10 Reasons Why I Prefer a Cheap Car

10 reasons why I prefer a cheap carRecently, I heard on the radio that auto loans are at an all-time high in the US, over $1.2 trillion. The average price of a new car is also very high at $37,500, according to Kelley Blue Book. Whoa, that’s a lot of money. I guess I shouldn’t be surprised, but it is disappointing to see the lesson from the financial meltdown didn’t stick. You shouldn’t buy a car you can’t afford. Personally, I hate having a car payment and paid cash for the last vehicle we purchased in 2010.

The average price of a new car is pretty shocking to me because we haven’t shopped for a car for a long time. $37,500 seems really expensive to me. In 2010, we got a new Mazda5 (small minivan) for about $17,500. It was the perfect vehicle for us. The car had 3 rows of seating and can fit 6 people comfortably. We usually only use 4 seats, but the extra seats came in handy when we had visitors. It’s great to have a cargo area to haul stuff too.

I know it’s not really that cheap, but it is way more affordable than $37,500. Stay tuned until the end to read about the cheapest car I ever own. Anyway, I plan to drive our Mazda5 for 10 more years. We don’t drive much so it’s running pretty well. It only has 55,000 miles on it. The average cost per year should be quite good over our ownership period.

Now that we’re more comfortable financially, we could afford to buy a nicer car. But the average price of a new car looks excessively high to me. A recent accident reminds me why I still prefer a cheaper car. Life is easier with a cheap car. Read on…

1. I like money

I like nice cars, but I love money much more. If we were shopping for a car, I’d pick something not too expensive again. It’s all about priority. Right now, saving is more important than a car. Maybe that will change someday. Luxury and performance are nice, but they are not that high on my priority right now. Having money to invest is way better. Investment will appreciate. A car will only depreciate.

2. Less depreciation

A new car starts depreciating as soon as you drive it off the lot. In general, a new car is worth just 40% of what you paid after 5 years. If you paid $37,500, that’s $22,500 down the drain. You’ll lose less money with a cheaper vehicle. My Mazda5 depreciated about $10,500 in 5 years. I don’t like losing money, but I’m losing way less than the average new car.

A better way to win the depreciation game is to buy used or a classic car. Used cars already lost a lot of value so depreciation won’t be that painful. The right classic car can hold its value or even appreciate over time.

3 Dings and dents

Believe or not, we used to have a BMW Z3 roadster. I used to get so mad when I see a new ding or dent on that car. Why are people so inconsiderate with their car doors? Now that we have a cheaper car, dings and dent don’t bother me that much anymore. We have to park on the street after we moved so it’s great to a little apathetic. Bumpers are meant to be used in this neighborhood.

Why I prefer a cheaper car

Accidents are even worse. A bicyclist ran into the back of our Mazda earlier this month. The bike made a big hole and several dents. The cost of repair is $4,600. That’s crazy! Fortunately, their insurance paid up. I’ll DIY the repair and I pocketed the payout. The total cost of supplies is about $50. That’s $4,750 in the bank. Oh yeah. (The insurance gave us an extra $200 to rent a car for 5 days.)

When you have a cheap car, it doesn’t have to look great as long as it runs well. If this happened to the BMW, I’d probably fix it up instead of pocketing the cash.

4. Maintenance is cheaper

One lesson I learned from owning a BMW is that repair and maintenance are absurdly expensive for luxury brands. It seems like every time I took it in, the dealer charged over $1,000. I also felt more pressure to take the BMW to the dealer.

With our Mazda5, I don’t mind going to a local garage and see what they can do. Maintenance cost way less with a regular car than luxury cars. For example, I paid about $400 for a set of new tires a couple of years ago. New tires would have cost much more for the BMW Z3. Those performance tires are sticker, wider, and skinner – more expensive.

5. Stealth

Another reason why I love our Mazda5 is that it is so anonymous. A gray minivan is basically invisible to the highway patrol. I haven’t gotten a ticket for years now. IMO, a flashy new car is much more likely to attract a speeding ticket. The police officer naturally points the speed gun to a flashy car first when a group of car appears. By the time he switches to my car, I’d have slowed down.

