150/month is not cost effective considering that the insurance will also be higher and you are only gaining 5 MPG gas savings on a 40 mile drive (actually a fairly short commute compared to many).
Personally, as this is family, I'd have stayed away from making any recommendations. In case something goes wrong, offense may be taken, and for long time. It's always good idea to play it safe and stay neutral.
Can't they ask question online for themselves and make their OWN decision? Cars are very personal and apparently there is financial consideration, so why burden yourself with this liability?
How many miles on the Pathfinder? A friend just sold his 1996 with 150,000 miles and no problems during that time, but it did suck up gas. Commute in the Saturn, and when paid off, time to think about replacing the Pathfinder. Maybe by then there will be a pay raise or two and the new payment will be more affordable. That additional cost of $100-150/month is not cost effective considering that the insurance will also be higher and you are only gaining 5 MPG gas savings on a 40 mile drive (actually a fairly short commute compared to many).
Insurance can actually be cheaper on a new car.....
Case in point:
2004 stripper work truck with 107K miles vs. 2013 new version of the same vehicle (same engine, body, color, options) and the insurance was $22 less on the brand new truck worth 4X more. Why?.....The new vehicle is safer, has more airbags etc and insurance company discounted the personal injury coverage more than the comp/collision went up due to the higher value.
What would you do? My sister and her husband are toying with the idea of a new car.
He just got a job where he will have a 40 minute freeway drive, and needs something reliable.
Currently they own a 2009 Saturn Aura and a 1997 Nissan Pathfinder. They owe about $8000 on the Saturn (bought used) and own the Nissan.
They want to trade in the Saturn and buy a brand new SUV for him to take to work, which would get about 5mpg more than the Saturn, but the payments would be $100-$150 more per month (a bit of a stretch for them right now).
She'd drive the Nissan.
I told them that instead they should think about keeping the Saturn, and when it's paid off, get rid of the Nissan and buy another SUV. Then she could drive a newer car sooner, and he'd get a brand new car in the end.
Her argument is that the Saturn was built by GM and may not last that long if he's driving it so much.
So, pay the Saturn off? Or cut bait, trade in the Saturn now, and buy a new SUV?
They should keep both cars.....drive the Nissan in the commute (pound miles on the older car). Skip the fantasy of buying a new SUV for commuting, that is ridiculous at 3.50+ a gallon for one person to ride in.
Case in point: Just had a buddy sell a 2500 pickup he used as a leisure vehicle. Put 112K miles on it in 10 years, the truck got 10-11 mpg with the 6.0 gas engine. Round numbers.....he burned 10K gallons of gas, at even $3 a gallon he spent $30,000 on fuel alone in a truck he bought new for $28,000. The fuel costs are becoming huge factors in the vehicle ownership equation. If you used this same math 30 years ago he would have spent $10,000 in fuel driving the same truck......10K/10 years is $83 a month (not terrible) but in today's money it is closer to $250 just in fuel!
What would you do? My sister and her husband are toying with the idea of a new car.
He just got a job where he will have a 40 minute freeway drive, and needs something reliable.
Currently they own a 2009 Saturn Aura and a 1997 Nissan Pathfinder. They owe about $8000 on the Saturn (bought used) and own the Nissan.
They want to trade in the Saturn and buy a brand new SUV for him to take to work, which would get about 5mpg more than the Saturn, but the payments would be $100-$150 more per month (a bit of a stretch for them right now).
She'd drive the Nissan.
I told them that instead they should think about keeping the Saturn, and when it's paid off, get rid of the Nissan and buy another SUV. Then she could drive a newer car sooner, and he'd get a brand new car in the end.
Her argument is that the Saturn was built by GM and may not last that long if he's driving it so much.
So, pay the Saturn off? Or cut bait, trade in the Saturn now, and buy a new SUV?
New does not necessarily equate to reliable. Just as some older vehicles - if well maintained - are extremely reliable.
To me, it sounds like he just wants a new car and using the commute as an excuse.
Personally, I would not buy a new car to make a daily 100 mile round trip drive - i'd leave that for one of my older cars. Putting 25K miles on a new car is a waste of money.
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