Trading in VS long term ownership

Donstar · November 30, 2021

16 hours ago, diyer2 said:

Anybody can justify everything they do. You will never convince me that buying vehicles regularly is cost effective.

True. If you live and work in an area with public transportation, the most economical option is to not own a personal vehicle. My brother proved this over a two year span and showed me his data. He took a taxi when public transit wasn't practical and rented cars for holidays. This would have been interesting if I cared. I prefer buying new and trading in my vehicle when it still has significant value. The really smart buyer is the one who buys my trade-ins! However, my current truck continues to give me a new truck feel and performance six years after purchase. It is paid for and a new truck would have to be really spectacular to resume monthly payments. A Silverado EV, Ford F150 Lightening or a Rivian would likely find me speaking to a loans officer.

swathdiver · November 30, 2021

If I lived and worked in an area with public transportation, where they make auto ownership a hardship, I'd move! I cherish freedom more than publlc transportation or a high salary. My family in New York disagrees; they love being nannied.

For the most part, we buy used and keep them until the scrap man tows them away. With the Yukon and Sierra, we'll endeavor to keep them running until our last days and pass them down to the next generation. Lots of fun and memories.

asilverblazer · November 30, 2021

Since I do all my own work - I can do a lot of repairs and upkeep on a car for the cost of a monthly payment. The cheapest option is one thing and what you want are another. I've done a bit of everything, bought new, used, kept, traded, sold... They ALL cost money. The one I think I did best on was my 2008 Silverado bought it new and kept it for 13 years took good care of it never had any major expenses and sold it for a good price. Followed by a 2009 Acadia that I bought for scrap value, made some repairs and got it back in decent shape and sold it for a decent price (basically flipped it).

In the end I drive what I want and/or can pay for.

The most important thing is taking care of it cosmetically and mechanically, because it will always help you in the future, either by it lasting longer for YOU, or selling/trading for more money to YOU. A good looking mechanically sound car is easy to sell or keep.

Grumpy Bear · November 30, 2021

Loan calculator for Illinois on $40K borrowed for 6 years at 2.34% from USAA FSB comes in at $597.00 a month. Not vet? Huntington at 4.23% and 6 year $631.00

Question:

What kind of "routine" repairs/maintenance would cost me $600 a month?

Answer:

None

Fixing an older car/truck really isn't about the money. It's about convenience and trust.

And about 'Being Seen". C'mon now.....Pinocchio

:rollin:

NorthskyblueT1 · November 30, 2021

But that's not the actual difference in cost, because they're paying off an asset that still has value at the end of the term. I'm not arguing keeping older vehicles isn't often cheaper, but at least make meaningful comparisons.

The false sense of self-righteousness and frugal supremacy for having kept a vehicle until the wheels fall off, though, I'm not sure what reward these people are looking for. Congrats? You own an old vehicle?

asilverblazer · November 30, 2021

2 hours ago, NorthskyblueT1 said:

But that's not the actual difference in cost, because they're paying off an asset that still has value at the end of the term.

Its only an asset if you have equity in it, that's hard to do, generally, in a vehicle that depreciates. Unless the payments are high enough to outrun the depreciation or a large down payment as a head start against it, most vehicle purchases are a liability.

I'm not particularly arguing with you either...

There isn't IMO a superior frugal position to be had with cars, they are a loss every which way you slice it. I think it comes down to getting the most out of the money you spend the only difference between any philosophy is what you are getting the most of (money, peace of mind, pleasure, pride, use, looks).

2 hours ago, NorthskyblueT1 said:

I'm not sure what reward these people are looking for. Congrats? You own an old vehicle?

Personally, taking care of my vehicles is a source of pride for me. Keeping them in good condition for a long time and being able to sell them for a good price is validation of that. That has a monetary benefit, but doesn't change why I do it.

My opinion is similar to Grumpy's, the vehicle you already own will almost always be cheaper than switching - if you can do your own work.

I know of instances where people have spent over $5k on a car worth less than 1/2 that. So there does come a point where it doesn't make sense.

Edited November 30, 2021 by asilverblazer

Grumpy Bear · November 30, 2021

2 hours ago, NorthskyblueT1 said:

Congrats? You own an old vehicle?

Really :crackup: The shame card? :rollin:

Equity in a car/truck is like pricing a stock. What it's valued at and what you can get out of it are never the same thing.

https://smallbusiness.chron.com ›

While different cars depreciate at different rates, it's a good rule of thumb to assume that a new car will lose approximately 20 percent of its value in the first year and 15 percent each year after that until, after 10 years, it's worth around 10 percent of what it originally cost.