Oh, I also make sure not to be the fastest car on the freeway nowadays. That’s probably more important.

6. Side hustle

You can use your cheaper car to work side gigs with no quam. You could be an Uber driver, deliver pizza, or share out the car. I’d hesitate to do any of those if I have a nice car.

7. Cheaper license and registration fees

This one doesn’t apply to everyone. We have a flat registration fee here in Oregon. However, some states use the value of the vehicle to calculate the registration fee. In California, you’ll pay more if your car is worth more. A cheaper car means paying less for license and registration.

8. Cheaper insurance

I always assumed those expensive cars cost more to insure. According to CBS, the 10 most expensive cars to insure are all luxury makes – Mercedes, BMW, Aston Martin, and Porsche. It looks like I’m mostly right. Regular cars are less expensive to ensure than luxury models.

Another way to lower insurance expense is to go without collision and comprehensive coverage. Our Mazda5 is 9 years old and it isn’t worth that much. I canceled collision and comprehensive insurance a long time ago.

  • Collision insurance – helps pay to repair or replace your car if it’s damaged in an accident with another vehicle or object.
  • Comprehensive insurance – helps pay to repair or replace your vehicle if it is stolen or damaged in an incident that is not a collision.

Why I like cheap cars9. No need to baby it

I have a question for those of you with expensive cars. What do you do when you need to haul a few bags of compost home or bring a moldy cabinet to the dump? Do you just toss it in the back like I do? It’s just easier with a cheaper vehicle. The nastiest thing we ever did with the car was to haul our old toilets to the recycling center. Yuk! I wouldn’t do that in a nice BMW X5. Would you?

I guess if you are wealthy enough to have a luxury car, you can pay people to haul crap to the dump. My contractor wanted $100 to dispose of an old cabinet for me. That’s ridiculous. I spent 5 minutes breaking it apart with a hammer then dropped it off at the dumpster. That’s a $100 saved.

10. Luxury features are not a big deal

Luxury and performance aren’t a big deal to me. As long as a car is reliable and has a good safety rating, that’s enough. I don’t drive fast so performance doesn’t matter.

I don’t care about the luxury features either.

  • Leather seats – Cloth is good enough. I don’t need to sit on a dead cow to drive.
  • Proximity key – Come on. You can’t push a button? That’s why we have thumbs. In the old days, we had to use a key to open the door. Now that’s barbaric.
  • Adaptive cruise control – I only used cruise control when we drive long distance, probably 2-3 times per year. The old-style cruise control is good enough for me. Adaptive cruise control probably would make me sleepier anyway.
  • Backup camera – Ok, Mrs. RB40 would love this. I don’t need one, though. That’s what the bumper is for.
  • Heated steering wheel – Seriously? How did people survive before this feature? Toughen up!
  • Seat warmer/cooler – This one sounds good to me. Although, I probably wouldn’t use it much. Portland doesn’t get that hot or cold. Also, cloth seats don’t get that cold like leather seats. I don’t need it.

I’m not a car guy anymore

Some people are passionate about cars and that’s okay. I’m just not one of them. A car needs to get us from point A to point B safely. That’s the main feature I’ll pay for. A regular car can be just as reliable and safe as a luxury car these days. I don’t see a point of shelling out more for an expensive car.

Okay, here is the promised story about the cheapest car I had. I got an ancient Subaru GL wagon for $500 as a second car. I used it to practice driving a stick shift and drove it to work. After a couple of years, I sold it to a friend for $500. See, I told you classic cars hold their value. That car was not safe, though. I wouldn’t put my son in it. I don’t think it even had airbags.

Alright, leave us a comment. Do you drive a cheap or an expensive car? Why pay more? What do you drive now?

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Joe started Retire by 40 in 2010 to figure out how to retire early. After 16 years of investing and saving, he achieved financial independence and retired at 38.

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59 thoughts on “10 Reasons Why I Prefer a Cheap Car”

  1. Expensive cars are stupid. They are right there next to me crawling along in rush hour traffic. I have a 2006 Corolla stick shift! My mechanic says it has the same engine as a Mercedes and I believe it because I can accelerate right alongside a fancy car. It uses barely any gas or oil, needs little maintenance. I had to replace the converter awhile ago after the tailpipe literally fell off, cost $800. That was the most I ever paid. When I take it in for inspection they love my car because it’s a stick.

