# Why I drive a 13-year-old car

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 Jami Dwyer.

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### There are 282 comments to "Why I drive a 13-year-old car".

1. Miranda says 21 January 2009 at 05:24

Great post! If there’s something that you don’t need to buy new, and to replace regularly, it’s your car. We’re seven years into the ownership of the car we bought when we first married. We use public transit and planning so that we have only one car (I know at some point we’ll have to get another one), and we’re hoping to keep driving our current car for another few years. We love that we have it paid off, and we love that the insurance on it is cheap.

2. Ryan2 says 21 January 2009 at 05:26
Your plan is solid. Drive it as long as you can, keep costs to a minimum. Basically, squeeze the most value possible out of your resources. So I wholeheartedly agree with you, and I applaud your effort.

But your accounting is fuzzy, at best. By dispatching your car payment of \$250 monthly after four years, you are now “saving” \$250 monthly indefinitely? What if you had only financed the ’95 Prism for one year instead of four? Then your monthly payments would have been close to \$1000; let’s say \$10,000 for the year. And you would have paid it off by 1996, right, so that’s 13 years ago, let’s see, carry the one…if you had just financed this for one year instead of four, by your logic you would have now “saved” \$130,000 instead of \$27,000. You can take this anywhere, and that’s the problem, it’s nonsensical.

The only way to do this is to do a basic accounting analysis starting with your capital investment (the initial cost of the car), its depreciation, and its current or salvage value. Yes, you should factor in the cost of carrying the debt to pay for the car, but don’t get too fancy.

If that’s too complicated, then just do this. How much did you pay for the car? How much is it worth now? The difference is your depreciation. That’s one cost. Now add up all your other costs (fuel, insurance, maintenance). Now you have your total costs. You can divide that by years of service (cost per year) or by miles driven (cost per mile).

If you compare it to a more expensive car, or a car that you would replace every two or three years, then absolutely, by all means, you’re saving a ton of money. But not really based on the way you wrote.

I’m not trying to be harsh, but the point of these sites is to make personal finances clear and understandable. Americans who are not necessarily strong at math are bombarded with this kind of fuzzy accounting by marketers (working in the other direction) all the time.

It’s important to understand how to account correctly.

Personally, I agree with all your principles. We’ve got two six year old cars that better have at least that same amount of life left in them.

3. Jason says 21 January 2009 at 05:30

Don’t forget however that the repairs you are making for your old car are a sunk cost. On the other hand the monthly payments you will make for the new car are building equity (even though new cars depreciate very fast), so the equation isn’t as cut and dried as you might think.

4. Jamie says 21 January 2009 at 05:32

You are very lucky though to only have put in \$2000 in repairs. I had a 1998 Saturn SW1 that last year alone I put in \$2000 in repairs. This plan works depending on the car. If you have a car that is and will be dependable it works. If your car costs more in repairs it does not work. The \$2000 I spent in repairs is about \$166.67/month not to mention the time cost of going to the repair shop.

5. Jeff says 21 January 2009 at 05:34

JD,

About 2 years ago, I got my first real “career-break” and landed a job where I was being paid relatively well compared to what I had previously been earning. The job was a good 45 miles away, though (but with zero traffic). After 2 months at that job my ’94 Mazda Protege gave out on me. It was going to cost about \$800 in P&L to get her up on her feet again. I was faced with a decision – patch up the dented, rusting and ugly-looking (though I loved her dearly) Protege or get a new car…well like yourself, I had been wanting a MINI Cooper for a VERY long time. I decided to do it, and found a pre-owned 2006 which had only been slightly used (had like 4k miles on it) and made the purchase.

In retrospect, it was a very, very unwise thing for me to do from a money-perspective. I could afford the payments, but I was still ~10k in debt between student loans and CC bills and I had absolutely no emergency fund to speak of.

Luckily for me, I landed an even better job later that year and I was able to pay off the whole vehicle in a few months. Though I consider my personal finance “smarts” mucher higher now than it was back then, I would still do the whole thing all over again, even not knowing that I would be able to pay it off so quickly. And I’ll tell you why…

I love my MINI. 🙂

6. Leslie says 21 January 2009 at 05:35

I am following the same sort of plan. Our cars are considerably younger than the Geo Prizm (2004 and 2005) but they are both paid off and we intend to drive them until the fall apart beneath us. When the second car was paid off, we started putting the same amount we paid on the car payment every month into and ING account. That money is for a down payment someday but it is also to be used for any repair bills that come up. Not regular maintenance like oil changes etc. but for bigger, unexpected things.

The only thing I am somewhat worried about is because both cars are a similar age that we will have to replace them at the same time (or close to it). My hope is that we will be able to pay cash for at least one of them or at the very least have a significant down payment for both. Hopefully I won’t have to worry about that for quite some time though.

7. Eber says 21 January 2009 at 05:36

here in Brazil things are a little more complicated. you buy a new car for like 10.000 dollars and after 10 years it is still worth 60% of that amount.

this happens because most people dont have money to buy new cars, so the used ones have great value.

i have a 1995 chevrolet vectra cd, which is worth some 6.000 dollars.

crazy, isnt it?

at least the good about used cars here is that most people dont have insurance on it. i dont. and the annual tax over cars is like 4% of its value. less tax too.

and my car has a 2 liter engine, air-conditioner, all whistles and bells, stuff that new and cheap cars dont even dream of having.

ah yes, i was almost forgetting: here we dont have the habit of leasing cars and be paying them every month for all our lives. people who have more money do that, but most people buy used cars, either cash or financed, and then keep them for several years. we dont put car payments as a monthly expense.

8. PrizmPimp says 21 January 2009 at 05:38

I’ve driven a 98 prizm for 7 years and recently graduated college with a well paying engineering job. All my friends are buying new cars and laughing that I’m still with the Prizm. I couldn’t care less since I’m saving so much. I took it in stride and created the PrizmPimp screename as a joke.

Good choice on the Prizm, it’s such a reliable car. Aside from tires and oil, my repairs have probably only averaged \$300 a year with the exception of one year when I spent \$1000.

9. the weakonomist says 21 January 2009 at 05:46

I bought a brand new honda accord last year after driving my 93 camry into the ground (225k miles). I’ve already paid it off and plan to drive this one into the ground too.

Oh and if you’re worried I overpaid for a new car, don’t. I was well below invoice and for the first 6 months I could have resold the car for a profit at private sale.

10. Scott NJ DAD says 21 January 2009 at 05:50

Our cars are 10 and 22 years old, we can easily afford new ones, but don’t because the ones we have are perfectly sufficient. The 22 yr old car, ferries my wife back and forth from the train station, and the 10 year old car does the rest. On top of the savings, driving older cars is incredibly green. The manufacture of cars uses vast amounts of fossil fuels. The cost of replacement parts was a tiny fraction of that.

Alas the 10 year old car is getting less reliable, and we feel it is time to buy a new one. But I feel like a new car every 10 years is pretty reasonable.

PS We will probably keep all 3 cars. Put the newest car in the garage for family time and long trips, Give me wife the 10 year old sedan for trips to the station, and I keep the 22 yr old car for daily things around town. That might enable us to get 12-15 years on the new car!

11. Chris G. says 21 January 2009 at 05:53

My wife and I are following this philosophy now too.

We are still paying off my 2002 Subaru Forester we bought used in 2006 (about \$5600 left on that loan), but we are about to switch our debt snowball to that loan with the goal of paying it off this year.

My wife’s car just died (a 1997 Dodge Neon that we road into the ground), but my grandparents decided to give us their 1993 Saab 900S Convertible that had been in storage for over a year. It has 160k on it, but is free and it runs great. Needs a few things here and there, but for a 16-year-old car, it is in amazing shape.

My goal after the Subaru is to never have a car payment again. After this, its monthly payment goes into the debt snowball to pay off our student loans.

12. Jean says 21 January 2009 at 05:54

Yep. That’s why I drive my 1995 Geo Metro. It’s mine, it’s paid for, and it runs fine. That’s all it needs to do. I’ll drive it until it falls apart.

• Clifton says 24 July 2011 at 20:45

Yep, Joel and Jean.

After exhaustive research online in May 2008 for a car that was cheap to: buy, fuel, insure, repair, and, well, cheap on medical bills (i.e., safe), I found my own 1994 Geo Metro on ebay.

I get a ridiculous 50 MPG, use it mostly for groceries and gas but also semi-annual trips to VA to see family (from NC, about 250 miles one way–exactly one 10-gallon tank of gas!), and have paid only for regular oil changes and tuneups, a new battery, and \$450 for new head gasket and master cylinder (obviously also shopped around for that price on parts and labor!)

