Car Payment Justification

Buy new with cash, keep for 10-12 years, repeat.

Used vehicles are hit and miss and leasing/financing is just paying someone to borrow money on a depreciating item.
This.

We are about to replace my wife's 23 year old Nissan Maxima (which we bought brand new) even though it only has 65k miles, with a new vehicle.

A 23 year old car does not have the safety and convenience features that a new one has. I think my wife is worth it.....
 
This.

We are about to replace my wife's 23 year old Nissan Maxima (which we bought brand new) even though it only has 65k miles, with a new vehicle.

A 23 year old car does not have the safety and convenience features that a new one has. I think my wife is worth it.....
Why wasn't she worth it at 10, 15, or 20 years?
 
I want to know where you guys are finding $1500 beaters that can be easily put on the road. I've been looking for a decent car for my niece and 4k is about rock bottom for anything that doesn't need at least 2k worth of work before its reliable.

She finally found a family member selling one for 3k which was about a grand under blue book retail.
 
$400 lease + insurance +yearly registration. No thanks.

I have three vehicles, cost for insurance + registration is right at $175/month for all three combined. I'll keep the difference, even in Canuck bucks $225/month buys plenty of repairs, and a hell of a lot more repairs since I'll do most of it myself.
 
There isn't much for beaters anymore. My beater costs me 2k and it's paid back but has a rusted frame that I have to fix to keep driving it.

What Fenceguy said though, mostly can I afford it and do I want it. Otherwise it very seldom makes "sense".
 
I think you guys are missing part of it at least from what I've been able to understand so far. You guys keep talking about buying new vs used vehicles and Poke was talking about leasing new vs buying used vehicles. I think there is a pretty big difference there when it comes to payments and what you get out of it at the end.

Kevin
 
you can always sell the car ...

Anyone banking on sale value of a vehicle looking at current pricing needs to rethink. Chances are more likely that you would need to liquidate a car because the entire economy has taken a drop. During recession times, or depression if you think we may be headed that way, you will be trying to sell a car at the same time many others are trying to do the same. Used prices will drop like a rock. A car you can easily offload today may be teh car that never seems to sell when you need/want it to. And that goes triple for those buying top of the line vehicle banking on just selling it if they need to do so.

When the economy tanks, not many will have the cash to purchase your vehicle. Better to assume sunk cost in your evaluation and if you hit that time to sell, any money gained is a bonus.
 
Why wasn't she worth it at 10, 15, or 20 years?
You missed the 65k miles on a top of the line 23 year old car part, that is in near mint condition.

Plus, I just sold a house for $725k that I paid $232K for in California , and I just bought a brand new $589k house in Georgia....cash.

So, I'm flush in cash right now...:flipoff2:
 
I think you guys are missing part of it at least from what I've been able to understand so far. You guys keep talking about buying new vs used vehicles and Poke was talking about leasing new vs buying used vehicles. I think there is a pretty big difference there when it comes to payments and what you get out of it at the end.

Kevin

This. Everyone's financial habits impact the right choice. Look a your normal ownership pattern to make that decision. If you are that guy that needs the newest/bling every couple years, it matters to you, a lease may be to your advantage. If you tend to drive something until it dies, a lease may not be to your advantage.


Let me just say... Thank You to all you dopes who need new vehicles every couple years. It is your involvement in the car industry that keeps a sufficient supply of lower mileage decent used vehicles available for the rest of us. We couldnt do it without you. And let me encourage you to step up to turning over new cars on a yearly basis. We are all in this together.
 
Never financed any of my own cars, hell I've never paid more then $1800 for one. Does suck not really being able to work on much anymore, but even with paying for my own repairs on stuff I'm wayyyyy ahead of where I'd be with a payment. It's not just the payment that's so bad, it's the increased insurance on top of it. Last time I looked at something I could afford to finance it would have cost me more than my fucking rent after the payment+insurance. Fuck that.
 
More people need to just admit that its because they want it.... thats why i have my new pos bronco coming. It makes no financial sence at all and i dont even know how often im going to drive it, probably on an occasional weekend to go get a rockstar and doughnut or on the 3-5 camping trips a year we go on. I could probably spend 10x less on a 90s bronco that would do all the same shit... but nope.
^this

Running numbers on a new car payment doesn't work unless you're using it for business. If you want it and can easily afford it, go for it. If you trying to fit a car payment in a tight budget, don't go for it. If you can fix stuff yourself, driving older cars wins out over payment every time. I have a newer $45k truck I drive about 6k miles a year, it doesn't make financial sense but I can afford it and I like it so I bought it.
 