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  2. Bought a 2011 Nissan rogue used in 2013- had 3000 miles in it. Fast forward to now, almost 2020. Has been paid off for 4 years, and has 35000 miles in it. My round trip commute each day is 7 miles. I figure this car will last me another 5-10 years! The money saved on a car payment will easily allow me to pay cash for my next. And I agree- repairs and service are so much more reasonable on a less expensive car!!

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  3. Hi,
    Couple of year ago I was pretty broke but I got a job very far from where i was living. so I bought very cheap car ‘Chevrolet Corsica’ 1997 I believe and 430 000 km for $250. Yep! No more than that.
    And you know what? With remote starter! Can you believe it. I was in Quebec city in this time.
    Lots of snow in winter and from home I was able to use my remote to start my old Corsica every day. I used my car for little more than 1 year and she died but I didn’t expense one more penny on it, except the gas of course. It was the best purchase ever.

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  4. I’ve always had good luck with cheaper well depreciated vehicles. I’m definitely a car guy so its hard for me to resist some indulgent purchases, but even when I do they will still be something that’s gone through the bulk of its depreciation. I currently drive a 04 Escalade that I picked up two years ago with 212k miles for 3500 bucks, I use it as an every day work truck, haul garbage, tow trailers and multiple runs to Home Depot every week. It has 241k miles on it now and I plan to keep it till it hits 300k unless something comes up that’s not worth fixing. Everything on it is pretty simple to fix as its the same gmt800 platform that all gm trucks were based off for vehicles around that year, Tahoe, avalanche, Yukon, Silverado…etc. it blows me away how many People complain about being broke yet drive something that’s only a few years old making payments. Vehicles now last much longer then they did in the 70’s and 80’s. I saw a Chevy express van with a 5.3l engine (original motor) with 674k miles on craigslist a few months back still running strong (on the 3rd Tranny lol)

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  5. Hmm- I think one aspect that gets overlooked a bit regarding car cost discussions on personal finance sites is safety. Now that I have a kid, I wouldn’t want to skimp in this area. Generally, safety improves with each generation (So every 5-7 years). Given that, I always want a car that is of the current generation. The most cost effective way I’ve found to do this is just to find good lease deals. Buying new and keeping for 5-7 years ends up costing about the same as a good 3 year lease deal on an annual basis.

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  6. The subaru GL wagon sounds like a good deal! I appreciate your comment about “average cost per year over the ownership period” as the costs of car purchase and ownership can fluctuate at lot year-to-year. Buy cheap like you did and keep up with basic maintenance and your average per-year cost can be very low.

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  7. So true in my past I purchased a few new cars. Most of us can’t afford a new car so we finance. The average new car payment is $479.00. WOW… Hard to get ahead when paying on 2 cars. When I sold my car to get out of the payment it was amazing how much quicker I was able to get out of debt. I currently drive a paid for 04 Kia Amanti…..people are always concerned about payment amount not the price of the car!
    Joe your posts are always make me think great content…..Al

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  8. Hi Joe,

    Multi-year reader, first time commenter here! We also enjoy cheap cars. We recently landed in one of those funny states where the registration is based on the value of the car so we saw some unexpected savings! No strategy though, didn’t realize there were states like that until recently. I also enjoy no state income taxes! I drove my last car 14 years, and wife’s Honda is approaching 12 years!

    Max OOP

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    • You must be in WA. 🙂 I’m very envious of the no state income taxes. OR is killing us with the high state income tax.
      Although, I think we’re mid-pack when we look at overall taxation.

      Reply
      • Thought I would let you know this comment was the last action I made on my 2008 Mac Book Pro : ( Shortly after this, my computer crashed and may be out of commission permanently. Don’t worry, it was on its way out, so you should be honored! On my work laptop until I find a new one! I am actually in New England.

