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I have not financed a car in 19 years. Most people do not finance a new car for 60 months. Lots of folks pay cash for used cars.
You are completely missing that this is "average". This article was not written about you specifically nor "lots of folks", it's about the average car buyer.
Again, depreciation is not money spent. If I buy a car for $20K and sell it five years later for $10K, my cost of buying the car is $2K per year.
Uh, that's exactly what they are calculating. You say that they shouldn't include depreciation (and you are wrong as that is certainly a cost) yet give an example of $2,000/year depreciation. Now add in the cost of fuel, service/repair, insurance, and taxes to get the total cost per year.
I paid off my car about 4 years ago. So, the monthly cost of ownership of my car now is:
1) $80 for insurance
2) $15 for car tags/inspections
3) $30 for gas (I use public transportation to work and use car mostly on weekends)
4) $50 for oil change/car repair (this is an estimate amount).
Monthly Cost: $175 per Month
Yearly Cost: $2,100 per Year
I have never been without a car since age 17. I can't imagine not having it for groceries, shopping, visit friends, etc. Bus can't take you to every corner of the city; but a car can.
There is no way the cost will go to $9,000 if you make the right car choices, say Honda or Toyota. Even with a car payment ($300) and more frequent use of the car ($80 for gas), the monthly payment would increase to $555 and yearly cost would be $6,660. But, eventually, the car would be paid off and the monthly payment would drop by $300.
I paid off my car about 4 years ago. So, the monthly cost of ownership of my car now is:
1) $80 for insurance
2) $15 for car tags/inspections
3) $30 for gas (I use public transportation to work and use car mostly on weekends)
4) $50 for oil change/car repair (this is an estimate amount).
Monthly Cost: $175 per Month
Yearly Cost: $2,100 per Year
I have never been without a car since age 17. I can't imagine not having it for groceries, shopping, visit friends, etc. Bus can't take you to every corner of the city; but a car can.
There is no way the cost will go to $9,000 if you make the right car choices, say Honda or Toyota. Even with a car payment ($300) and more frequent use of the car ($80 for gas), the monthly payment would increase to $555 and yearly cost would be $6,660. But, eventually, the car would be paid off and the monthly payment would drop by $300.
Please stop using logic with some of these folks. They want everyone to live in the urban core in stacked buildings, ride public transportation and think like them. They know what they know and nothing you or anyone else says changes their minds.
They are professional con artists and manipulators, truly the scum of the earth. And the law's always on their side so you're screwed.
They're con artists all right. But provided you do your research in advance, there's no reason to get taken.
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Once you sign that contract you're on the hook.
That's what a contract's about.
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May as well be signing your life away. Better pray you don't lose your job or get laid off because then the repo man comes to your house and takes your car back. And you lose everything you put into it.
Because the car is worth less than the outstanding loan balance, in most cases.
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Dealers love it because they got your down payment and the monthly payments you made, and they make money again after taking it back from you and reselling it. The more they turn it over the more they make.
Most dealers don't care; they don't get the car back, the finance company gets it back and sells it at auction. While the finance company is legally entitled to get the difference between the loan balance and the auction value back from the original debtor, without any security left it's unlikely they will, so they lose on the deal. And they have to pay the repo man.
There certainly is a class of dealers who sell crappy junk cars, often with rolled-back odometers (and possibly laundered titles, to remove salvage and flood designations) for inflated prices, finance them themselves at really high interest rates, then take them back at the slightest provocation. Don't deal with such businesses.
You are completely missing that this is "average". This article was not written about you specifically nor "lots of folks", it's about the average car buyer.
It's not written about an average car buyer. It's written about a typical new car buyer who will only keep the car 5 years. With the average age of the fleet being twice that, the actual average car buyer is certainly paying less.
Hm.
I am not sure what the point is.
I don't think that if you wrote an article about the true cost of having a kid or the true cost of owning a house or the true cost of washing your hair that it would be trying to make a negative point about doing those things.
Hm.
I am not sure what the point is.
I don't think that if you wrote an article about the true cost of having a kid or the true cost of owning a house or the true cost of washing your hair that it would be trying to make a negative point about doing those things.
Because this is the generally car-averse urban planning forum, and because the original poster made it a negative point.
I'm glad that you guys that don't own a car have the ability to have more pocket money and even are able to feel somewhat superior to those of us that do.
No, you can't borrow my truck. Guess you'll have to pay Fly By Night Moving to deliver that new piece of furniture.
It's too bad your Dr. appointment can only be scheduled when public transit isn't running a full schedule but I've got something I just can't get out of just to take you. Sorry.
What's with the inferiority complex? I don't think most people who don't own cars are wasting their time worrying about you. Most of us without cars factor in all the costs and yes, pay for delivery (we did when we had a car, too!) and given that most doctors don't have appointments at 2 am, that's not really a problem. You've heard of taxis, right? (although actually, right now we can walk to the doctor and the hospital, which is convenient.)
Obviously it's worth it for most people to own cars. But what's with all the antagonism towards looking at the costs? Again, this is based on the American Automobile Association's numbers. It's NOT some anti-car group. I don't understand why them providing a framework, and even fill-in-the-blanks to figure out your OWN personal numbers, is perceived as an insult.
If you own a car you've got to budget for it, right? If you DON'T own a car you have to budget for that, too, right? Sitting down and running the full numbers is useful and lets you figure out how you spend your money. That's not about being superior; it's about being fiscally responsible. If you're spending 2k or 9k or 15k on your car each year (or whatever number it is) you need to put that into your household budget. If you DON'T have a car you probably need to budget for some public transportation, perhaps some car rentals, maybe Zipcar or some taxis. And for those of us looking for housing, it's relevant when coming up with housing budget: we moved recently and had two working budgets to decide rent -- one was with car, one was without. Not having a car meant we could justify spending more on housing, if needed. It's all about priorities. We don't need a car for work, so it was a luxury, not a necessity. We don't currently own a car and so would have to buy one, and that's either a big chunk of cash right there, or an additional hefty monthly payment. And then it would be around $200/month to use it, and since we'd only be using it on weekends that is, at this point in time, not worth it to us. Obviously others make a different choice, but what's wrong with actually going into the decision fully aware of the various pros and cons and expenses? And at least if you have the numbers you can have an easier time figuring out your overall monthly household budget. And the AAA wasn't saying "these are the hard-and-fast numbers and this is what YOU will pay!)
In any case, we felt a huge relief when we got rid of our car. That doesn't mean we'll never get one in the future, but it would be a major financial decision. You think those of us without cars feel "superior," but how about the other way around? I could just as easily suggest that you feel superior because you have no financial worries and can clearly spend money without worrying about budget. It would be nice to be able to live life buying whatever you want without having to worry about bills. I don't have that luxury. (and I'm sure most car owners don't, either, which is why it's nice for them to be able to accurately forecast their own personal car costs so that they can plan their overall budget accordingly). If we were paying an extra $400 in our monthly budget I would FEEL it, and would have to cut back in other areas (personally, I'd rather travel than drive the car to run errands, and that money would have to come out of our travel budget. We are admittedly lucky that we have a non-necessity budget item, as others with lower incomes would have to take it out of more essential categories). Obviously some of you don't have those worries, and you should simply enjoy your life and your economic standing, rather than lash out at those of us watch our pennies.
Last edited by uptown_urbanist; 06-10-2012 at 10:24 AM..
Because this is the generally car-averse urban planning forum, and because the original poster made it a negative point.
Well, he's trying, anyway...
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