This is a guest post from Joel Berry.
I recently had a talk with a friend about why I haven’t purchased a new car. He can’t understand why I still drive a 1995 Geo Prizm. I can afford to buy a new car, but I choose not to. The fact is, driving an older car saves me money!
To prove my point, I ran some numbers. I was surprised by how much money I’ve saved by driving this car for so long.
Used vs. new
I bought my Geo Prizm in 1995 with 5,000 miles on it. It now has 140,000 miles on it and still runs fine. I paid off the car in 1999. It is now 2008. I haven’t had a car payment in nine years.
How much has this saved? Our payments for this car were $250 a month. Over nine years, I’ve gone 108 months without making a payment. At $250 a month, that’s a savings of $27,000.
Over the lifetime of the car, I’ve spent less than $2000 in repairs. Subtracting this from my savings still leaves me with $25,000 extra over buying a new car right after the Prizm was paid off.
Using past history as a guide, I can assume that my car will need more repair as time goes on. The most recent repair cost me $1,000. Let’s assume the worst and say I would spend $1,000 a year for every year that I keep the car from this point forward. Now, let’s compare that to the cost of buying a new car.
Assume that I could buy a newer car for about the same $250 payments I had on my Prizm. (I think that number is a little low, but let’s just assume.) That means my annual cost for a new car would be $3000. If we figure that I’ll spend $1000 a year repairing the Prizm, it still saves me $2000 a year over buying a new car. If I were able to keep the car for four more years, that would add $8000 to the $25,000 I’ve already saved.
I will have basically saved $33,000 by driving my old car for a total of 17 years.
Other savings
But wait! That’s not all! I’ve also saved money in several other ways not accounted for in the numbers above. Some examples:
- Cheaper insurance
- No down payment
- I’ve freed up money so that I didn’t have to take on as much debt for other expenses
I’ve also kept the Prizm long enough that the items I did have to replace early on for the car are now covered by a lifetime warranty. Any time my starter, alternator, struts, or brake pads wear out, I can get replacement parts for free from Autozone. I can fix the car for just the cost of labor, or fix them myself.
There are some drawbacks to having an older car. I once had to have the car towed, and then was without a vehicle for five days while it was being repaired. I also spent a few weekends doing work on the car myself in order to keep costs down. The car is starting to rust. And, of course, it no longer has that new car smell.
I didn’t include the cost of oil changes or tires in the numbers for repairs. I figured this was normal wear-and-tear that would have occurred no matter which car I drove.
My goal is to drive the Geo Prizm for another four years. I am going to put away $300 a month. (I’m putting away $300 instead of $250 because the price of cars has gone up since 1995.) I’m putting this money in an ING Direct account to use for car repairs and a down payment on another used car. If this works out, I should have $10,400 set aside for a down payment on my next car, and will have spent an additional $4000 in maintenance for my current car.
I realize this might not work for everybody. And who knows? My next car might not be as good as the Prizm has been. But numbers like these are why I have opted not to buy a new car yet. I have better things to do with my money than to keep up with the Joneses.
J.D.’s note: I think Joel’s story is awesome. Though I complain incessantly about how much I want a new Mini Cooper, the fact is I’m following Joel’s plan, too. I’ll drive my Ford Focus into the ground. This story reminds me of Dave Ramsey’s Drive Free, Retire Rich. Photo by Jami Dwyer.
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Just wanted to share…We have a 1990 Geo Prizm I bought in new April of 1989. YES. 1989. It is still running just fine! A little worse for the wear on the interior–and of course have had to do maintenance and repairs along the way! But, we think it should be a status symbol–how OLD your car is, not how NEW!!! We are at 15 years now of no car payment! (Ching Ching!) It has hit 240,000 miles (I think, it’s with my husband at his work right now or I’d go look). Keep enjoying your GEO!
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Nice to see, in writing, the savings aspect of owning an old car. I’ve driven my Mazda 626 since 1990 (bought when it was 1 yr. old), until my teenage daughter started to need her own set of wheels this past Oct. I finally got my “new” (used) car and daughter is happy to have a car for getting around town. Prior to that, my first car was 16 years old before we donated it.
P.S. You forgot to mention the emotional attachment one can have with ones long-running car.
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Great article! My husband drives a 1989 Honda that is still going strong- we’ve spent less than $1000 on repairs in our 6 years of marriage. I drove my 1996 Toyota until it pretty much fell apart. I bought my new to me 2006 car last year and plan to treat it the same way. Hopefully I’ll still be driving it in 2018 at least!