And yeah, she’s small, but a hatchback; with the back seat down, I’ve moved some pretty major furniture–have even sleep back there a couple of times.

ALWAYS, check the CarFax and spring \$100 for a certified pre-purchase inspection.

And haggle(!). Final price to buy Gaia (Greek Goddess of Mother Earth because of the 50 MPG)?

\$2500, well below invoice for a car in excellent condition.

I love Gaia as much as I would ever allow myself to love any physical object; best car I’ve ever owned or could hope to!

Happy Wheeling, y’all.

13. Brett Legree says 21 January 2009 at 05:57

I agree with keeping a car past the end of payments – to a point.

If I’m going to drive a 20-year old car, it is most certainly *not* going to be a domestic econobox.

As a husband and father of four children, safety is sometimes more important than saving money, so I’m willing to pay a wee bit more for maintenance on a larger car with a better safety record.

(e.g. a previously enjoyed Accord or Camry)

14. EscapeVelocity says 21 January 2009 at 05:58

I drive a 13-year-old car, too (it’s a ’96 model, but it was manufactured in November 1995). The way I see it, when you buy a car, you might get a good one and you might get a lemon, but when you have 170,000 miles on a car, you know you have a good one.

15. christy says 21 January 2009 at 06:00

I LOLed at the lack of “new car smell” comment.

Here’s a (currently) unquantifiable benefit to driving your old car:

The “new car smell” is actually the off-gassing of VOCs (volatile organic compounds). These are bad for your health. Some VOCs are thought to trigger cancer.

So by driving a car that’s done off-gassing, you’re saving your body too. 🙂

16. Kevin says 21 January 2009 at 06:05

@Ryan2 – excellent points, thank you.

I agree with the post wholeheartedly except for one issue which isn’t mentioned directly: it partly depends upon where you live and to a degree, your family situation. If my wife were still in her 30’s and was carting our two young sons around, I would not feel comfortable with her in a 13 year old car driving down I-80 in the middle of Nebraska. In the winter.

Other than that, of course it makes sense to hang onto older vehicles and get your money out of them. But when the car’s proclivity for breaking down exceeds your tolerance for risk, you may want to consider a late model used replacement.

Good post.

17. Irving Isler says 21 January 2009 at 06:08

Buying used is also the way to go as well. Two years (especially cars just off a short lease) can be some of the best deals around.

A car depreciates (depending who’s doing the talking I imagine) around 30% in the first two years. So just rolling a new car off the lot as the first owner costs you about 15% of the sale price.

Two year old cars are generally still fully covered under warranty (except the new 2-year Tesla bandwagon others might jump in on), and if you can find one with low KMs (say about 16 000KM or 10 000 miles per year) you can get a real winner of a car. I won’t talk to much about our – but do your research!

We saved about \$10,000 buying our used car and nothing other than regular maintenance (oil + brakes + regular checkups).

On the flip side, this gem of a car I’ve been going on and on about replaces another used car that was the opposite.

Bought at 13 years of age, it was a cheap Camry. It was a money pit. By the time I’d sunk my first \$3000 into it, I had tricked myself into thinking that every problem thereafter was the last. I got rid of it for a huge loss. In that particular case, a \$250 investment (or less) in a mechanic looking the car over pre-purchase would have been the investment to make.

Still, I do love me the automobile even if both my wife and I mostly use our legs and public transit now.

18. April Dykman says 21 January 2009 at 06:09

Our car was bought used in 2005 (it’s a 2003), and we paid it off last year. We’re now saving cash for repairs and/or the day we may need a second vehicle.

When my husband’s truck was rear-ended and totaled, we decided not to buy a second vechile just yet, which has saved us a ton of money. It’s not always an easy arrangment b/c we don’t live near public transit routes, but it’s been worth the effort.

19. J.D. says 21 January 2009 at 06:11

I may not have time at the moment to write articles, but I can squeeze in a few minutes to leave a comment.

As I mentioned at the end of this post, although I do very much want a Mini Cooper, I’m satisfied to drive my Focus into the ground. I bought it new on 08 December 2000. It’s got a ways to go, I’m sure. (I hope.)

My wife is doing the same with her car, too. She has a 1996 Honda Civic (with only 60,000 miles on it!). She wants a new Prius. But she, too, is content to continue driving her vehicle until it runs no more.

Right now, I figure about \$1000 a year for maintenance on the Focus. That’s a lot, but it’s less than what it would cost to buy a new car. And the thing is, since I’ve been working from home, my driving has declined significantly. I’m driving about 500 miles per month!

All the same, if I manage to obtain some sort of windfall, I just might by a Mini…

20. Josh Baugher says 21 January 2009 at 06:12

This plan only has one loophole I can think of: safety. Safety features have improved since 1995. How can one only consider monies saved when safety is involved?

21. Stephanie says 21 January 2009 at 06:13

I love this article. I’m 23-years-old and drive an eight/nine-year-old car (a year 2000 model, which I don’t consider old) that I bought used in 2006. I plan to drive it until it falls apart. I get disgusted when I see my friends who, like me, are starting their first real jobs out of college, and who are buying new cars “because they deserve it” – like graduating college is such a hardship (get over yourselves…) that the only way to reward yourselves is to put yourself into debt, paying off a car you can’t afford.

22. JM says 21 January 2009 at 06:15

I learned two things about cars from a friend who was an investment advisor:

1) Most of his \$1 million (and up) net worth clients drove to his office in old cars. Some were beaters.

2) “The only thing that depreciates faster than a car is food.”

This is why I drive a 1997 Honda CR-V with over 127K miles. I hear Chad sitting on my shoulder talking me down whenever I visit edmunds.com.

23. The Happy Rock says 21 January 2009 at 06:17

I am right with you as I have a long since paid off 1994 Sentra that is quite a spectacle to look at, but continues to run without any repairs. I only paid 5k for it 7 years ago. We have two children and the two door and very small nature of it are an inconvenience, but how really cares. I have bigger dreams and things to focus my energy on.

We have 3k-5k saved for a new used car whenever it should go.

Somehow I take solace and pride in the fact that I drive a junker. It also helps curb materialism!

24. Phil says 21 January 2009 at 06:23

Great post! I drive a ’92 Sunbird and as a 26 year old I get a lot of looks from my peers who ask me “why not buy a new car,” to which I respond much the same as you did.

I also work with teenagers…who thought it was kind of lame until they got to know the why behind it. Now they think it’s cool because it’s “retro.”

I have money to buy a “new” car (Read: used, but new to me) but will wait a few more years to see what I can get out of my Sunbird.

On the whole, the less you rotate through cars the better (unless you get an occassional lemon).

25. SFB says 21 January 2009 at 06:25

We do it slightly differently in our family.

We keep one nice car (a Mercedes) and use it when we go on trips, want to be comfortable, etc.

For the daily stuff, my wife drives a 5 year old Toyota Corolla that is still in excellent shape and probably has at least another 3 to 5 years on it.

Maintenance has been less than \$1,000 per year, BUT I’m expecting that I’ll have to probably put in more than that over the next few years (but it’s still worth it).

SO, we have an every day car that my wife can drive (which she loves) AND we have a nice car to use for business and pleasure . . .

Plus, once every year or two my business requires me to do a cross country driving trip (about 10,000 miles or more), so it’s nice to do so in a VERY comfortable car.

26. Miss M says 21 January 2009 at 06:28

I drove my first car, a plymouth neon, for 10 years. I’m amazed your maintenance costs were so low, mine on that little car were definitely higher. Lots of little things broke and I finally got tired of all the problems. I then bought way too much car! I finally paid that off this year and I hope to drive this car another 10 years. It will be great for when we have kids, has all the safety features and still makes me smile. Buying a car that you will be happy with for years is part of that equation.

27. real money says 21 January 2009 at 06:32

There is a guy I work with who is a really cheap guy. Not frugal but cheap. For me frugal = good. Cheap = bad. He has a 95 Honda accord, which is starting to break down on him. His windshield cracked and it cost him \$800 because he has to get some rust around the window fixed first. I have trouble investing \$800 in a car that is probable worth \$50. I told him to get rid of the car then. Well the next week his break lines went. Guess what I told him. After he spent just over a thousand dollars fixing that. The engine started making a bad sound and it quite on him. I am not sure what it cost him to fix. Oh he also had new breaks put on it.