I don't have much time now and I'd rather not rush a response here. Perhaps tomorrow I will get into the file next to me and give you some real numbers, examples, and my reasoning. It is going to come down to a mix of numbers, my personal experience, and opinions on the matter. I have bought, leased, financed, and even sold cars at a chevy dealer for a living. I bought my first house selling a mix of new and used cars for the man. I am not the most experienced or smartest but I have an idea what I am talking about.
 
More people need to just admit that its because they want it.... thats why i have my new pos bronco coming. It makes no financial sence at all and i dont even know how often im going to drive it, probably on an occasional weekend to go get a rockstar and doughnut or on the 3-5 camping trips a year we go on. I could probably spend 10x less on a 90s bronco that would do all the same shit... but nope.
:laughing: Agreed. Bought my JL for the same reason and to plan a summer trip last year. I’ve taken it wheeling once since then. It sits in the garage all of the time unless it’s the weekly outing to the mall. I’m planning to really sell it but haven’t had a chance to get the doors and top back on for some good pictures. :homer:
 
how important is comfort and how you look from the outside to you?

because i got tired of bouncing my kidneys with no AC while being mistaken for a tweaker.

:homer:
 
I would sincerely like to better understand Poke's thoughts around the lease stuff... I don't currently follow it.
I'm pretty sure the way Poke was trying to paint his logic is this:

suppose he leased a 2018 Ford Raptor. Let's assume his monthly lease payment was $600 (no clue what it would be and would depend on various factors). Now, suppose his LEV (lease end value) is $55k. High MSRP was about $65k in '18. His lease is up in Jun of '21. He is talking about going and looking for a new vehicle now. He could take his Raptor and trade it in. Currently a fully loaded '18 Raptor in Very Good Condition with 45k miles has a trade-in value of $60-64k.(according to KBB) So if he were to trade it in NOW, and get $64k for it, he would get approx $8k down on the next vehicle "for free" according to his logic. The new finance deal would pay off the lease for $55k + $600 for May's payment.....leaving him with around $8400 being applied to his current new deal.

I believe this is his how his numbers work. Now, he did originally say a span of up to $15k "made" on the vehicle....but that would obviously depend on the vehicle and is pure speculation.

Anyway, I hope that helps. That is how I took his post. I don't agree with it at all however. He is claiming that he would've paid $approx $366.67/month for the lease (when you take into account the $8400 he "made" on it over the 3 years) and that the $366.67 net payment is less than a base price F150 payment...and therefore he was able to drive a fully loaded, nice vehicle for less then a base model.
 
I want to know where you guys are finding $1500 beaters that can be easily put on the road. I've been looking for a decent car for my niece and 4k is about rock bottom for anything that doesn't need at least 2k worth of work before its reliable.

She finally found a family member selling one for 3k which was about a grand under blue book retail.
Military bases. Guys move through cars when they deploy/transfer. If you live close to a base and have a buddy who can access said base, many bases have "lemon lots" where people just leave their cars and contact info. After a certain amount of time, they get towed to the scrapyard.
 
A used low mileage truck ins't necessarily a better deal than a new truck, given what the used market is going for.
The idea that a Used truck is significantly less is a notion that ties back to the 70's and hasn't been the case in decades.
I found this out when I went shopping for a new truck a few years back.

35-40K for a 2 year old truck with 40K miles and unknown history?:lmao:

Went with yet another brand new truck and did the same as I did with the previous two, large down payment and $600mo for 3yrs.

I bought an 88 Chevy Z71 new in 88 at 19yrs old. Drove that for 13yrs.

Bought a 2001 Z71 new and drove that for 20yrs and would still be driving it if it hadn't rotted beyond repair.

Bought the 2020AT4 with the 6.2 in it and couldn't be happier.

My daily commute is fun and I can either romp on it and blast down the highway getting 16+mpg or I can do the speed limit and get 22mpg.

The fucking thing is amazing.
 
I want to know where you guys are finding $1500 beaters that can be easily put on the road. I've been looking for a decent car for my niece and 4k is about rock bottom for anything that doesn't need at least 2k worth of work before its reliable.

She finally found a family member selling one for 3k which was about a grand under blue book retail.
You have to go back a year or two. Cov-biden has fucked the market up. That $1900 Civic in jan-2020 became a $3900 Civic in jan-2021.
 
A used low mileage truck ins't necessarily a better deal than a new truck, given what the used market is going for.
The idea that a Used truck is significantly less is a notion that ties back to the 70's and hasn't been the case in decades.

Depends on your definition of used. Historically, a new vehicle loses 40% of it's value in the first 4 years, regardless of mileage. Get one 10+ years old and prices are pretty stable year-to-year

You can have a car payment or a repair bill.

Which one is cheaper to you every month? I'll give you a hint. If you turn your own wrenches, you won't need the hint.