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Assuming that you would buy a new car that is lower end (much like the Geo was when it was new), it’s hard to find a low end car that gets good mileage these days. So you probably save money on gas too.
Also, new cars are designed to need brake work done more frequently than older cars. My car (1989) has needed new shoes once in the last five years. My husbands car (2005) has needed new shoes several times since 2005.
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Preaching to the choir here. I drive a 1995 Toyota Tercel. It has 68,000 miles on it. No, it has not turned over. I got it FREE from the original owner. I figure it has at least another 10 years on it. I only drive about 5000 miles/year. Its a manual, gets 40 mpg on the highway, 33-35 in the city.
It’s tiny, and we’re always crowded in it, but it’s basically a free car that costs maybe $30/month to operate, with another $35/month in insurance costs. Can’t beat it!
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What a great idea, I had my car for almost 10 years and I never once saved a penny towards a new car, though what a great idea that would have been, ugh! Now I have a 1 year old car, but I plan on having it also a long time. Great tips
http://newlyweds.wordpress.com
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We have 3 kids, and two cars, in a land where public transportation isn’t an option. My old Mitsubishi Expo died a painful and expensive death before 125K miles – and we were highly offended.
Our 1990 Camry has about 255K. We actually bought it new- a LONG time ago. It is not too pretty, but we put in about $500 for three simple repairs this year, and it is still going strong. Its mileage is really great!
I drive the kids in a Honda Odyssey that was purchased used with a warranty. We have a couple of years to pay it off, but hopefully we have protected our next used car savings – in case the Camry decides it deserves a rest. We hate car payments and hope to look forward to a long – payment free relationship with our Honda. Yes – we believe in regular oil changes and checkups!
Hooray for old, reliable, payment free cars!
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I think your calculations are fine, they make perfect sense.
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Yeah! Those are the same reasons why we drive a ’91 Volvo, as well. With nearly 300k miles on it, it still runs great. Yes, we have to get something fixed occasionally, but never as an emergency so far. We plan to get at least another two years out of that sucker.
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I love this post. We have fought with cars and car problems for 30 years. Two and a half years ago we moved to Costa Rica and dumped all four of our cars! We are just now thinking about maybe buying a scooter, post traumatic stress from cars is starting to ease up.
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Here’s the thing…People choose to spend money on some things that others don’t. My brother in law spends a TON of money on collecting skateboards
Money is a fungible good. Transportation is a sunk cost. If you spend 2 dollars on a subway pass or 30 dollars on the vehicle that money is NEVER coming back. Is it wise to spend your money on your car…well if it makes you happy and doesn’t break you financially…sure.
The goal of this website is to promote good money choices over time. Basically, that means spend less than you make. Ensure your retirement and have some money saved up for emergencies.
But ultimately, you only ride this merry go round once(unless you believe in reincarnation–in which case you only get to be this person once). You cannot simply save and save and save and expect a balanced life. A ridiculously large bank account does nothing for me if I’m too old to actually enjoy it.
So. If your choice is to keep a car for 15 years or more as your avenue to save money. That’s fantastic. People on here have nailed it on the head with the amount of money you can “save” on a car.
But, if all you do is save you miss out…I’ve got a great balance sheet. I drive a 4 year old car. Did not buy new(This is advice EVERYONE should follow).
I’ve been all over the world and would not trade those memories and experiences for an extra 100k in the bank EVER.
Just remember to balance your life. Take the advice if it works for you.
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@Fred: That’s why i got a (pre-owned) car that i truly like and enjoy driving. Because i do like to drive, so the time i spend in my car ought to be pleasurable.
I could certainly save even more by getting a real “beater” and not having a car payment, but that’s a “sacrifice” i was personally willing to make, because i wanted something fun.
Good points. I need to do some traveling.
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I just bought a certified used 2006 Volkswagen Jetta 2.5. I paid under Thirteen Thousand for it. It has about eight thousand miles of the warranty on it plus another two years of additional warranty. The interest rate is from VW, and it is .09. My payment is under two hundred a month.
I have an older VW Golf. It is a great car, but the timing belt broke during operation and it will cost over a thousand dollars to fix it. I will fix it myself when it gets warmer, but it will take time.