Now let’s say that nothing else goes wrong with the car. Can you put a price on his life? What is your life worth? It was one thing after another. Can you trust a car like that? He makes really good money 6 figures. He lives for free with his brother. He has been making the 6 figures for 8 years now. Never lived on his own. I don’t think that he has ever paid rent. I think that he is 43. Anyway’s I am all up for saving money. My last car was held together with rust but I trusted the car. As soon as I thought it was not safe I ditched it. My Life and my families lives are worth way more then the cost of a new car. That is just my two cents. There is a time and a place to save, but not when your life could be at risk.

Just a thought.

28. J says 21 January 2009 at 06:34

This post is pretty relevant to me. I have a ’01 Nissan Maxima with 180k miles on it. These things seem to run forever, and at this point, I might as well run it until it dies, since the resale value is pretty much nil.

The plan is to save money now so we have \$10-\$15k banked up when we do need a replacement car. Trying to avoid payments at all costs!

29. John says 21 January 2009 at 06:39

Good idea and inspiring, but as Ryan2 (above) posted, unfortunately, the calculations don’t make much sense.

When you buy a car, it is worth some amount of money initially, and then depreciates over time with use. So each year that you have it, you’re “saving” less money, because you can only “save” the value of your car. Once it’s worth practically nothing (i.e. only scrap), you save nothing. And in fact, it may actually cost you money, because of upkeep expenses.

The calculation that you need to do is: how much did I initially spend, how much has the car depreciated, how much can I sell it for now, how much does it cost for upkeep, and how much will it cost me to replace it.

As Ryan2 pointed out, it’s important not to get confused by the numbers.

30. kelle says 21 January 2009 at 06:42

We have two beaters, a 1991 Chevy and a 1995 Honda (40 mpg), both pass the 240,000 mark. Even though they both were running fine, we took them to a local mechanic for a maintence workover this past summer.
We have the cash to, but never have and never will buy new.

31. Gunnar Tveiten says 21 January 2009 at 06:44

That’s a AMAZINGLY silly way of calculating the cost of a car. There is no direct relation between the cost of a car and the payments.

The correct way is to say that the cost of a car is equal to value-loss, plus repairs. So a new car will generally have a larger value-loss, but less repairs.

A new \$20K car can easily lose 20% of it’s value in the first year, or \$4K, which makes it expensive, even if has zero repairs needed.

The most inexpensive car to drive, is the one where the sum of value-loss and repairs is the lowest possible. That’s hard to know beforehand — you can get lucky and have a \$3K car work for a year with zero repairs, or you can get unlucky and buy a \$20K car that nevertheless requires significant repairs.

What is certain is that the first 2-3 years are expensive. Buying a 3 year old car and driving it until it’s 13 is almost certainly going to be better than buying a new car and driving it until it’s 10.

On the other hand, buying a 15 year old car and driving it for the next 10 years probably isn’t a smart idea, quite likely the repairs will cost more than you save.

In addition to this, a newer car can be more fuel-efficient, safer, more dependable and more comfortable. The first of these is directly financially important, the rest also has some value to people, how much depend on personal preference.

32. Samantha Bailey says 21 January 2009 at 06:49

Another advantage to driving an older car–less likely to have it broken into or stolen! I typically drive my cars for 10-12 years (around the time that the cost of maintenance and the inconvenience of breakdowns begins to eat into the benefit of driving an old car). Driving an old car isn’t a guarantee it won’t be broken into or stolen, of course, but I do think it lowers your chances! Also, I tend not to be stressed about little dings, worried about having the car “keyed,” etc. I always feel more stressed out the first 2-3 years driving my “new” car.

33. Eric says 21 January 2009 at 06:51

I think I’d rather be broke than drive a Geo Prism.

34. The Personal Finance Playbook says 21 January 2009 at 06:58

My dad used to always say that there was never a good reason to take out a loan to buy a car. Thus far in my life, I never have. Of course, I’ve driven some pretty junky cars, especially when I was younger.

I recently bought a new car (to me). I sold my 95 mercury for a nominal value and purchased a 2004 Toyota Camry. I paid all cash for the purchase. I don’t know if it was a good decision or not. It would be nice to have that 11k back, but I also have a car that starts every morning and gets me to work. Plus, I work in a field where clients may make judgments based on your appearance (including what you drive).

35. DebtFreek says 21 January 2009 at 07:01

I employee this exact same philosophy!

I currently drive a 2000 Jeep Cherokee. I bought it used & currently still owe on it, but plan on driving it well after I’ve paid it off.

Great article…people should REALLY take note of this article. Yes it goes against popular opinion, but isn’t that what we have to do to “Get Rich Slowly”??

DebtFreek!

36. najt says 21 January 2009 at 07:09

Not everything is as nice as it looks at first glance. Firstly, here in Europe (at least in Poland) owning an older car actually makes your insurance more expensive. The insurance company assumes that the older the car gets the more accident prone it is. Secondly, having an older car may save you money only when it is a fairly dependable car. Sometimes buing sth new is more profitable because it brokes less often. What’s more, older cars tend to have less economical engines, which means you’re going to spend more on gas. However, this post is still a nice tip as upcoming legislation from EU will derogate earlier regulations which forced car manufacturers to publish car specification in order to allow anyone to produce equivalent spare parts. If the new legislation will come in force, only the authorised service stations will have the proper parts and knowledge to repair the car. Driving a rusty, old diesel may then proove even more frugal.

37. KC says 21 January 2009 at 07:09

I drove an 89 Nissan Stanza from 93-05. My parents bought the car for me used and I just pocketed the money saving for my next car. In 05 I got rid of the Nissan w/150 mi on it. I bought an 01 Acura for \$18k. I paid cash. I’m still driving the car and its still a very nice car. And its still worth \$7k or so.

Last year I did put about \$1600 in repairs in it. First off I bought a new set of Michelins in January (good for another 65k miles). Then in December I had the timing belt, water pump and 90k mi service done (at an independent mechanic I know and trust). So I fully plan to drive this car for about 4 more years when I should be at 120k miles. I’ll reevaluate my plan at that point.

My husband prefers to buy a new car for himself – as long as his “wants” are modest he comes out ok if he drives the car 12 years or more. We basically try to keep the cost of the car (minus repairs, gas, maintenance) to less than \$2k per year. In other words I paid \$18k for the Acura I have to drive it 9 years. He paid \$24k for his Camry – he has to drive it 12 years. OF course things will happen – like accidents and family changes that might require a different type of car. But we try to stick to the \$2k/year cost.

38. Jorge says 21 January 2009 at 07:10

Great post! What’s great about driving your car into the ground is that it’s a strategy that everyone that drives can implement. Put it in your plan to drive your car for at least 10+ years and watch your savings account grow!

-Jorge

39. jeffeb3 says 21 January 2009 at 07:15

Ryan2, Gunnar,

I think it’s a perfectly reasonable way to calculate the savings. Here’s my justification:

The geo was worth what \$13,000 new? After 4 years, maybe it’s worth half \$6,500? But, what most people do is trade it in (trade in value \$4,000), they get a more expensive car, maybe \$17,000. They have the same loan, \$13,000, and the same payment, and only one car. They 2nd car might be nicer, but it still has 4 tires and one steering wheel.

That’s the argument made, and if you look at the expenses that people incur when they get into the car swapping cycle, this is an extremely good estimate.

The problem with the depreciation estimation is that you described is that it tells you how to estimate the cost/yr or cost/mile of his geo, but there are a lot more steps to calculating the cost of the new cars each year, and you’d end up with almost the same number, if you get every step. Finance, dealer vs FSBO price. In Ryan’s counter example, if the alternative to the geo was buying a new car, with the same car payment at the end of ten months, then the geo will save you \$130,000.

In my experience, buying used, and keeping in the long run means that you can buy your way out of almost any mechanical problems. I think it’s a given truth that repairing a car is going to be cheaper than buying another car (even if it’s used).

40. Frank says 21 January 2009 at 07:21

Hi,

why drive a car at all? I commute to work by subway, which is cheaper then the gas only. And faster.

From time to time I’m renting a car for the weekend. Which is about 90â‚¬ for the whole weekend.

And I’m a member of a car sharing community. I can pickup cars anywhere in the city. This costs about 2.30 â‚¬ an hour plus 0.24 â‚¬ per km. Including the gas.

So my annual costs are less then 2500â‚¬. And I’m always having a car that smells new 😉

41. anne says 21 January 2009 at 07:23

I actually like your way of thinking ‘saving’ the car payment every month. It’s using the same philosophy as Dave Ramsay’s snowball method of paying off lowest cc debt first to gain a sense of accomplishment which leads to more confidence and less liklihood of abandoning your new and improved budgeting ways. Guess the critics are not seeing the philosophy behind it!!
Concrete thinking is depressing.