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  9. “I like nice cars, but I love money much more.” Same here. 20 years we started with cheap cars and as income went up, lifestyle inflation came roaring. It was a new Audi A4. Then it was a new BMW 5 Series for me. Then I added a BMW x5 for my wife. We loved both cars but I then (finally) came to my senses and FIREd in 2015 at 36 and realized those “assets” were actual liabilities in my head. We downsized the house and cars and now only have 1 car. More dollars in the bank and more free space in my head.

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  10. “I like nice cars, but I love money much more.”

    Me too. I think the biggest advances of the items you mentioned in the list are “less depreciation” and “no need to baby it”. Life is so much less stressful when you don’t have to worry about someone denting your brand new BMW every second of the day. This goes for other stuff as well (fancy clothing, new furniture, electronics). People don’t realize how much of their life energy is used to impress other people with nice things and all the upkeep they have to do. So not worth it. Plus buying used is good for the environment.

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  11. I still don’t own a car. Since I don’t have kids yet and I have very simple transportation needs (just a short commute and a couple other trips per week), I can live with bikes, public transportation and Uber/Lyft. If I ever buy a car, it’ll probably be a cheaper one. Not worth spending a lot of money on a depreciating asset that gives me lots of worry!

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  12. Older cars are easier to fix compared to newer cars. New cars require sophisticated computers to run a proper diagnosis. Not all cars are depreciating. A honda civic si 2000 is only gaining value each year. A 1995 integra type R goes for $40,000. Some cars become legends and people are willing to pay big bucks for them.

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  13. Hi Joe,
    I totally agree with you! I bought my used 1996 Honda Accord almost 4 years ago and now have 345,000 miles on it. I am sure at least half of those miles are mine as I drive alot for work and we have taken the car on trips to CA, Yellowstone, OR, and Canada from our home in WA. The car is comfortable for the long trips so that is good and I only paid $2000 for it after selling my 2004 Hyundai for $1500. I feel like I have gotten my money’s worth and we save even more because I don’t have full coverage and my husband does most of the maintenance. The car is burning some oil now so we have to monitor it. We also have a 1994 Toyota pick up with less than 200k miles that we can use to haul stuff.

    I totally agree that expensive cars are a waste of money. In my job I have the opportunity to look at car loans and I have seen car payments bigger than my mortgage and car loans at ridiculous interest rates financed for up to 96 months. It never ceases to amaze me the ways that people spend their money! Thanks for a great blog!

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  14. Cars are probably the greatest way to waste money known to man.
    Not only do they cost money to buy, and that money costs even more if you have to rent it (finance) and they cost money to run, and maintain and fix – BUT by getting a car you immediately get lazy – chances are you’ll put on weight (why walk when you can drive) and I’m not sure but there are no drive-thru salad bars – so you’ll start eating crap as well.

    Can you live without a car? I’d say yes but you need to do the living – if the default is a car centered life then you can do it cheaply – but you’ll be look at like a gypsy if your car isn’t as flashy as others (but you can handle the stigma of appearing to be poor, right?)

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  15. Your dead right Joe. Owning a cheap car is just a better way to live. I’ve saved countless thousands over the years because I don’t own a nice car, and I don’t drive much either.

    We live in one of those states that charge the licensing cost depending upon how valuable the car is, so it pays to drive a cheap beater car there too.

    I can’t emphasize enough how important this idea is. I’ve seen relatives waste hundreds of thousands of dollars on cars… only to wreck them or have it damaged while its parked outside. Such a waste.

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    • That’s what I thought about WA. I couldn’t find the right info on the internet, though.
      It’s pretty amazing why people spend so much on their car. If your finance isn’t solid, you should just get a cheap car.

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  16. LOL “I like money” goddamit I laughed too hard at that. I don’t get car people but my stance has always been like that. Pffft hahahaha “I like money” jesus bawahahaahaha!! Sorry I read in the driest and sarcastic voice. God bless you!

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  17. I grew up in NYC. I didn’t have a car from age 18 to 26 although I would occasionally use my parents’ car.

    I needed one at age 26 to get to work and purchased a used vehicle for $5,000. It was good for a few years. Then I went without a car again for about 5 years.