Some points I’d like to mention. Right now you can get incredible deals on financing on used cars. This didn’t use to be the case. VW has the best Certified Used cars (according to third party evaluations). The woman who bought this car new paid over twenty six thousands dollars on it (they accidently left the invoice in the car). This car is much safer then the car it is replacing. Further, it has many more features. Finally, saving is good. However, life is too short to not live a little provided you do it with some common sense. OK, one more point. There is some value to peace of mind especially when you need a reliable car for work purposes. If my car breaks in the next two years and a half years, I know I am covered.
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I own a 1987 BMW e28 with 250K miles on it still running strong not even strange noises, if i keep my head cool my goal is to keep driving it for another 10 years. two years ago i spent aprox $6500.00 on new exterior paint, new head liner, re-new front leather seats, if i’m gonna keep the car it’s got to look good so i can appreciate it, so far the only maintenance needed is the basic oil and filter change every 7K miles, i use pure synthetic, since i do my own oil change why not shoot for better oil + it’s technically the only maintenance required on my car. my trany is manual i know it should last the life of the car, i really like my car it has all the whistles and bells you can think of, by the way i used to spend about $12800.00 on my previous car per year but i got tired of wasting my money on silly new cars. There’re way better things to do with your money. People look at their cars like it’s the core of their life, personally i think it’s stupid to keep replacing a good reliable car just to show off a new model.
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I own a red 1990 Geo Prizm with only 131,315 miles on it. I bought this car in 2000 when it had just over 64K miles. This is the best $4K I’ve ever spent. I paid off the car in early 2002 and haven’t had a car payment since. The car gets great gas mileage and has been an excellent vehicle. I plan on keeping this car until it falls apart. Too bad they don’t make many cars as good as the Geo Prizm these days!
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I am very attached to my 95 Jeep Grand Cherokee Laredo which has 142K miles. I almost had a heart attack yesterday when an old lady ran us off the icy road and I was certain she was going to crash into us. Thank goodness the Jeep took the curb and piled-up snow bank like a champ. What would I do without my “baby?” I can’t just replace her that easily. The interior is immaculate and I’d be hard pressed to find another in such good condition.
I see lots of older Jeeps on the road, so many others must feel the same way. My advice, look for a model of car that you see lots of used models driving around–it’s a good sign they last.
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A good friend of mine leased a tank Caddie in 1990. Loved the car so much he bought it. About a year ago, he reached a point where he was VERY concerned about the reliability of the car. As great as it looked (he details it monthly), things were going wrong. He called his mechanic and asked how much it would cost to replace everything mechanical on the car (engine, transmission, etc.). $15000 he was told. So he does it and tells me, “Where can I get a gorgeous Caddie like this for less than $50K?” Not a bad idea. I have usually kept a car for no more than 3 years. My current one, 2001 Volvo S60, is the first one I have decided to keep. It looks new and has cost me about $100/mo in maintenance and repairs. Cheap compared to what it would cost me for a new one every 3 years.
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I drove my last car, a 1989 VW GTI 16v to 360,000 miles and it still ran when I sold it on eBay for $860. I had that car for 13 years.
I currently drive a 1987 Honda CRX Si with 181,000 miles. I paid $1200 for it have put just over $2k into it over the past 3 years to keep it running in top shape. I plan to drive it to at least 300,000 miles before I sell it IF I ever do. I may just keep it as a second car when I buy my dream car; a Porsche Boxster, I’ll buy a used one probably a 1997 – 1998 you can get one on eBay for about $10,000 with around 80,000 miles.
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I drive a 1989 Saab 900 S and couldn’t be happier (click my website for photoblog). The previous owner was a nice elderly lady who took very good care of her car and maintained it meticulously with a competent local mechanic who specializes in Saabs. The car runs beautifully and is very fun to drive. As long as I continue to give this car the same attention and care the PO gave it, I believe it will last another 100K miles.
I didn’t read every comment so I don’t know if this has already been mentioned, but new cars these days often require complicated diagnostic tools that only the dealer has. Whereas older cars are much more amenable toward being repaired by even the most basic DIYer. I’ve saved hundreds of dollars already by doing some basic maintenance work myself as well as some minor repairs. Before I bought this car, any notion of me doing automotive repairs would have been met with laughter. I can honestly say that I’m happier now with my Saab that I purchased for $2,000 than I was with my previous Infiniti M35, which was purchased for just under $50K.
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i have three towncars,a 92,94 and 95 each under 100.000 miles.no note,cheaper insurance perfect for a 34 yer old college student.