42. Ian says 21 January 2009 at 07:23

Great Post! My car is going on 10. And until it no longer runs, it will be my car. I think though when you do have to buy a car, you should try to find something not too old to make sure you get the benefits of the milage and hopefully some warranty. Just not new.

43. TosaJen says 21 January 2009 at 07:24

We try to avoid investing in depreciating assets, too. Most cars are transportation, not investments.

Our current cars are a 1994 Toyota Corolla (165k) and a 2002 Honda Odyssey (80k). They look a bit trashy, but we’re OK with that. They run fine.

We’ve had a few expensive repairs on the Corolla over the past 3 years, but they’ve been a lot less than a replacement used car.

I remember someone asking Click and Clack when it’s time to stop paying to repair a car, and they said that when the repaired car is worth less than the repair *to you*, then it’s time to give in. We haven’t gotten there yet, but we set a ceiling estimate number whenever we take one of the cars in for repairs.

44. Emily says 21 January 2009 at 07:25

Or you could ride a bike, walk and take public transportation. If you have a gym membership, you won’t need it if you bike and walk. If you skip using your car even 20% of the time, think of the money you’d save, the wear and tear you’d save on your car, and the health benefits. I won’t go into the environmental benefits! 🙂

45. Jeff says 21 January 2009 at 07:26

As some of the comments above have mentioned, this type of money savings is highly dependent on the individual car, but it also depends on where you live.

In 2003 I was driving a 1994 Dodge Spirit with 169K on it. The engine still ran perfectly, and it never gave me any problems. My problem, however, was that I was moving from New York to Pennsylvania. In New York they use a ton of salt on the roads in the winter, and everyone that lives there knows that no matter how much you was your car it will eventually take a toll on the sheet metal. So the car had some rust holes in it that were completely cosmetic issues and was perfectly legal in New York. When I had the car inspected in PA (one month after getting it inspected in NY), they said in order to pass state inspection I would need to get body work done on the car that would have cost me in excess of the car’s worth. Even though the car ran perfectly and still had plenty of life in it, I was forced to give it up because it had rust on it. Every time I drive up to NY now and see 20-yr-old pick-up trucks with only a third of the rear fender left due to rust, I am always a little bitter.

46. Irving Isler says 21 January 2009 at 07:29

@Emily; and yet I think it’s important to look at things we do in as large a frame of reference as possible, because everything you mentioned should weigh into any decision.

And it’s a pretty easy, logic argument to make for decreased dependance on the automobile.

OFFTOPIC Warning

I bet if one were to chart the easy access to car loans, with the popularity of tvs and cross reference to obesity we’d see a pretty big increase around there.

I got pretty chubby after I got my first car. I used to bike everywhere. It was a challenge to work back towards what I had going right in the first place.

47. Sam says 21 January 2009 at 07:30

We just bought a new (to us) car this past fall, we saved up and bought the car with cash. I had been driving a 1999 paid for car that I hated. In the same time period that I owned the 1999 car I have a friend who leased two cars (her first least cost \$500 a month and her second lease is \$700 a month and she still has student loan debt) and I have another friend who is on his fourth car. Those car payments add up my friend leased her first car for 3 year years and then renewed because she wasn’t sure what to do, she spent more than \$25,000 on that first lease (I bought my nused car for less than \$20,000).

48. Ashley says 21 January 2009 at 07:31

I was able to pay off a new 1992 Honda Accord within 6 months, and it was still going strong in the fall of 2008 with 252,000 miles when I hit a deer :(. While I had some high maintenance years (up to \$2000 on a really bad year), all maintenance costs (including oil changes) averaged to less than \$70/month for the life of the car. And my insurance was down to less than \$50/month. And I did splurge on occasional detailing (~\$130 and worth every penny – I only did it 2 or 3 times over the 16 years), so the car didn’t quite have a new car smell, but it was close :).

Unfortuntely, with my current circumstances I did have to go into debt to buy a used car, but my payments are only \$139/month, and I work at home now, so maintenance and gas are really low for me.

I would have driven that car another 10 years if I could – not just because of the money, but as others have mentioned, it’s actually really nice to have a car that you really don’t care if it gets banged up, or even totalled (so long as no one gets hurt – I mean, I really do feel for the deer, but no one else was hurt). It was awesome that I knew for years that no matter what happened to that car, I was already so far ahead by keeping it for so long.

So many people didn’t get why I would continue to drive the same car for so long – but that’s okay, I don’t get those people, either.

49. Mirrah says 21 January 2009 at 07:33

I too have an older car, a 1993 Honda Civic. I bought it new in 1993 and paid it off in 2.5 years. It has been the best running car I’ve ever had, only about \$2500 of repairs in the last 16 years. I simply like my car, so that’s one reason I haven’t updated, the other reason is I can only put so much away per month, but I am almost there so when my Civic finally gives up, I’ll be ready. Great post.

50. Spend&Save says 21 January 2009 at 07:38

We do basically the same thing. DH drives an ’01 that has 120k and runs great. I got a “new” car (2002 with 60k) in April ’08 and sold my ’92 with 185k very cheap.

51. Steve H says 21 January 2009 at 07:53

Good post, good plan. We are working the same plan. The only thing I see is that you said you “saved” \$27,000. That is only true if you actually saved the money. I assume from the later comment that you are now putting \$300 a month into an ING account and that you will have about \$10,000 for a down payment soon, that you weren’t actually saving your savings. Had you done so you would have had around \$40,000 in four years. That would have allowed you to pay cash for a pretty sweet new car.

Not criticizing. I made the same mistake. We haven’t had a car payment in seven years, but we also weren’t saving the savings until a couple of years ago. I now have almost \$10,000 set aside for another car, but I’m kicking myself for not saving my savings for the past seven years. \$10,000 is great, but I have come to love the no-car-payment life and \$10,000 won’t buy a new car. We will keep driving our old one as long as we can and hope to get as close to a paid-off new one as possible.

52. Ryan2 says 21 January 2009 at 07:59

@anne (36) and jeffeb3 (35),

You’re basing the amount that you’re “saving” by not having a car payment on what seems to be a standard amount for a car payment. So what happens if Americans suddenly start spending alot less on cars, as is happening now? Are you now “saving” less than you were previously, because the average benchmark has gone down? No, of course not. You can’t calculate what you’re saving based on some potential arbitrary cost that you’re avoiding. The person who buys a bunch of Stuff with coupons didn’t save money, he spent it, albeit for somewhat less than full price.

If the way of thinking “I’m saving a car payment” works for you, that’s great as far as mental motivation. I understand that personal finance is as much mental as it is mathematical. And to a certain extent, you’re right to do that when you’re tempted, looking at a new car, for example. It’s good to say, “Well, by not buying that new car, I’m saving \$300 each month.” What you’re really saying is “Acquiring that new car will cost me \$300 additionally each month, and I would rather save that money instead.”

You save money by setting actual dollars aside and putting it in the bank (or whatever).

It’s a tough argument to make to try to claim that you’re saving money whenever you spend less than what the average American spends on a similar product or service. And that’s basically what you and the author are trying to do. Well I would/should/could be spending X, and now I’m not, so I’m saving \$X. Maybe.

Many people go to the movies; I prefer Netflix. So I’m saving, let’s say, \$30 a month. Many people take yearly vacations for \$5,000 a year. I don’t always do that, so that’s ALOT of money that I just saved. Wow, I’m doing great, aren’t I?

If you haven’t made a deposit into an account, you haven’t saved anything. You may have avoided a potential cost, I’ll grant you that, but that’s not the whole picture.

I don’t mean to attack the methods that work for you. We’re all in agreement here about the importance of frugality issue. This is simply nitpicking the details, and I’m doing so because the author told the story in a very numbers and accounting style, and that’s just not accurate.

The easiest way, at least for me, to think about cars is as an expense. They’re an expense I have to endure in exchange for the transportation they provide. For me, I like to manage these expenses similarly to how a business would–a capital investment that has a tangible but depreciating value that provides a useful service.

53. FranticWoman says 21 January 2009 at 08:05

Great post! I am from a family of “drive that car into the ground”. Yeah!! There’s others like me!!

My last used car (pd cash \$5300) looked pretty bad after 10 years of driving it. After one accident I was left with an off color replacement hood. I suffered years of jeers from friends for the two tone car with the paint splatter flanks (drove over a wet line on the road). I didnt care! Why? Because I saved 30k in 10 years driving that ugly (yet v. reliable) car.