    I finally decided to lease an SUV after having kids. It was getting too hard to drag around car seats and strollers all the time. Economically, the cost of the car far outweighs the utility. But it makes my wife happy to have access to a car.

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    • We went carless for 3 months before we got our current car. It was okay, but I like having a car. Life is a lot easier.
      I don’t think we can go carless now that we have a son. I need to take him to various activities.

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  18. I’ve started to think that the depreciation is a little overblown. A lot of people consider 10 years to be the life of a car, so if it’s worth 40% after 5 years, that’s about par for the course. You used up the easy 5 years of the good warranty and clean car and you have 5 years left of needing to replace some parts and having it be a little dirty.

    Of course, I like to drive cars more than 10 years, but maybe I’m in the minority.

    We have a cheaper beach car for mud and dogs (Subaru Forester) and a more luxury car (Acura MDX) for my wife’s commute and our longer trips, which are frequent. The comfort of the seats themselves is a big deal. The Forester is fine for trips under an hour. You don’t want to spend 2-3 hours driving it when the Acura MDX is an option.

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    • After 5 years, depreciation should be much less. My research said 20% the first year and 10% every year after that.
      Next time, we’ll look at newer used cars. The Acura MDX sounds nice. We rarely drive long distance so it’s not a big deal. Our Mazda is comfortable enough, but maybe that’s just because I don’t know any better.

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  19. We’re in that statistic of paying the average $37k+ (our total was just a bit more). However, we tend to drive our car for many years, and we use it a lot — road trips are a family favorite. I don’t think of us as an extravagant family, but the cost of any of the cars we were interested in (we ultimately got a Prius) was all pretty expensive. Of course, we live in NYC, so sticker shock is all relative. NYC is so expensive for everything else that the car seems a bargain by comparison!

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  20. You can still have stellar, push you back in the seat acceleration and glued to the road cornering on the cheap if you shop wisely. My current daily driver cost all of $7,000 and performs comparably to that Beamer you had. It has a few years and a lot of miles on it but it looks new and somebody asked me a couple of months ago if it was a 2018 model, he was only ten years off! At my stage of retired financial independence I could buy any car, but I still love finding a bargain.

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  21. I drive a Honda, so I guess that’s in the middle? I know it was cheap for us when we got it because it was $14,000 with under 25k miles on it. (It had a dinged-up paint job, so it wasn’t worth as much. I didn’t care about aesthetics, so I was happy for the flaws.) I doubt I’d find that good a deal again, but I’ll definitely be keeping my next car search (may that not be for many, many years!) on the cheaper end of car models. In the meantime, I’m putting away money each month so that I’m either used to a car payment when the time comes or (hopefully) will have enough to pay cash.

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  22. I agree whole hardheartedly.

    I’ve driven used cars for 10 years at a time. It saved a lot of money versus running out and buying new cars every few years.

    One item #4 though, I think is probably usually the opposite case.
    Usually new cars are cheaper to maintain than cheap old beaters. But the costs vary by brand. Joe had a BMW and my understanding is that brand is particularly expensive for maintenance/repair. A used Mazda may be cheaper to maintain than a new BMW but a used Mazda is usually not going to be cheaper than a new Mazda and a new BMW should be cheaper than an old BMW.

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    • I meant maintenance usually cost more for luxury makes. Parts are more expensive. So changing the fuel filter would cost more on the BMW in general.
      I agree that newer cars don’t need as much maintenance every year.

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      • Yeah I think thats true. For luxury cars I think its not just the cost of parts but the dealers and mechanics just tend to charge more since they have a more affluent customer base. “cheap” and “luxury” just don’t really go together.

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  23. I’m with you for the most part on this. I plan to write an article on this in a future post, but I just caution to not go too cheap/old and sacrifice safety. It might not be something you think about when you’re young and single, but definitely something you consider if you have a family. Car safety has come a long way. Check out this video comparing a 1998 Corolla vs a 2015 Corolla https://www.youtube.com/watch?v=xidhx_f-ouU Hard to imagine driver airbags weren’t even standard in 1998. Mind you Toyota’s are known to be built well, but you can see the 1998 Corolla just disintegrates compared to the 2015.
    I’m still driving a 1998 Mercedes(luckily, it has airbags!), but we recently traded up my wife’s 2004 Lexus (surprisingly it was in worse shape than my Mercedes) to a new Tesla Model 3. It is definitely a love-hate relationship. While the car is fantastic and is one of the safest cars around and the benefits of driving electric saves money over time, all the things you’ve mentioned are the negatives. The car payment sucks, having to baby it, etc… We will see how it goes.

