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Home > Time for a new, make that different, vehicle?
 

Time for a new, make that different, vehicle?

September 19th, 2012 at 09:59 am

I thinking about a new pickup. Something compact, like a Dakota, S-10, or Ranger. I'm not particular to makes.

This purchase wouldn't be until after December, when that one credit card that will shoot up to 23% APR is paid off. Then we'll be in the midst of winter heating, and post-Christmas financial trauma, so maybe not til next spring. We'll see.

I bought my current car from my aunt and uncle for a dollar last May. It runs OK. It's a 1997 Mazda 626. It has about 200K miles, so I can't ask for much from it. Of course we also have the family mini van that we recently paid off with adoption subsidy money. That's seven years old, and had 110K miles. It should last another 3-5 or more years, but we'll see.

So I started with the rule that I learned in the SA forums - monthly payment of no more than 10% of your monthly pay, financed for no more than 3 years. I cut the monthly payment in half, because it is possible that we would need to replace the mini van in that time frame. What I came up with is between 9 and 10K for a pick up.

A really quick look at KBB told me that I could buy a 2007 or so model with somewhere north of 120K miles. Not great, but a step up. And, having a pickup, especially in the country is nice.

So, I'm at least four months away from the purchase. Gives me time to possibly save some money, which will either get me a better pickup, or reduce my monthly payment. I can also spend that time becoming familiar with what's out there in my price range.

Yes, this does mean more debt. But, using the 10%, three year rule, I'm at least entering it with some reasonable restraints.

6 Responses to “Time for a new, make that different, vehicle?”

  1. snafu Says:

    I don't mean to sound snarky or rude but I've often wondered why guys who do not require a truck for work, or haul large/heavy items regularly chose to buy a truck since they are expensive to buy, operate & maintain. Insurance rates are higher than a car and with 4 children the cab would be crowded.

    What is the justification? Would you take on extra work to increase income, to overcome the added expense? What jobs could be done if you had a truck? Why not rent/borrow a truck for the day for a particular task?

    Are you having issues with the Mazda or minivan? Do you do the maintenance to keep your paid for vehicles running longer? Are you mostly concerned about the age or the mileage? What problems were identified by 'Lemon-Aid' or Consumers? I doubt either vehicle has monetary value so hope your choice of insurance reflects that reality. Are you saving the differential?

    Your post suggests you plan to substitute an existing debt [paid off soon] with a new debt for the truck. The real story at SA is to save for a replacement vehicle before the need is reached. You may not reach the target sum but you already know the best lender options.

  2. snafu Says:

    Earlier this month you wrote about retirement. You didn't outline your current retirement standings but I'm hoping you have been putting away something near 10%. In your dad's generation there was often a 'defined' retirement plan with the employer with holding about 7% of every dollar earned + contributions from employer. When SS was established , 10 yr family focus, and the majority of retirement sums swallowed with medical issues & support care during remaining years]

    If you are unable to cover your needs will you rely on your children to look after you?

    In Canada they have recently increased retirement age for benefits to 67 for anyone born after 1958. We're guessing that like Britain & Germany other countries will also increase benefit age

  3. snafu Says:

    sorry, mt MacBook is failing...

    When SS was established , 10 yr family focus, and the majority of retirement sums swallowed with medical issues & support care during remaining years]

  4. MonkeyMama Says:

    Yes, saving up cash for next car would be more the thing to do for long-term financial security. Agreed with Snafu. Just things to think about.

    I chime in just to get you to think about it some more. So much of what we do to get ourselves into debt is just about perceptions and cultural norms. So I think it's helpful to hear someone say, "Why would you do that!?! What's wrong with your current vehicle?" Think about what a financial difference it would make to put off this purchase for another year or two.

  5. PatientSaver Says:

    I wouldn't consider any of those vehicles you named to be "compact" at all. They are gas guzzlers, aren't they? That will just add to your costs.

  6. wowitsawonderfullife Says:

    Gotta add my two cents. We have an F150. Corporate car. A complete waste of money. It's $150 to fill. We use it perhaps twice a year for a run to the dump. Plus, I'm short and I can barely climb into it. Not good for kids! And it's only the most recent model (2011) that has any room in it. I would stick to a van only because there there is lots of room for the kids and you can take out the seats for loads of room if you need to move or do a run to the dump.

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