It is nice to see the post break it down. I never did the math other than the “car payment” to savings + interest. I didnt subtract repairs because I only had one major one and all cars eventually need maintanence/repair. When I did need the (only) big repair, new the part was \$1100; salvage yards, \$700 + labor to fix. Everyone said “Oooh buy a new car! \$700 is like TWO car payments!!” I’m like, uh, yeah, two out of SIXTY! ACK!!!

Frankly, I’m afraid of car payments. I’ve never had one and dont want to start now.

PS: My current car is a 1996. I dontated my 1993 car to charity. It was still running fine, but a family member had the ’96 car to give. Also in good condition, low miles. I’m hoping to at least get three years out of it *knock on wood* if not more.

I do miss that old ugly car though *sniffle*

54. J.D. says 21 January 2009 at 08:09

Point of trivia for other readers: This post did not start out as a post. It was an e-mail that Joel sent to a friend. As an afterthought, he forwarded a copy to me. I polished some rough edges, and voila!

What I’m trying to say is: I think this real-life stuff is awesome, and if you have similar stories to contribute, I’m happy to share them with GRS readers.

55. Jim says 21 January 2009 at 08:10

You can do all the calculations you want, but, honetly, the one thing you’re not likely come up with is a financial justification for buying a new car over the one you currently own. There are only two reasons that it really ever makes sense to replace your car:

1. It is no longer safe. This is a very important reason and must not be overlooked when performing your calculations.

2. You really just absolutely can’t stand your car anymore and it makes a negative impact on your quality of life. Happiness and general satisfaction with life are things of value. If you can’t stand waiting 45 minutes in the winter for the interior of your car to get warm or you can no longer stand the uncertainty of wondering when you’ll have to make your next repair, get different car.

Just make sure you stay within your means and don’t plan on trading it in as soon as the new models start showing up in magazines. In my experience, an ill-considered car purchase is the one thing that most commonly sends people over the edge financially.

56. James says 21 January 2009 at 08:10

I have a 2000 focus, which I have had for 4 years now with over 120,000 miles on the clock.

Bought second hand for Â£3500, current price about Â£2900, which is pretty good for deprecation.

It looks good, and even with client visits, never lets me down on the appearance front. Some subtle accessories (beautiful new large alloys Â£150 from eBay) help.

I have always kept my cars for as long as possible, and done repairs myself, apart from a recent non-insurance claim accident.

I also find I can get around Â£500 – Â£750 for breaker parts for the old vehicles I strip. This also helps in terms of the overall running costs for the vehicles life, there are always bits in good condition left over and people to buy them, no matter how old the car.

I look at around Â£500 per year in maintenance, eBay is brilliant for getting the prices down (dealer quote, Â£900 for disks and pads fitted, me in the garage with branded pads and about an hour, Â£50).

NB: The focus is not know for rusting, but one of the rear doors had some internal flaking, replacement off eBay for Â£35, mate painting it as a favour for some work I did for him, (professional indistinguishable job, free)

57. angulo says 21 January 2009 at 08:21

My 1998 Honda Accord EX(Bought new)has less than 68K miles!
Though the dark blue paint has badly faded from the roof,,trunk and hood due to the unforgiving Miami sun,the car still runs great,with just some minor aches like noisy power windows on cold days.
I bought new tires and replaced brake pads at 38K miles(In 2003!….may have to do that again soon).Had the timing belt and water pump replaced at 60K(In 2007)..Oil changes and other maintenance performed on it every 8K miles or so….All these things bringing my maintenance expense to around \$400/year on average since I paid the car off in 2003.
I still carry full coverage including comprehensive,for which I pay \$956/year(Miami is an expensive city for auto insurance)…I may drop the comprehensive portion and save about \$300 a year.
The interiors still shine with semi-annual Armor-All treatment(which does leave a “new car smell”)
On hind-sight, I realize it was a good idea to have bought a higher-end model like this one instead of a cheaper model,though I took a lot of slack when I admitted buying it brand new on
the various frugality newsgroups at the time.
I admit that I may feel slightly embarrased when I park next to all those shiny Escalades,Lexus and Audis that abound in Miami. or if I had to use valet-parking..but then…I think of so many people I know with \$600 a month car payments and leases…. and I do the happy dance!

58. seawallrunner says 21 January 2009 at 08:21

I have a 13-year old BMW 3-series which I bought brand new. 13 years later, and 130,000 km it still looks great and drives great. And most of all I am happy that it has survived this long, and cost so little to maintain. I’ve owned other cars previously (and drove them into the ground too) but they were far more expensive to own than this little guy.

59. Dan says 21 January 2009 at 08:22

I found things a little different when owning a car. My first car purchase was 1994 for around \$10.8k, Nissan. I kept the car another 14 years. I managed to sink roughly \$11k in maintenance–I’m very surprised (suspect) of your \$2k repairs. But mine included all the tires, 4 sets or so (\$500 each time). But not fuel–major expense. Changing clutch, starter, water pump, etc is like another \$3k. So, it adds up quickly. A timing belt replacement is \$600 alone. Bottom line, allocating at least \$500 a year for a car is required. Another \$1000 on fuel, another \$500-750 for insurance, etc. I estimated any car is at least a \$3k per year cost. Also, as a car gets older so do repairs. At 8 years my car cost \$3k to keep. But cost went down after that. At the 14 year mark I figured keeping it would start costing too much money so I sold it for \$2.5k, a good deal for 1993 (15 year old) car. Did buy a new car, but paid cash…good thing too, and sold stocks/mutual funds that would have lost 30% had I not done that. So, I actually have come out ahead by buying new even when you account for depreciation lost (10%) driving it off the lot. I will note, that next time I will buy used (~4 years when our 10 year old car needs replacing). New is nice…but not necessarily better.

60. pfincome says 21 January 2009 at 08:25

Nice breakdown of the expenses. I have a 2001 Saturn SL1 that is fully paid off and have not had to make any payments in almost two years. I hope to drive it for at least 10 more. My only concern is that it doesn’t have the safety features that some of the newer vehicles have. However, this car is used to drive to and from my work (60 miles per week). As long as you keep up with the maintenance on the vehicle, you should be all set.

61. JW says 21 January 2009 at 08:31

My van is 46 years old (1962 Ford). I put in a new (someone else’s old) engine last year for \$300. I do all the repairs myself. I feel grateful to have a vehicle.

62. Carla says 21 January 2009 at 08:32

I agree, it so depends on the car. My ’88 Volvo 240 had to be donated this past spring. I was LUCKY that it lasted the six years I had it and that I only put \$400 in repairs during the time I owned it. Not to mention driving a 275K+ mile car on some of the steepest city hills in the country (San Francisco) on an original clutch That is extremely rare. I don’t expect to be that lucky again!

My grandmother’s ’87 Nissan Maxima retired a few years ago at 350K miles and she never put more than \$1500 in repairs. I dont expect to see that again!

63. allen says 21 January 2009 at 08:40

I just wanted to say that i drive a Kia Hatchback which costs NEW only 15K. a Kia 4-door can be had for only 10K. So, the author could just buy a brand new car that has a ten year warrenty with the money they’re putting aside when they’re ready.

I like the idea of running a car into the ground. I just didn’t feel comfortable enough to do my own car work, and i don’t have a garage do to that in, which are the two main reasons i decided to go with a brand new car, but only one with a ten year warrenty.

Everyone have a good day! (won’t be following up)

64. Ed says 21 January 2009 at 08:42

I’m sympathetic (and drive a 99 Saab with 150K miles that I paid off many, many years ago), but I think you’ve missed out on two or more generations of safety improvements. It appears that your car has one airbag per front seat passenger and may have abs. I think the relatively modest cost of moving up to a used vehicle in the 2002 range, with at least some type of side airbags, abs if you don’t have it, and perhaps one of the stability programs (ESP, ESC), let alone simply better engineered passenger compartments, frames, and doors is well worth it.

65. renaissancetrophywife says 21 January 2009 at 08:45

I bought my 1999 VW Passat used in ’01, for about half of what it would’ve been new. Back then I knew I wanted something sturdy so that I could drive it until it fell apart– and doing my research up front really paid off.

A lot of newer VWs (and other cars) have flimsier construction, based on where they’re manufactured, but I made sure to double-check the VIN number and got one that was manufactured in Germany. Once you’ve narrowed down your car choices, car forums are a terrific resource to figure out what problems others have encountered 5-10 years down the line, and what to look for if you’re buying used. (Another commonly-known fact re BMWs is that each model gets updated every 7 years, and you don’t want to buy the first year of the upgrade since they correct most of the kinks after that.)

I also bought a stick shift to save on gas, and I’m sure that’s contributed a fair amount of savings over the years. My car’s still going strong, and even though I might upgrade a little when it gives out, my next “new” car will only be new to me.