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  24. Allllll of these. I drive the “new” car in our house and it’s a 2008 and plan to keep it for a looong time yet. There are days I miss my 1996 Buick though. Stealth mode is awesome when parking at a trail head as well – my car clearly is nothing / has nothing of value and isn’t worth breaking into! ?

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  25. Our 2006 Toyota RAV4 only recently hit 40,000 miles and our 2007 Mazda 3 has closer to 30,000 miles. As much as I’d love to have newer, nicer, more luxurious, and hybrid or electric cars, I cannot responsibility justify it and also live up to my FIRE ideals. Our kids will be driving age in a few years. I think we’ll be happy to already have reliable used cars which are a little beat up.

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  26. we have a 2005 mazda 6 bought new. it only has about 80k miles and is mostly fine save for a little rust. i also have a 2014 mazda 6 bought new for about 20 grand. that still seemed like a lot of money to me. the ’14 is a great zippy car if you enjoy driving and it has gotten me through buffalo snow for 5 years with no problems. i would have bought the smaller mazda 3 hatchback for a little less if i could go back. we’ll keep ’em until they turn unreliable.

    i agree with you on not having to worry about them if they cost a little less. i drove for many years with no a/c or cruise control so those are my mandatory items. all that being said i hate paying for car insurance every month.

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  27. I’ve got a Hyundai with maybe 145k on the ticker; I bought it new fifteen years ago and learned stickshift on it driving off the lot into a Friday rush hour around DC. It goes through an alternator every two or three years and right now has a frightful noise coming from the left front brake caliper… but it’s been paid off for a decade. When my wife’s car (a 2005 Mazda with 90k) eventually dies, we’ll probably buy something electric under $20k — so probably used — and convert to a one-car household.

    It feels marvelous to drive around in a beat-up old econobox, in an area full of expensive cars, and realize I have more freedom than anybody else on the road. I’ll merge whether they like it or not… and I’ve got the dents to prove it. 😉

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  28. My first vehicle was a scooter max speed 53kms/hr but I usually only went around my small town on it. Super cheap on milage too. Cost $800 to buy and sold for $800 after 3 years.
    Second car was a 1995 rav 4 for $2700. Scrapped paint and I scrapped some more in getting my license. Also watched youtube videos and did all the maintenance on it. After 5 years it died and sold for scrap for $300. Bought a Rav 4 2000 18 months ago for $4800. Pretty good milage and roomy. Yearly maintenance and rego costs are $1000. All cars bought for cash, only liability insurance and most kicks dents and scratche’s fixed DIY. I did spurlge on a back and front camera to be put on which was good as when I was involved in a accident the other drivers insurance paid out to me on the basis of the footage and I managed to fix everything myself. Pocketed $2000.

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  29. haha, good Timing with your post, I have been thinking about changing our family car but (Today BMW S1) but we don’t want to spend that much money, now we understand is better to have that cash in the investment accounts.
    So… I’m figuring out how I can get a brand new car from my company. That would give us a brand new luxury car at 0 (zero) cost!
    Salespeople get a free car (including all expenses ) so, being a sales guy seems to be the right way to do it!

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  30. “Backup camera – Ok, Mrs. RB40 would love this. I don’t need one, though. That’s what the bumper is for.”

    Oh, hello, every driver in my neighborhood! 😛

    I’m totally on board with the cheap car. I’ve been driving the same car, a 2004 Accord, that my parents gave me as a high school graduation gift. Been through fenderbenders, breakdowns, burned out wiper motors, sideswipes with it. Being a bit of a “car guy” myself, I learned how to do all my own maintenance, which has kept the car in top running form since. I also live in a major city (New York) and only use the car to visit my parents in the suburbs or to haul stuff around the city (for which it is invaluable). Insurance, maintenance and gas cost me in the ballpark of $1,500/year total, which is only a couple hundred more than it would cost me in cabs, rentals, and heavy rail tickets per year with a lot less of the hassle.

