Jp compiled a list of cars owned by personal finance and money-related bloggers. It’s a neat list. He doesn’t say whether the cars are bought with cash, financed, or leased, but I’m sure not everyone shares that information.
I’m probably one of the few people on the list who bought a new car, against most frugal advice. When I was teaching, I wanted to be sure the car was completely reliable, and a Completely Reliable (recent model from a dealership) Honda Civic costs close enough to a new Civic that I thought it would be worth the extra bit. I’m very happy with the choice; I get great mileage and now that I’m driving more than two hours every day, I think it was undoubtedly the right choice.
The money for the car was loaned to me by a relative (his suggestion, not mine) so the purchase could be considered cash. I paid him back a lump sum down payment last year when I bought the car, and have been paying $300 every month (at 2% interest) since. If I don’t increase the monthly payments, the loan will be paid off on November 20, 2007 after spending a total of $14,927.31. I expect that I’ll pay it off sooner than that and have a lower total cost, as long as some income increases come my way.
I did make a mistake by paying too much for regular 20,000 mile maintenance. That won’t happen again. On the other hand, I dropped off the high-risk drivers list, so I’m savings thousands of dollars each year in auto insurance (compared to what I would have been spending over the past several years).
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6:59 am (reply)
Heh. He called your car a “grocery getter”.
/drives an ‘02 Toyota Highlander ULTRA grocery getter.
9:52 am (reply)
Why do you want to pay back a 2% APY loan earlier now that EmigrantDirect can give you 3.5% for your money? Even after the tax you will be better off holding the money. (Of course you can have non-financial reasons to pay it back but that’s another story.)
12:02 pm (reply)
Money loaned by relatives and friends should be repaid fast… If only to keep the relationship in good standing and be able to ask for a favor later in the future.
Goodwill can be very worthy.
9:51 pm (reply)
I bought a new car in May 2005 and now realize that the no-interest loan on the Grand Marquis was padded and I just know I got burned and paid too much. I just want to get rid of it and buy a used Cadillac for the same big monthly note. I just don’t know what to do but I feel so badly about getting taken advantage of again.
1:27 am (reply)
Haha, it wasn’t meant to be derogatory, I was running out of car-slang. My parents have owned 3 Accords. ;)
I agree, if you’re under 25 car insurance considerations sometimes outweigh car considerations. 2 grand a year in insurance is madness.