66. Gen says 21 January 2009 at 08:48

I agree with the commenters above that it really depends on the car.

My 1997 VW Jetta cost me over \$3,000 in repairs over the last eight months I owned it, and I sold it, at 190K miles or so, with another \$1,000 of repairs outstanding.

I was planning on trying to keep it on the road longer, but it just wasn’t an option. The funny thing is, I’d started to feel unsafe in the car right around when the maintenance expenses really ramped up. In retrospect, I wish I’d listened to my gut feeling about the car.

67. Gen says 21 January 2009 at 08:50

@#64: My horrible VW experience was with a car from one of their Mexican plants, FWIW. We had much better luck with the 1980s models, which were all made in Germany.

68. mhb says 21 January 2009 at 08:50

Just this week (!!!) we paid off our 2000 Honda Accord that I bought used in 2006. My husband and I were just talking about how we’ll keep it around for our kids to learn to drive on.

Our kids haven’t been born yet. 🙂

Great post!

69. Barry Sampson says 21 January 2009 at 08:51

When I left my job to go freelance last year, I put some serious thought into what to do about a car. I’d had company cars for the previous 5 years (the last one being a Mini Cooper Convertible).

My original plan was to lease a car, and allowing for servicing etc, I planned to spend Â£350 per month for a fairly standard hatchback (a Seat Leon), so that’s Â£4,200 p.a. for the 3 years of the lease.

Instead, I bought an 11 year old BMW 316 for Â£1,500. I’ve spent Â£800 having some work done to bring it up to scratch, but I figure I’m still ahead by Â£1,900 after the first year. And the best bit? Compared to the Mini, it’s more comfortable, more economical, more practical and believe it or not it has a better turning circle (which can be important on our narrow roads here in the UK).

70. Ben says 21 January 2009 at 09:05

I own a 2003 Honda CR-V with 78k miles on it that is fully paid off, but I now live in a city where I rarely drive it. It’s a major hassle to deal with moving it for street cleaning and difficult to find a parking space when I do use it. I’m debating if I should sell it or just keep this car forever since it is a nice car and it’s nice to leave the city every now and then. Any thoughts?

71. Gusten says 21 January 2009 at 09:06

Hi all, I’m probably at the low end of the spectrum, with a 1983 Saab 900 which is coming up on 500k miles. I feel it’s a sound economical decision (one of the things that really matters here is that it’s worth so little, that any eventual expensive repairs will send it to the scrapper instead of me sinking money into it) but I can’t rely on it 100%. Probably not the best decision for the environment to keep it, but I can’t afford a more expensive one at the moment.

Hope I can give you some perspective =)

72. TeresaA says 21 January 2009 at 09:09

I have a 2000 Saturn SL Series Sedan. I bought it used, and I have just two payments left on it. I plan to drive this car as close to forever as I can. The car has no rust and is in excellent running condition. I look forward to no car payments and lower insurance rates. I plan to divert most of the money I save to a “Tranportation Savings Account”. This money will be used for any necessary car repairs and maintenance, or to replace the car (with another used car, of course),in the event it up and dies and repair does not make financial sense.

It goes without saying that should the car become unsafe, it will be immediately replaced. I have also thought about whether I would trust this car on long road trips. The solution I have come up with is to rent a car on those few occasions. There are great deals to be had on weekly rentals and I figure it still far outweighs the cost of a monthly car payment!

73. Steve in Montreal says 21 January 2009 at 09:10

I’m doing the same with my current car. It’s only 5yrs old and I hope to reach 15. It’s a Corolla so the odds are with me. After I paid it off, I put the same amount into a saving account each month. It builds up the emergency fund fast!!

74. BillH says 21 January 2009 at 09:17

Great post. I try to do it somewhat more simply. In my area you can usually find a well maintained import (usually Honda or Toyota) with about 100K miles on it for \$3-4000. With proper care and maintenance, you can get another 100K miles out of it. Then do it again. that’s 200K miles for \$8K Even if you buy a new car, for \$20-30,000, take care of it and get 200K miles out of it, you are ahead of the game, even with any needed repairs. If you \$3000 car blow up, buy another and you are still ahead. And that doesn’t take into account costs for insurance and interest payments. Anyway, buy a well maintained import for 4K, take care of it, drive it to death, rinse and repeat, bank the savings.

75. Steph says 21 January 2009 at 09:28

Our “new” car is a 1995 Subaru, which we bought 3 years ago with 235,000 miles on it. As with all our vehicles, we paid cash and do repairs ourselves.

The best advice I ever had about using credit was to only buy assets that appreciate, never something that depreciates, if I’m making payments over time. When GMAC was cold calling me trying to say I had a bad loan with them (it was some other Steph) I was able to say that I knew they had the wrong person because I’ve never had a car loan. It stumped the supervisor and they quit calling.

76. Jan says 21 January 2009 at 09:29

I’m in this with you. I have a 1996 Pontiac Sunfire GT. I paid it off early and have had no payments for 10 years. Of course, the LCD for the clock and radio doesn’t work anymore and there is no air conditioning unless I decide to charge it each year, and the passenger window doesn’t roll down, but it’s paid for and drives well. That’s all I could ask for. I just hope I can get a few more years out of it. Great post! Thanks!

77. V. Higgins says 21 January 2009 at 09:33

I was 22 when I bought my first car and it’s a slightly rusted, lots of cosmetic quirks 1992 Honda Civic… and I’m totally in love with it! 😛 I’ve had it for almost a year and *knock on wood* haven’t had a single repair (tires and oil change don’t really count). I do drool over the newer Civics but I plan on driving mine until she either becomes unreliable or unsafe. For me, not having a car payment and paying for my first car with cash has been a great feeling. I’m hoping to do the same with every car I purchase, pay entirely in cash, or at the very least 50%. The ‘new car’ extras (power windows/locks/seat controls) just aren’t worth the stress of a car payment.

78. Cathy says 21 January 2009 at 09:37

I never understood why some people change cars every few years.

I was looking at buying a Mini last summer. All of the used Minis on the lot were almost exactly 4-5 years old, and/or 50,000+ miles. Mini has a 4 year/50,000 mile warranty. People are driving them out of their warranty and trading them in! I couldn’t believe it.

79. Mitch says 21 January 2009 at 09:43

That guy is lucky. As others stated it really depends on the car and not everyone can do their own repairs. Besides I think there is a line between being thoughtful about your money and just being cheapskate for its own sake.

80. Beth says 21 January 2009 at 09:47

Everybody makes fun of my little 2001 Ford Focus Wagon. They ask me, why don’t you get a new car? My little Ford Focus (aka Little FF) has 171,000 miles on it and runs great (knock on wood). My goal for my Little FF? To get to 250,000 miles! How excititing is that?! So, I’m figuring about 3+ more years. I love everything about my Little FF – even the rusted roof. Sure, there are things I don’t like (like my dogs window won’t go down), the scan button is busted, it doesn’t have 4 wheel drive (which by the way, I’ll be getting when I get my next car). But that’s okay. My Little FF and I will ride off into the sunset.

81. Shara says 21 January 2009 at 09:48

I have previously run the numbers (on this site in fact) for the *cost* of owning a car. And we all agree that we need to keep that cost A.L.A.R.A. (“As Low As Reasonably Achievable”, a familiar term for those of you who work with hazardous materials). The current culture of buying a new car every couple of years is silly.

But at the same time I don’t expect everyone to wring every last penny of value out of a vehicle. My expectation is that people understand the cost vs. value:

*What do you need?

My husband is 6’8″. I am 6′. I got rid of my first car (a 1999 Mazda Protege) after I got married because getting him in and out of the stupid thing was like working with the clowns at the circus. In a similar situation we got rid of a sedan for his current truck when we had our first baby because putting both of us into a standard sedan left no room for an infant seat. And if we have too many kids for our standard 5 person seating we will have to get a still larger vehicle.

*What do you want?

Safety straddles the line between needs and wants. You NEED a safe vehicle, but you want the MOST safe vehicle. I want a reliable vehicle. I don’t worry about the expense of repairs as much as the time commitment. I have to get it to the repair shop, get to work, coordinate pick up, etc. I don’t mind it if I do it once per year, but if I’m doing it every few months, even for small repairs, that isn’t reliable. And the repairs i have the know how to do myself will take a time and resource commitment as well.

*What can you afford?

I’ll drive a junker if it’s all I can afford. And even if you can afford it, buying a new car every year or two is wasteful. But this is part of the frugal/cheap balance. After a point the expense and affordability need to be weighed against the needs and wants of safety, reliability, comfort, etc.