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I read all 211 responses. I used to think that a new car was everything, and I’d replace it every few years to get the latest body style. I bought into the idea that you are what you drive. I had a 2003 Mercedes Benz E320 with a $630 car payment; insurance was another $150 a month; repairs and maintenance in 2008 was $4000 at the dealership. The car had two struts that were broken, each strut could only be purchased through Mercedes-Benz at $1100 each, plus labor which was another $300-500 per strut. The car also needed the 75k mile maintenance which was another $1500. I was what I drove: Broke.
I am a 25 male. At least for guys, a car is more important than for women. My Mercedes was like a gold digger girlfriend, sure everything looked good, and it was fun to play with, but the price was too steep.
I knew someone that had a 1995 Saab 900 SE with 162,000 miles for sale. The car is worth about $2,000, and I was able to buy the car for $800. The convertible top and A/C does not work, but other than that the car is fun and safe to drive. I paid to have two new tires put on this car, an oil and filter change, a smog check, and the California DMV fees, all together that was about $600.
I am going to keep this car maintained and save enough money to buy an Audi A4 that’s 3-4 years old and has under 60,000 miles for $12,000-13,000 when I have the cash in my checking account in the next 18-24 months. When I buy my next car, I want to sell this Saab for a $1,000.
I never want a car payment again. Most car payments are over $400 a month and extend beyond 60 months. And for what? Most people never keep their cars that long, than the negative equity goes into your new car payment, making the payment and or contract length longer.
My 1995 Saab is a fun sports car to drive. Even if it costs $2,000 in maintenance and repairs a year, that’s fine. I own this car. A repo man will not show up to take this car away from me if I lose my job. My auto insurance dropped from $1,500 a year to $278 (liablity only) with an older car.
With the money I save I can apply that toward a better future which includes traveling, more money to go out and have fun with friends, saving money to open a business, and most importantly no car payment.
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Back in 2006 I purchased a 1989 Buick LeSabre from an 92 year old lady going into a nursing home. The vehicle had 24,000 original miles and was like going back in time a buying a new car. I gave $1100 dollars for the car. Have replaced the alternator so far. The car now has 53000 miles on it and I venture to say I could get at least what I paid for it. But I plan to keep it for now.
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I’m grateful to have stumbled upon this article and these posts because I’m torn over whether I should buy a new-to-me car.
I just turned 31 and have never owned a car. Since I was 16 my mom has supplied me with cars. Pathetic, I know, but I’m an only child and my mom is generous. I’ve only worked part-time for most of the last 13 years because I’m a career university student–I’ll soon earn my Ph.D.
My mom grew up in a middle-class but incredibly frugal household. It was practically a sin in her family to buy a new car. It was too expensive and too wasteful.
She held onto those values and has only bought used cars for which she paid cash. The most expensive vehicle she’s ever owned is the $4,600 1997 minivan she bought in 2004. I drive the van while she drives a beat-up 1989 Toyota. She had no problem affording the van but was sweating bullets for spending a whopping $4,600. She thought it was SO extravagant.
Right now I have car lust like you wouldn’t believe. I’ve never wanted a brand new car, but would love to have a newer car of my choice. I spend a lot of time online researching what’s out there, looking at photos, and dreaming away. How I’d love a shiny new sedan with a sunroof. ::sigh::
I’ve now been working full-time for a year and could afford a nice used car, but don’t have much money saved and am terrified to finance something. I don’t like owing money. On top of that, I’ve been so engrained with not going into debt to buy cars that I feel guilty thinking about taking out a loan to get a vehicle.
Reading the article here helped me realize I’m being greedy in wanting some new wheels and that saving money on cars is something to be proud of.
I don’t NEED a new car, I just WANT one, and that’s not a good enough reason to put myself into debt and to waste my hard-earned money. I just need to keep working and keep saving. By the time I have a nice chunk of change saved, I likely WILL need another car because the van will have putzed out on me. Then I won’t feel bad for making a purchase.
Growing up, I was always embarrassed by the cars my mom drove because they were so old. In my late teens I finally realized she had very sound reasons for buying used cars and driving them until they died. She’s been financially wise.
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All the cars my family owns cost us less than 1000 dollars each and all were bought in the last 6 years. They are not built for vanity or as a fashion statement, the cars get us from point A to point B. A mid 1980′s caprice, crown vic, and lincoln. We don’t owe anybody anything. In a economy where people have $2000 house payments each month not to mention the car payments on a newer vehicle, its a good feeling.