If you're on this site, you probably can handle 90% of common repairs.

if you buy a fleet of vehicles in the 5-10yr window, i'd assume they are probably going to cost you $8k on average at a minimum. so either you fork out $24k for your fleet of 3 vehicles or you put down $24k and immediately have "equity" in your new truck. if you get into trouble sell the truck and have money in your pocket.

The $24k in equity will disappear quickly due to depreciation...

I want to know where you guys are finding $1500 beaters that can be easily put on the road. I've been looking for a decent car for my niece and 4k is about rock bottom for anything that doesn't need at least 2k worth of work before its reliable.

She finally found a family member selling one for 3k which was about a grand under blue book retail.

Not sure where you're located, (edit, Texas, just looked) but it depends on where you're at and what you need to do with it. Cars, minivans, that's easy. Trucks and SUV's, well, it depends on what you're looking for. If you are ultra brand loyal, and the segment vehicle you're interested in is high value, good luck (think Wrangler, Tacoma, Mustang, Corvette, Tahoe/Yukon)

The average car payment in America, according to the last figures I heard, it $585/81months. That's $47k and change over almost 7 years or $6700 per year. If you had to have a transmission and an engine installed over that time on a typical 1/2 ton truck, you'd have about $25k left over. Now, it depends on if you can get a vehicle used enough (10+ years old) that's good enough (I typically look for vehicles south of I-70 from where I live to get out of the rust belt) to justify putting the effort into it. Even if you can only do brakes and oil changes yourself, which you have to do to a new vehicle too, you will be in the habit of taking care of your vehicle and noticing problems before they become major.

My DD is a 1995 Isuzu 4x4 pickup. I purchased it from the original owner 6 year ago for $400 dollars. The OO bought it new, and never did anything to it but going to quickie oil change places occasionally and a set of tires once. It had 108,000 miles on it and the brakes were shot and they thought the motor was going to blow. I drug it home as I was going to swap in a diesel from one of my old Chevy LUVs. I found out the plugs had never been changed. Changed them, and it ran like brand new. Had to overhaul the brake system as 2 pads were MISSING due to never having been done since new. Plugs and an oil change for the engine, pads, calipers, and discs all the way around, and for about $700 plus the initial purchase price I have had a reliable vehicle for the last 6 years. Yes, I've had to repair other things, rebuilt the steering 2 years ago, did a timing belt at 130k (70k past manufacturer recommendations:laughing:), basic maintenance you have to do to every vehicle like brakes, tires, and fluids. I have 200k on it now and it shows no signs of quitting. Not counting recurring maintenance items, I probably have $2000 in parts and initial purchase price. I'll swap that diesel into it when the gas motor blows, but it gets 20mpg with the hubs locked in and it may rust completely out before I get to it. If I'd have had a shop do the work, I'd still probably only be $4500 into it. 4500/6 = $750/year. I don't think I could buy a standard cab Colorado/Tacoma/Ranger/Frontier for that. Insurance and tags are way cheaper too.

I know it's not for everyone, but the depreciation of new cars costs people more money than anything else I can think of, excluding toilet paper of course.
That being said, someone has to buy the new vehicles so I will have something to drive in 20 years!:grinpimp:
 
Military bases. Guys move through cars when they deploy/transfer. If you live close to a base and have a buddy who can access said base, many bases have "lemon lots" where people just leave their cars and contact info. After a certain amount of time, they get towed to the scrapyard.
Pretty slim pickins at ours and nothing is cheap. Alot of new cars on base, super scientific i know.
 
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I want to know where you guys are finding $1500 beaters that can be easily put on the road.
I've had good luck finding shit that needs tons of brake/suspension work and has a dirty as fuck interior. Couple hundred in parts, couple hours of labor, a few more hours with the shop vac and good to go.

Shit with a blown engine or trans is 1500 all day long so long as you're not shopping for some yuppie douchemobile.
 
When I took the current job I had a 2000 F250 PSD extra cab with 250,000 miles on it and I would have kept it except I needed a nicer vehicle that I could take clients out to lunch, etc., and I still wanted a truck, (Had a Volvo sedan for about a minute but traded it in on the Ram). Bought a 2015 Ram 1500 EcoDiesel with no money down, (was slightly upside down in the Volvo), with a 5 year 0% loan. I did the math and my mileage reimbursement covered the payment, insurance, fuel, new tires every 50k as long as fuel stayed below $3 gal. It has 15,000 mile service intervals and I use the points from a CC I pay off every month for that, so yeah I could have bought a used Prius and pockeded some money every month, but now I have a really nice truck that was paid for by my job. In 145k miles repairs have consisted of a CC switch and an o-ring on the waterpump housing, fuker even still has the original brakes. There's no reason for me to get a new on, it's still a really nice truck and does everything I need, it's only the second brand new vehicle I've ever bought, and probably won't buy another.
 