82. Gholmes says 21 January 2009 at 09:51

Good motivation, JD. Been 2 years of no car payments. Was frustrated with having to do a major overhaul.

You are correct, the cost to repair is less than my car payments when I look at it over the year. Thanks.

83. schornses says 21 January 2009 at 10:09

Other intangible benefits of owning an old car:

1. Leave it parked in front of your house. People will assume you have no money, and they are less likely to break in. Also, you’ll have more room in your garage for storage.
2. No more worries of door dings. My kids routinely lay on and play on the hood and trunk of my old car and eat and drink in it. I’d never let them do this on a new car.
3. The cushy seats of my old American car are more comfortable than the stiff seats of my mother-in-law’s ’07 Accord.

On the other hand, my old car is not much fun to drive. My wife (a nurse) is always sharing stories about folks cut down in their prime by illness or accident. This makes me want to go get the MINI while I’m young enough and healthy enough to enjoy it.

84. friend says 21 January 2009 at 10:17

for mhb, who hopes her yet-unborn children will drive her Honda…

it might happen.

We brought our newborn son home from the hospital in 1996 in our 1990 Honda Civic. He’s 12 now and wants to learn to drive it…

(If that car isn’t around in three years, our ’89 Civic just might be — it has lower mileage, since the AC went out 10 years ago!)

85. Danny Garant says 21 January 2009 at 10:26

Hello

I fail to follow the basic principle that a new car cost more than keeping your old. Just before the holidays, I got a new car.
I had a rented a Honda Civic 2006. Signed up in march 2006+ for five years and planned to buy it back at the end. Last december, my vendor called to offer me a deal : Rent a 2009 Civic for the same condition in my contract for five years, starting now. He wants my car to sell it as a used one.

After some negociation, I said yes. I think I had made a good move cause :
– I successfuly negociated a lower payment.
– My insurrance didn’t raise enough to nullify the savings. In the net, I save 30\$ a month.
– I wast late in my savings to buy back the car in 2011. Now I can save less each month to buy back the car in 2014 and allocate the difference to other purpose like an emergency fund or laser operation for my eyes.
– It feels good to have a new color that reflect the new dynamism in my lifestyle wich I build around tips found here at GRS and elsewhere like AONC and Zen Habits. Taffeta White rocks

However, buying back the car is a plan B. Plan A is to go out of the enslavement of needing a car at all. It’s a project by itself and now I have five more years to implement it.

86. Jeff says 21 January 2009 at 10:35

I’m proud to report that I just paid off my 7% Auto Loan today. No more car payments! Actually, I’m officially debt free. Timely Post, great advice that I will take to heart.

87. kick_push says 21 January 2009 at 10:35

i hope i can stay away from a car payment for at least another couple of years.. i haven’t had one in about 4 years.. both my cars are over a decade old (1996 and 1998)

88. Lars says 21 January 2009 at 10:40

In this context, it’s interesting to mention a stimulus package planned by the German government: if you bring your old car to a certified wrecking yard and buy a brand new one that fulfills the highest environmental standard, the government will pay you the equivalent of \$3,300. So far car dealers have reported a lot of interest by potential buyers, even thought this plan isn’t in effect yet. A good way to help struggling carmakers?

89. Amber says 21 January 2009 at 10:51

I bought my “new” 2004 Sunfire in Oct, ’06 and plan on driving it until the wheels fall off.

After this car is paid off I will never get another auto loan. Starting the month after its paid off I’ll start putting my \$200/mo “payment” into my ING account to suppliment my emergency savings (for repairs, etc) and, when the time comes, to be able to pay for my next car outright.

I’m 24 years old now. I want to still be driving my Sunfire until I’m at least 30. The only way I’ll consider changing cars before that is if my family situation changes and I need a bigger car (I drive a coupe with a tiny back seat).

90. partgypsy says 21 January 2009 at 10:53

I miss our ’89 toyota camry wagon. We got that in ’95 for 3600, drove it until 2006 (It ran like a top with minimal repairs and typical maintenance). Unfortunately a mishap occurred that made it never quite work right after that(friend borrowed it for a long road trip, forgot the oil cap so driving without oil until the car stopped). We tried fixing it but ended up selling it to the mechanic for \$400 : ( If that mishap didn’t occur we would probably still be driving it.

91. Frugal Dad says 21 January 2009 at 11:07

As the proud driver of a 19 year-old van I can appreciate Joel’s willingness to make sacrifices in his choice of transportation. Here’s to many more miles!

92. Matt the Car Guy says 21 January 2009 at 11:08

Longtime reader, first time poster 🙂

I have been lamenting with you about your Mini Cooper Desire, hoping you will pull the trigger and enjoy something for a change ;-). Admittedly, Car things are my passion. My thoughts:

-There is a high level of enjoyment you will get out of a car like a Mini Cooper including social interaction with the wonderful car clubs and people you will meet through it(promise!).

-You forgot to put a value on reliability in a newer car – missed meeting because of a breakdown can be a huge lost opportunity cost.

-I think you are over-estimating the cost to have what you want. ESPECIALLY right now, you can get a nice Cooper S with ~35k miles in perfect condition for around 13k. With the great credit union rates, your payment should be under \$250 a month, and with such low interest rates, why not add an extra year if you need to to get the monthly cost you want.

-Performance – I consider this a safety feature.. being able to get out of the way can truly save you from accidents or damages.

-Airbags and other safety features – basically any newer car is going to be dramatically safer than the Geo. Can you put a value on your life? Have you considered the cost of injuries that would be prevented by side airbags, dramatically higher side-beam crash standards… and on top of that obsessive BMW-designed safety in the Mini?

You might live in a safer area than me.
Another thought for you: Keep the Geo. It’s not worth much as a trade-in. Why don’t you keep it as your ‘beater’ car. You can loan it to friends in need. You can drive it when you are doing high miles tasks and keep the mileage low on the Mini. You won’t pay much more insurance with 2 cars and 1 driver, or 3 cars and 2 drivers because the way the ins. co rates it will be minimally higher – mini as “pleasure vehicle”.

Lastly, life is so short. You need to enjoy it. There is an unquantifyable joy in driving that compels people to buy nice cars every day. Maybe they aren’t as smart with money in their purchases, but you are 🙂 It’s the fruit of your labor!

93. hoops says 21 January 2009 at 11:09

man up and buy a decent car. 95 Geo Prizim? you sound like a total wuss. I agree with paying cash for a car but you are going way too far. its like you are saying: “look at this nice sweater with holes in it, I am going to wear it everyday! i am saving so much money!” but you look like douchbag. think about it.

94. Tim says 21 January 2009 at 11:26

isn’t the age of consent 18 yrs old? so you are an autophile and should be a registered auto offender.

95. Bob says 21 January 2009 at 11:26

When I bought my 1st car in 1970, a 1961 Plymouth, it seemed so old and worn out at 80,000 miles, but a bargain at \$186. My latest purchase was September 2008 when I traded a 1996 Sentra for a 1993 Accord. Yes, 3 years older, but an ACCORD with less than 130,000. In my mind this 16 year old car has more life left than that first, 9 year old Plymouth. Times and car quality have changed, but the principle of “buy good-used and drive it as long as you can” still makes sense.

96. Charlotte says 21 January 2009 at 11:28

Cheers to Kris for driving a Honda!

I currently have a Honda Civic and it is awesome! 1999 model (bought brand new), at 110K miles and 10 years later, I only had to replace batteries, brake pads, oil, air filters, fluids and tires 🙂 These are typical wear and tear stuff. My other Honda before this approached 200K miles.

In my experience, Hondas, Toyotas and Jeeps have the longest lives. I don’t want to turn this into a brand debate. Just wanted to share my opinion.
See how many commenters here own a HONDA? 🙂

My husbands Jeep now has 140,000 miles (1998), same as the Honda above. Just typical maintenance stuff. Previously, he had a Jeep also with 200K+ miles.

We sure hope it stays this way for a few more years. We plan to save up for the next car and buy nused with cash hopefully.

97. Glenn Carver says 21 January 2009 at 11:33

I love this philosophy and enjoyed it for many years. I recently bought a new car and have a payment for the first time since 1996. A Wise man once said you should never finance a depreciating asset. Being a Finance major, I get his drift.
However, I sure am enjoying my sweet, new Mustang!