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Totally agree with the article. I purchased a brand new Toyota Camry in 1988. I am still driving it 21 years later. I have never spent $ 1000.00 in repairs in any year. It has served me well. The car started to leak oil from the rear seal so may have a few more years from it. I cannot recharge air-conditioner because it uses Freon. AC still works but does not cool very well when temperatures get to 95 or 100 degrees.
A funny incident — my younger son took it to school after he got his license. his friends made fun of him as the car was older than him. Next day one of the guys asked him for a ride home — my son said — “wait – what do you drive”!!
Let’s see how long it lasts.
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I totally agree with this article. I currently purchased a 2007 chevy cobalt coupe brand new and paid it off in 1.5 years. I just got so tired of seeing the interested every month that i was paying and would never get back. I now have 33k miles on it and plan on driving it another 5 years or more and when i decide to buy another vehicle, it will be used this time around. Its funny that all my friends all drive way better cars than me but I am the one always with money. At 29 years old, i am saving around $1800/month and have no debt and just live in a single apartment. Its funny because i will go to the mall and see a brand new suburban (50k+) to purchase and it has door dings, dirty and don’t even look like its taken care of.
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My 1995 Saab 900 SE convertible has exceeded my expectations. I paid $800 for the car in March 2009. The car has 166,000 miles; and has been in southern California all of its life. Between new tires a couple of oil changes, brake pads, a smog check, and registration fees, I have paid another $800 on the car. Sure the car has some dents, scratches, and a couple of tears in the leather seats, but it is better than having a car payment. When I had my 2003 Mercedes E320 before this, I was paying $634 a month. I would never do that again. I just hope my Saab will last another two years so I can buy a 3 series BMW with cash (in the $15,000 range and under 5 years of age).
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I had a 1991 VW fox for 9 years and it literally paid for itself. I was fortunate to get it very cheap at an auto auction fixed it up and it was totaled out for 2x what I originally paid for it. I loved that old car and its still driving around town. Part of me wants to buy it back even though its in even worse shape than when I let the tow truck take it away.
I have some friends that have bought new cars and honestly they can afford it so why not get what you want? I mean someone has to buy those new cars. I don’t think I could ever buy a new car though it just seems too much money. Then again I just can’t afford to pay for a new car when I can get a barely used one for so much less.
As for safety its a consideration, but some cars are in accidents more because of the people who tend to drive them. A 95 geo prizm is more likely to be driven by a young person that is more likely to have an accident than a full-sized or mid-sized whatever. Besides some of the newer cars aren’t safer than old cars. I was always annoyed after considering safety that our Ford Focus didn’t have rear headrests and it was pretty new 2003. Our 2007 Hyundai Elantra was rated very well in crash tests and it was an added bonus after the Focus was in 2 accidents and the second one was a too friendly deer. I would say if there is one reason to get a bit newer car it would be for safety, but don’t just assume that because its newer its safer just do your homework. Also no matter what car you have making sure its maintained which is a big way to make sure you are safe.
Since my VW was totaled about 3 years ago I have driving cheap beater cars. My current one has been the best and longest I have had since. Its 1991 Mazda 626 dx so no power windows or locks and 5-speed. I have done some work to it myself and even though I keep looking to upgrade it (because I get bored and liek to look on craigslist) I have a hard time doing so. It runs great the interior is in great shape for a 1991 and I never get less than 25 mpg which is nice for a mid-sized car. With the 5-speed its more fun to drive than the Elantra and it is comfy too.
For people who can’t or are not willing to work on their own cars driving a beater might not pay off since repairs can cost too much although I don’t think my repairs would have cost too much at a shop with reasonable prices. Basically since I have had it its averaged $25 in repair each month and that includes some used tires I have put on it. Some people have asked why I have an old car and honestly right now it would be hard to afford a much nicer car since I only work part-time, but realistically I really like this one and since now I probably won’t drive much more than 3,000 a year I see no reason to up grade it for a couple of years. Besides if it dies I can get a few bucks for it and get another car for $500-$1,000 depending on how much I care about how it looks. The Mazda I drive now is far from junky looking though IMO.
