Keep you old clunker or buy new? (loans, status, interest)

[Grandpa Pipes]

Please see this thread..........

Keep your old clunker or buy a new car?

[Waterlily]

I've got two with no car payments. The one I drive is 5 years old now. It still looks good, and runs well. The other one is one of those Japanese made small trucks. It's 12 years old and still doing fine. I'm going to keep them both as long as possible. That'll save money on having a new car payment.

[GregW]

I buy used cars at least 5 years old with around 100k miles on them from private individuals. I have a trusted mechanic do a thorough inspection before I make an offer. I usually offer a bit less than the asking price. I pay cash for the vehicles.

I generally keep the cars for another 5 to 8 years until the rust dissolves the body work and/or frame and repairs could cost more then replacement with a newer car.

I currently own a '92 Buick Roadmaster station wagon that is one of the best vehicles I have ever owned. It has had its last major repair. I intend to replace it in about three more years with a desert car from the south west US. I expect to pay not more than 5 grand for the replacement.

My other car is a '96 Subaru Legacy Outback wagon. I paid 5k for it 5 years ago. I recently spent $1,500 to replace cylinder head gaskets before they failed. The car has over 175k on it and very little rust. I expect it to last another 5 years before being replaced with another Subaru. The all wheel drive system is very good on snow and icy roads. I expect I will have to pay around $5k for a replacement.

If I move to New Mexico I expect I’ll be buying the last cars I will need. Unsalted roads means the bodies last a LOT longer. There may be a ‘70’s GM pick up truck in my future.

Over all I have spent less on my cars than the interest on the loans I would need if I had been buying new or 3 year old just off lease vehicles. Obviously I do not buy cars for showing my status or importance. I buy transportation and some fun. I avoid the losses due to depreciation on a new car as well as interest payments and have much lower property and registration fees. Remember cars are an expense and not an investment.

So if you want to minimize your car costs well built clunkers are your friend.

[Omaha Rocks]

Never invest money in things that will do nothing but decrease in value.

Buying new vehicles is one of the single most financially wasteful and costly things people do. We're flat-out stupid that way.

I am absolutely dumbfounded by the number of clients I have talk to me about making $400 - $600 per month car payments (sometimes on more than one vehicle), and they absolutely cannot figure out why they're in trouble financially!

[GregW]

The explanation is simple; most folks cannot figure out the difference between what they want (learned from the advertizing industry) and what they need. They impoverish themselves to feel good, look good and feel safe. They never realize what they actually need is transportation and a positive bank balance.

Of course id everyone was as cheap as I the consumer economy would completely collapse. That might not be a bad thing if we went back to producing more then we consume.

[wheelsup]

If you do the math, buying a new car every 15 years is about the same as buying a used one every 4-5. Some people prefer to buy new so they know what they are getting and start off right with synthetic oil changes, tranny fluid flushes, etc. and can afford to pay cash upfront.

[GregW]

I tend to keep my clunkers for 10 or more years so the cost is always less than new. Besides coming up with 3 to 5 grand cash is a lot easier then finding 20 to 30 grand.