When I took the current job I had a 2000 F250 PSD extra cab with 250,000 miles on it and I would have kept it except I needed a nicer vehicle that I could take clients out to lunch, etc., and I still wanted a truck, (Had a Volvo sedan for about a minute but traded it in on the Ram). Bought a 2015 Ram 1500 EcoDiesel with no money down, (was slightly upside down in the Volvo), with a 5 year 0% loan. I did the math and my mileage reimbursement covered the payment, insurance, fuel, new tires every 50k as long as fuel stayed below $3 gal. It has 15,000 mile service intervals and I use the points from a CC I pay off every month for that, so yeah I could have bought a used Prius and pockeded some money every month, but now I have a really nice truck that was paid for by my job. In 145k miles repairs have consisted of a CC switch and an o-ring on the waterpump housing, fuker even still has the original brakes. There's no reason for me to get a new on, it's still a really nice truck and does everything I need, it's only the second brand new vehicle I've ever bought, and probably won't buy another.


Amateur
 
There is no right or wrong answer as the situations/needs are not universal.

I recently sold a 2015 Accord I bought brand new in summer of ‘15. It was paid for and at 83k miles had plenty of life left in it.

A 2005 F250 SD replaced it, closing in at 134k with the truck at present time. Utility of the truck for home renovation projects, access to public lands when camping (we have a travel trailer), and some other factors is why I made the switch.
Going from 35mpg plus to 11 city - maybe 14-15hwy is felt, no doubt about it. However I knew that going in. Truck was paid for in cash, I do my own work as far as maintenance/repair.
Buying new again truck/car never crossed my mind as current new vehicles are technology laden - future money pits.

In addition to the truck I also have a 2001 Miata and 2012 Ninja 650, both are paid for and used in summer/fair weather seasons only.

I keep full coverage on all of them at 250k/500k limits - $500 deductible.
Worth it to me as there is far too many idiots that are underinsured or uninsured roaming around without a care in the world.
Like we used to say back when we were sinking thousands into our four wheeling rigs: “gots to pay to play”...

I kind of come in #2 of your choices overall...
 
Depends on your definition of used. Historically, a new vehicle loses 40% of it's value in the first 4 years, regardless of mileage. Get one 10+ years old and prices are pretty stable year-to-year
your historical data stopped collecting their information years ago. we've bought a couple of cars over the last 5 years. the only cars that were selling for 60% or less of their MSRP were 6-7 years old with a shit load of miles. in the last 3-4 years, cars lose little value being driven off the lot.
 
On an 84 month loan of $45,000 at 3.9%, pre-covid I traded it in break-even after 2 years and 36,000 miles. So in lease jargon it was $618 for 1500 miles a month on a 2500HD gas. Mind you that was total OTD, zero down, financed taxes, with negative equity from a trade. On paper the actual price I paid for the truck was $39,000-2 years later traded it in for $33,000. So in reality, price to price, the new truck only cost me $250 per month.

I'm personally better off "owning" it and not going over mileage or doing something to it that I may get penalized for if it were a lease. Plus leases on 2500s, from what I've seen are stupid.

And the old truck is out back if the new truck ever had to go away.
 
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I rented a suite with no place to do major work on my vehicles or store my tools. A newer, reliable vehicle made more sense than a beater. Didn't go for anything crazy expensive, just a newer, low mile truck that was just under $20k. It's needed an axle seal in the six years I've owned it. I can realistically list it for what I paid so I don't think I made a bad decision.
 
A used low mileage truck ins't necessarily a better deal than a new truck, given what the used market is going for.
The idea that a Used truck is significantly less is a notion that ties back to the 70's and hasn't been the case in decades.

So much this, its really stupid right now.
I can get 5K more than I paid for my 2019 Tundra without even trying too hard
 
your historical data stopped collecting their information years ago. we've bought a couple of cars over the last 5 years. the only cars that were selling for 60% or less of their MSRP were 6-7 years old with a shit load of miles. in the last 3-4 years, cars lose little value being driven off the lot.
This may have more to do with regional variations and market segments you are looking at. The most recent statistics nationwide still bear that out. However, if you’re in a region that has market pressure that keeps values up, good for you. Other parts of the country are not so lucky. Admittedly, due to COVID keeping cars from being built 9 months ago and microchip shortages keeping them from being produced now, we are seeing a good bump in the market for used right now. Cash for clunkers did the same thing to the used market a decade ago. Pushed a lot of buyers that would have bought a 7-10 year old vehicle into a 3-4 year old vehicle due to scarcity. Maybe this bump will be more permanent. Time will tell.
 
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