Since I have liability only (I have good coverage for medical etc.) I save almost $400 a year plus it cost less to license each year and I can work on it myself. Older cars are often easier to work on. I paid $850 for this car, but I got a good deal because it came from a newly graduated mechanic that had done a ton of work on it for class. He had bought it from his best friend’s parents and so I have lot of the maintinence records. In the 1st year I had it I put 11,000 miles on it most of them in town miles. It was basically a taxi. LOL You hear it all the time, but really look for a car thats been well maintained and doesn’t need tons of work. I paid a bit more for this car (I know $850 doesn’t sound like alot, but I have bought and looked at some cheap cars) because it was taken care of and its one reason I haven’t sold it yet. It doesn’t need anything. AC is perfect, it has new speakers a stereo that works (alot of them are ripped out at that price) and some alloy wheels that I got off of a salvaged 97 626. I am also just under 2,000 miles till I will give the Mazda a party when I roll over the odometer at 200,000. I wouldn’t be shocked to see this car still ont he road 5+ years from now. Rust is its only enemy, but I might fix that too since I know how to do some body work.
Basically what I saw one previous post say “Buy the best car you can afford” Thats a good principle to use. Thats what we did with our Elantra and hopefully we can get 10+ years of use out of it. I expect to get at least 7 years out of it as our primary car. It should be paid for in a few months and then we can continue saving towards the next car purchase. We already put aside money for repairs or maintenance. Unless we have some major financial crisis we plan to never have to finance a car again.
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My wife tells me that i’m too cheap, couse i refuse to buy a new car, i’m still driving my old Bimmer with over 250K miles on it. But my car actually looks and run’s like new no breakdowns no rattles, no electrical issues, paint is shiny, interior is in top shape i actually receive complements from time to time. People tell me i’m crazy driving such beautiful classic on a daily basis. A nice car is like a beautiful woman to be seen with. Why will i leave my nice ride sitting in the garage and drive an econobox. That will be silly or just plain stupid. But the biggest advantage is being payment free, it’s glorious not to have to sent my money to some finance company every month not to mention that the insurance on a newer car is a wallet killer also the registration especially here in Cali just went up like 60%. By the way my car is a worry free machine well almost. Thipycal expenses include Oil changes, well just basic maintenance, by the way i use pure synthetic oil pricy maybe but i do my own routine maintenance. Also my tranny is manual. For those of you who ignore the real benefit of a manual tranny. It outlast the car itself.
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Kudos to the Prizm King! Smart thinking and doing. We have a 1997 Prizm. We paid cash for it. Our first Prizm was a ’91. Our daughter bought one in ’95. We bought our current 1997 Prizm in 1996; paid cash for it. We had sold our ’91 to our son, who drove for 8 years. We have gone 14 yrs without a car payment and have only bought 2 batteries and one set of tires. The GEO Prizm (actually a Corolla) is a highly cost effective value machine for minimizing costs and maximizing your ability to save. Your post is great and so is your thought process.
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Wow. I am amazed everytime I see an article like this.
Drive your Geo Prism, retire rich, leave millions behind and let your next of kin enjoy them. That is, if they also inherit the good sense to enjoy their lives before they are referred to as “old.”
You’ve missed out on life my friend. It is a not a deprivation contest where the winner has the highest money-to-wrinkle ratio.
You only have one, short life. Make yourself happy. Buying things is okay, really, as long as it’s not extravagant.
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I love these posts!
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What SO many people don’t get is RICH people always pay CASH and they ALWAYS buy USED cars, Houses, Rental Properties, etc… They may buy a Porsche or a Mercedes or whatever but they buy it USED and for 1/2 the book value AND they pay CASH for it.
WHY?? Because you get SUCH a great deal if you pay CASH for your cars and buy slightly USED.
NO RICH PERSON would EVER, EVER, EVER, buy full price because that would make you look like a FOOL to everyone you know. Rich people BRAG about the deals they get by paying cash for cars, houses, etc.
Cash is KING, always has been… ALWAYS will be.
Welcome to 2010, where DEBT IS BAD again.
Guess what… Your GRANDPARENTS were RIGHT.
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It’s always smart to drive cars into the ground and not have a car payments. But IF…..and I mean IF….you’re a car enthusiast and can afford a $400/mo payment on a $35K car and don’t mind the payments, then I can understand someone driving a nice sports car too.
Some people would rather spend the bucks than drive around a 10+ yr old Prizm.
But the smart/frugal…..if not fun, way to do it is to keep your car.