Not really an asset is it?

Then only if you can find a buyer. I drive them about 20 years so I just totally skip the entire purchase price of one whole vehicle. My maintenance is never even a fraction of the monthly payment. Twice in my 50 year driving history have I lost that bet. Both times I cut bait and bought used again. There is nothing faux about it.

Valued at. There's a joke. We have an MSRP. We have invoice price. We have wholesale and auction prices. We have the bank floor plan value We have a valuation for being sold at the dealer and a different price for a private sale. We have interdealer price. We have what it is valued at selling and another for being bought. How many is that? It's the same vehicle. Oh, wait there is also a salvage value and a junk price. That same vehicle can have a valuation between $500 and $50,000 on the same day. Imagine buy a steak like that.

Here is what it is really worth. What I'm willing to pay for it. You can get get a better price? Have at it. It won't be to me.

Now some call that...what was it? Pompous. Bombastic. Narcissistic. Self Inflated. Maybe so. But I'm never walking and even if I were.....yea....not the big a deal. It's why God gave me feet.

OnTheReel · November 30, 2021

40 minutes ago, Grumpy Bear said:

https://smallbusiness.chron.com ›

While different cars depreciate at different rates, it's a good rule of thumb to assume that a new car will lose approximately 20 percent of its value in the first year and 15 percent each year after that until, after 10 years, it's worth around 10 percent of what it originally cost.

Not really an asset is it?

Up to your old tricks again? Where’s a 2011 Silverado that I can buy for 3 grand?

GM truck forum and you’re cherry-picking ridiculous depreciation “estimates” out of thin air that wouldn’t even suit an old BMW. Especially in this market.

NorthskyblueT1 · December 1, 2021

Grumpy doesn't buy/sell new vehicles, so he doesn't understand. Rambling about God and feet.

Does anyone remember Crash Test Dummies? Now that song is stuck in my head. I bought the CD brand new when it came out in 1993. "Gaaaaaaaaaaahhhhhhhhhd shuffled his feet / And glanced a-round, at them....../ The peeeeeeeeeeopole cleared their throats / and stared right back, at him....

Again, I'm not arguing that keeping a vehicle for a long time isn't a way to save some money. What I said before, and someone else said too, you can turn over certain new vehicles for very little cost. Even if you do the work yourself on an older vehicle, I don't think these two ideas are world apart in terms of expenses even if done with just a little intelligence.

KARNUT · December 1, 2021

WoW I go on trip and the kids are miss behaving. The usual one is stirring the pot. If my mother in law hadn’t decided to quit driving and gave us the CRV. My wife’s Genesis would be close to 200K miles. The cost still be sitting at about 300$ a month. You can buy new cars for that or a well appointed CPO. At almost 66 I’m not going to chance a 11 year old 200K mile anything for a trip across country. Vehicles cost money new or used. If someone wants to load the tools up and chance it good for them. I had to do that when I was younger starting a business. If a person can’t set aside 300-500$ a month for a ride they’re spending too much else where. I think those cost are pretty reasonable.

Grumpy Bear · December 1, 2021

4 hours ago, NorthskyblueT1 said:

Grumpy doesn't buy/sell new vehicles, so he doesn't understand. Rambling about God and feet.

Feeling pretty good about yourself are ya?

Did ya show me the what's what?

:rollin:

You have insight into what I understand do you?

List my vehicles and the types of transactions.

I'll wait.

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Is speaking in ignorance intelligent?

Edited December 1, 2021 by Grumpy Bear

dieselfan1 · December 1, 2021

I used to get a new truck every 2 years or so.

I would average around 50,000 miles a year for work as a carpenter, so I considered a truck just like a tool.

Now that I'm done with my carpenter work I only average about 18,000 - 20,000 miles I can keep them longer. That's why I went balls out with the lift and all my other mods. I'm keeping my lifted truck(2018) at least a few more years.

My stock truck (also a 2018)will be getting traded in next year for a 2023 2500-3500 High Country gasser.

NorthskyblueT1 · December 1, 2021

None of this is a trick or a secret. Buy low, sell high. Do it where rebates and incentives cover a good chunk of the initial depreciation to create a margin for yourself and flatten that curve. Trade something that dealers want.

The way I do it, it ends up being significantly cheaper than leasing, and some new cars have cost me virtually nothing to own for a few years.

My argument is that it can be done relatively cheaply--not that there isn't a value proposition in keeping a vehicle for a long time. Some people on here understand it. And if not, that's OK too. Keep doing what you're doing.