    My first car was supposed to be an ’86 Nova, that my dad purchased new and kept alive until 2005 (juuuust shy of my graduation!) when it became infeasible to not get something else. In 2019, I’d have absolutely loved such a “classic”, but I’m still happy with my 15 year old car!

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    • Nice going with the Accord. I had an old Toyota from my parent too, but I only drove it for about 2 years.
      I assume you do the maintenance at your parent’s home. I can’t imagine doing car maintenance in NY.
      We lived in a building and can’t do any car maintenance in the garage. Now, we live in a house, but only have street parking. I won’t be able to do car maintenance until we get a real garage.
      Wow, ’86 Nova. That was in Beverly Hills Cop. 🙂

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  31. I’m actually in the midst of writing a post where one of the things I’m talking about is selling my 2009 Chevy Malibu. I love that car and hate to see it go, but with the big move to Panama coming up, it’s time. 🙁

    I’m with you on the used cars. It saves you a ton of money over the years and you’re not so worried about scratches and dents. We’ll never buy new again!

    — Jim

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  32. This is where I fell off the wagon personally. I splurged on some expensive cars in the past (although I think I make up for it a bit by holding on to them for a long time).

    First was a new Mercedes right before I got out of a fellowship and made an attending salary. I think in 2004 the car cost me $45k (had to finance it). Kept it as my daily driver till 2015 and then really went off the rails and bought a brand new Tesla (first 6 figure car I owned). I did pay for it with all cash this time though. Plan on keeping this one for a while. But you are correct, driving something that pricey comes with a lot of extra costs (insurance and worrying about damage). Driving with electricity though and minimal maintenance does offset the cost each year though.

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      • I actually have two posts regarding my cars, which I am trying to fit on my schedule within the next month or so.

        But to answer your question, my electricity is quite low (9 cents/kwh the entire day). On average 1 kwh will get me a little over 3 miles of driving. In my prior car (25 mpg) my fuel cost usually is 4x higher.

        No oil change, etc so running costs are minimal (just tires). They used to recommend a service every 12.5k miles but then Tesla came out and said that they found out hardly anything needed to be done and now don’t have a recommended service interval at all, said to bring it in when there is an issue.

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  33. Cars are polluting and lead to endless death and destruction in our society (you know my stance on this). Yet we worship them in America, even as our citizens die at their hands by 100 per day. Buying and driving old used cars was probably my second biggest contributing factor in getting to FI quickly, behind not inflating my house. If only America would wake up and see the money they waste on their cars

    Reply
  34. Hi Joe,

    I don’t own a car but if I were to buy one I reckon I’d use a list similar to yours. One thing I didn’t see listed that I would consider is how many “miles per gallon” the car provides.

    Elon Musk just recently said that Tesla cars are now appreciating assets because they have full-driving capabilities (and presumably because their owner will be able to rent them out). Sounds good in theory, but I think there’s a lot to do before I’d consider getting a car as an investment :-).

    Reply
  35. Hi Joe, my car is older than your car! I have been driving my little VW Rabbit (discontinued) for 10 years and it still runs great! I’d like to get an all electric car but I’ll wait for another few years since I love my Rabbit and also wait for electric cars to improve. I agree with you totally that the purpose of the car is to get us from point A to B safely… I never get it why some people want to spend $$$ such as a small house on a car? You can’t sleep comfortably in it, it doesn’t have a bathroom, basically you just don’t spend that much time driving the car.

    Reply
    • How about a hybrid? They have been around for a while. I think I’ll give the electrical 5-10 more years to improve.
      We can’t get one right now anyway. No place to charge it.
      Right, the driving time is a big one. I only drive about 5,000 miles per year. That’s not much. If I spend 3-4 hours on the road every day, then maybe I would consider a nicer car more. Thanks for stopping by.

      Reply

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