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98 metro 3 cylinder, 50,000 miles; 94 saturn sl2 84,000 miles. Guess we’re keeping them until the kids start driving… prizm is the geo’d toyota corolla, so you’d expect it to last; the metro is a suzuki swift. Real rule seems to be “buy old simple Japanese cars”
Had a 79 Corolla and 78 Corona I ran before these
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I couldn’t agree more. I’ve just had to give up on my little 1987 Holden Barina i bought in 2002 for $1,200. The car chugged and putted a bit, but was a wholey reliable car, and cost me very little in fuel or repairs. I’ve now driven it into the ground, and don’t need it anymore, cause i’m planning to do the same with my ’94 honda civic i bought for 6K.
I would never take out a loan for a car. I’m only going to be in debt for something that will make me money. And a car is a liability, not an asset – it costs you money.
Thanks for the great article
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Just don’t buy something too old. My wife and I were looking for something cheap back in September to get us through a couple years. She got to pick it out, and decided on a 2000 Olds Alero. We have had nothing BUT problems with this car. Fortunately, I am in the automotive aftermarket industry, or else the repairs would have TRIPLED the $3000 originally spent on the car.
However, my 2003 Ford Taurus that I bought in 2006 still runs like a dream.
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I drive a 97 Ford Taurus that I also intend to drive into the ground. It’s been paid off since 2003, and cost me $3500 at the time, had only one previous owner in pristine shape. I’ve put less than $2000 into it, and most of that is stuff you have to do anyway; change tires, new battery, etc. I’m amazed even as I write this that I’ve had it for so long and got it so cheap! It has a lot of cosmetic damage (a few oops! since I’ve had the car) and people always say “you could afford a new car, why don’t you get something not all banged up?”. Eh, its a hunk of metal that takes me from point a to point b.
I agree with the comments about walking, cycling, public transport, etc. However, people have to think about logistics. If I lived in New York, I’d take public transport. I live in Lincoln, Neb. Everything is so spread out here, you almost have to drive. Our public transport isn’t great and there are hardly any bike lanes and its not very safe to bike downtown, not a lot of sidewalk, etc. I went to Munich and was amazed at how bike friendly the city was! It’s just not always feasible here.
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Thanks for this great post. I have a 19 year old Ford Ranger and I love it.
This blog inspired me to write a post about it on my site.
http://www.trulysimple.com/
thanks again
Ben…
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I had bought my first car in 1984 and driven 200k kms. It was a small car of 3 cylinder 800cc but very smart. I now own a 1000 cc 4 cylinder small car of 1997. Have no problem though without air conditioning. I have no plan to buy a new car unlike my people around me but i do not care much about what others feel about this. My feeling after driving 26 years on four wheels(before that I drove 2 wheels for 5 years)that idea of a car is mostly imaginary than real.
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I agree with you Sam.
Although I had no time to read through the whole discussion, but I drive my 1991 FIAT in Hungary, and I can say that if you don’t need your car for emergency usage, or travelling hundreds/thousands of miles, you can get along with even such an old car. Preventive service should be regular (every half, or quarter year). Of course it’s a different feeling to drive a new car, but this can be said vice-versa too
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I drive a 1990 Ford Tempo (190k miles) and a 1986 Subaru (263k). Both are still running well. Of course, each has needed some repairs now and then, but since I am a farmer I do all my own car repairs—another skill to have if you really want to save money on cars.
I just can’t believe how people can afford these new cars. I see these Ford F150 pickups in the dealer lot with $35k price tags. How on earth can people afford it? And then the high insurance and taxes to go with it!
Another piece of advice: keep your old car for daily trips. For vacations and the occasional long distance drive, rent a car instead. It’s far cheaper then buying a new car.
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I think most people have an irrational fear of old vehicles. Automatically a lot of folks assume an old vehicle will break at the drop of a hat. I drove a 77 Ford for 7 years. I bought it for 300 bucks. Over the years I stuck 150 bucks for a new clutch, 100 bucks for a transmission (old one had 250,000 miles), 50 bucks for a new coil and computer, and probably another 100 bucks in misc. repairs. So all together it costed me a whopping 400 bucks to keep it on the road. I even put on free tires on it. My cost for the entire 7 years is less than what most people spend on a car payment and insurance for one month. I finally quit driving it when it was hit by a semi this year. It wasn’t unreliable, I was never late to work because of the truck, it started when it was 20 below zero without being plugged in, and parts were dirt cheap. Being an American truck the body held out okay, if it was a Toyota of the same vintage I suspect there would have been nothing left to drive about 20 years ago.
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Every discussion always have “Yes” and “No” sides. I think this is very important that where is your position are? With a family, I believe 80% of them are prefer to have a new safety family car (including myself) rather than saving, but I am driving a Toyota Corolla 95 – (paid off one payment) for 15 years. Recently, I bought a Mazda family size car year 2004 – (also paid off one payment). The reasons for me to keep drive my Toyota, it is my first car. I have been gone through too much experience with her. e.g. working – delivery, going to country side, enjoy all whole family together…etc…. Second bigger reason is I can not afford to pay off a new car in one time (and other word – they are expense). In fact, the true is not about all reasons above, it is because whether, I can get a cheaper car or not. If the new car, it is very much standard price. Old car always can bargain. If people could find new modern car and cheap like old car. I believe they would all definitely go for it without thought. The point is not about saving, is all about how economic deal with the car. Because the worst scenario is just sell the car and get back money (if lucky, can get extra like dealer).
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Yep. I’ve got a 93 olds 88 royale that I bought for $600. I’ve driven it for the last 5 years with minimal repairs. With purchase, repairs, tax, and insurance this car has cost me $60 a month.
I just replaced my back-up car which was a 2000 pontiac grand prix with a second 93 olds 88 royale that I bought for $1300 (it was in MUCH better condition than my first one and had much less mileage).
I will probably drive this $2000 worth of car for the next 30 years, or until I feel I’ve saved up enough money that I want to waste some on a prettier car. And it’s a simple enough car that I can do the repairs myself which saves a lot of money.
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Proud bmw owner for past 8 years. these cars are tough even if you run with low oil, dirt roads, high rpms etc. I bought a 1994 bmw 325is in 2003 for $6400 and spent a $1000 on tires, clutch, and power steering lines. It’s still going strong but there are a few rust spots easily fixed for %50. bubbling near fuel cap and door handle.
I have another 1995 subaru that I am going to scrap. Both cars have 200 k miles on them but the subaru after changing the struts and bearing has cost over $1500 in the past year.
I am expecting a baby and both cars are too small and leak oil and have minor issues making them difficult to certify but I would trust them more than a car used even a 5 year old car with under 60 k miles.
Cars are built much worse, rust much quicker than cars made in the 90s. And old cars still have airbags, abs, and less plastic parts that only deteriorate like the water pump and housing and bushings.
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Good site I drive a 93 405 pug Paid cash for it in 2004 it had 78000klm on the clock I was the third owner Car now has 277000klm on the clock Still drives fine Do most of the maintance work myself anything major have a good local workshop To keep costs down buy second hand parts ie power window motors themo fans bits of trim thats cracked or broken usually half price or a new parts Only major eexpense blowen head gasket Got the head reco car does not burn any oil now spent $1000.00 Aussie dollors plan to keep the car for long as I can Cheers
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I’m a bit late in reading this, but I’m glad I found this article/blog.
Everything was well said and written. I also applaud the comments advocating this article…
I’ve always been a firm believer of not letting ego get in the way. There are people out there with an ego higher than reality, and are completely over their heads… Some thinks that their car is what defines “them”, so they try to portray success by trying to keep up with the latest and greatest – DEBT!
Pathetic is what I call it!
I know people driving brand new BMW’s and Infinity’s, with jobs making $25k – $30k a year. That’s insane!
I’m in Sales and make up to $60,000 each year. While that’s not considered well-off, it’s also not bad – heck it’s decent. My car is a 1996 Honda. It drives excellent, and in great condition inside and out.
I know there are folks out there that no matter what, their ego gets in the way – to a point that they’ll refuse all the benefits of an older car. They even talk down on those who think otherwise.
But hey, to each his own!
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Im 24, I can afford a 1996 2000 or even a 2004 large ford sedan or similar, but i choose not to, im perfectly happy with my 1984 ford panal van, its rust free, and Damn cheap to repair. For instance i can buy a fully refurbished engine for 400 plus labor, I like cars with simple basic engines, none of this computer or electronic crap, my last car was a 2006 Mitsubishi which loved the fuel but was costly to repair, As for safety well i have had airbags and a modern dash installed. all up every year i spend about 200 to 400 on maintenance, its easy to maintain and keep roadworthy.
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Bravo Old Car lovers.
Own Volvo 940 91 and Volvo 760 88.
Perfect safety (recently was involved in the accident with new Dodge Caravan. Now I am absolutely sure in my Volvo )! Perfect comfort!
All features of new car (all power options, climate control and etc.) Extremely reliable.
Never change it to new gunk!
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