98. Valerie says 21 January 2009 at 11:41

Except for the very first car my husband and I bought after we were married (\$5000 1980 Ford Fairmont), we have bought all used cars. We have also made it a practice to pay in cash so that we won’t have any car payments (Even the new one we paid for in cash). We have a 1990 Oldsmobile 98 with 264,000 miles on it (had it since 1999). We have money saved up to buy a “new” used car, but that Olds just keeps on going! The longer it goes, the more our money grows. Our philosophy about cars is the same as with anything else: If you don’t have the money, then you don’t buy it.

99. Candy says 21 January 2009 at 11:43

I think a few other people have touched on the fact that the make and reliability of your car can greatly change the chances of actually being able to drive it until it dies.

My first car was a Pontiac that I paid for in cash from money saved from side jobs, but the car was either a complete lemon or that brand is just a money pit. In the 6 years I owned that car (from 1997 to 2003) I had to spend 15,800 in repairs besides regular maintenance. When I finally was able to have a friend sell it for me in 2003 (90,000 miles) it needed ~\$7,000 in additional repairs.

Instead of spending that money on repairs I used it and some other earned money to buy a Honda Civic Hybrid and I am so much happier now! Besides saving 80 to 100 a month in gas, I have only had to spend \$1,200 in additional maintenance in the now almost 6 years I have owned the car.

100. Ryan2 @ Danny says 21 January 2009 at 11:45

“I fail to follow the basic principle that a new car cost more than keeping your old.”

Tell us what your payments are (down payment, and monthly) and I’ll show you.

101. Neal Frankle says 21 January 2009 at 12:02

I also love this article. I must point out that it works a lot better when you do two things:
a. buy a Toyota or Honda

In 1994, we bought a Ford van and a Toyota Camry. The Ford van turned into a can of tuna several years ago. The Toyota is sitting in my driveway and being driven daily.

I bought myself a car last year – a Lexus. It was 2 years old and I paid 40% of what the new one goes for. I expect it to last at least 12 years.

I was able to get a good read on the price I should pay by shopping ebay – even though I didn’t buy it there.

102. Raj says 21 January 2009 at 12:09

Now here my guilty consciousness of buying new has increased.:)

I have bought Honda odyssey 2007 New @ \$29k. I am thinking of down grading to some cheaper used car due to too much loan liability. The current value I can sell it for is \$24k and almost same amount I owe to the bank as well.

Do you guys think its a wise decision ? I am still confused between heart (as this is my first new car) and mind (cut the loss) ?

103. Dave Farquhar says 21 January 2009 at 12:12

Excellent post. There’s one other thing, that may vary depending on the state you live in.

In Missouri, you pay personal property tax on your car. The newer your car, the more you pay. By driving a seven-year-old, paid-for car, I save a couple hundred dollars a year in taxes.

My wife and I both drive 2002 Honda Civics. On average, we’ve spent about \$1,000 a year keeping them running and we’ve only had to do one unexpected repair. The cost may go down for the next couple of years since we’ve replaced all the major consumables (timing belt, shocks/struts) recently.

Not having car payments helped us pay a mortgage off in five years.

Needless to say, economic downturns are a lot easier to handle when your biggest monthly expense is your natural gas bill.

104. Bill in NC says 21 January 2009 at 12:28

Y’know those paint jobs specials at the local auto body shop cost only a few hundred bucks and look just fine for a few years.

My 1997 Subaru is losing its clear coat so I will be doing the above this spring.

105. Isabelle says 21 January 2009 at 12:38

We also buy used cars and drive them until they cost more to run than to buy a new to us car. What really intrigues me is that in America it is assumed that one gets a loan to buy the next car – why not simply save the whole amount? On many frugal sites and posts even the most frugal seem to accept a car loan and the monthly payments as being inevitable. Why?

We do not specifically save for the car, but we save generally and take the money out of the pool to buy the next car. The idea of a loan dragging on and all the money wasted in interest is one I really wouldn’t want.

106. Ben says 21 January 2009 at 12:46

I drive a 91 Honda Accord with 270,000+ miles on it. I’d like to take it to at least 300k miles. I just bought a radiator to put in it, but it’s doing quite well overall.

107. PDXgirl says 21 January 2009 at 12:53

I actually don’t think this math is all that fuzzy…

If you pay \$250/mth for a car payment you have \$250/mth that is budgeted toward “car payment”. Once you are no longer making that payment (In my case my car was totalled when I got hit stopped at a stop sign) then you have that \$250/mth to put to other uses (I put it into my 401k) so I am saving \$250/mth because I no longer have a car payment.

It may be technically fuzzy from an asset accounting standpoint, but it is literally true.

In other news, I now drive my boyfriend’s 1982 Volvo (he drives a ’97 Volvs everyday) and am saving for a newish used car. This Volvo has over 300,000 miles on it and cost about \$600 in repairs/maintenance last year (including oil changes) it is super reliable and I honestly love the old beast.

108. Pasha_TX says 21 January 2009 at 12:59

I used to have ’99 Accord from mid 2003 to mid 2008 (5 years) which did not bring me any problems since i bought it as CPO. When i moved to bigger city, you see more aggressive drivers, so you need better breaks, better handling and safety. even though i did not need a car, but i went ahead and got 2004 BMW. It is bad idea to buy something that will be in the shop a lot more often than the older car that run great …BUT you have to remember that saving money is good, but you live once..Holding off on having kids or downsize your living might be better than driving unsafe and unreliable car. Previous car (’99 Accord) did not have ABS, no stability control, no side airbags, slow to stop and less agile handling and pick up…so if you live in a small town and all you do get groceries, getting older Japanese make will do, but if you have to be at work in a suit and drive your co-workers for lunch in the safe car when it’s your turn…all together it is totally worth it. again, person is saving net of 20K, but then he or she can be hit by a bus or rear ended, or get diagnosed with incurable disease… all that waste and sacrifice for what??!… just hold off kids for some time…cheers all.

109. Becky says 21 January 2009 at 13:10

Re #36.

I also live in Poland and buying a new car is quite expensive. You have to worry about theft, buy auto insurance that covers theft, etc. When you drive an older one, you can drop that insurance and it costs waay less.

Our insurance company bases their insurance rates (here in Poland…just south of Warsaw) on our driving record more than on the age of the car (liability insurance…we don’t carry A/C which saves a ton!).

I don’t understand why anyone even WANTS to own a new car here in Poland. I’ve heard too many stories of Mafia stealing cars–new cars are much more a target than older ones.

I was very delighted to have our first vehicle for 12 years here in Poland. We had to finally sell our Ford Transit van as junk/parts because it was in such bad condition/worn out. We had bought it a couple years old and used it to haul around young people for youth group as well as our family of 7. It was still running when we finally sold it for a few hundred dollars, but we were really afraid of some things breaking that could have caused a major accident.

Buying new just doesn’t make sense to me unless you do have the money saved up already in a savings account.

But it’s a mindset and some will never change.

AND to be honest, we NEED people to continue to buy new and replace their cars every year or two or three so we can buy used…..

110. mp97303 says 21 January 2009 at 13:16

Great post. I really agree with the idea with keeping cars and buying used. I bought my “new” car last week. It is a 2008 with 11,400 miles. I paid 50% of the price of the 2009 sitting next to it. Still has new car smell, full warranty, etc.

I will keep this car for at least the next 8 years. I traded in a 12 yr old car with 129K miles on it.

111. thestevie says 21 January 2009 at 13:21

you can get a better car then a geo

my 1972 240Z was really cheap.
and it looks so much better then a geo prizm.
(i know this because my 240z is parked right next to my sisters prizm.)
if you want a cheap car look into a kit car

112. Mike says 21 January 2009 at 13:29

That’s exactly what I attend to do. I made the mistake of purchasing a 2003 honda civic a couple of years ago and I’m still trying to pay it off. I will run this car into the ground.

113. Ty says 21 January 2009 at 13:29

I replaced my truck last july. I bought it ’97. It was payed off in 2000. I loved it, but after 170,000 miles, windows not rolling down and AC dead (did i mention I live in Dallas where it is over 100 degrees most of July and August) I bought a new used truck. I plan on having it for another decade plus.

I hate car payments.

114. tm says 21 January 2009 at 13:33

One trick my wife and I did after we paid off her car, was to take the payments we were paying, and putting them directly into savings. Since we knew we could make do without the amount of the car payment, that amount could right into savings after the car was paid off.

115. Ryan2 @ raj says 21 January 2009 at 13:34

“Now here my guilty consciousness of buying new has increased.:)

I have bought Honda odyssey 2007 New @ \$29k. I am thinking of down grading to some cheaper used car due to too much loan liability. The current value I can sell it for is \$24k and almost same amount I owe to the bank as well.

Do you guys think its a wise decision ? I am still confused between heart (as this is my first new car) and mind (cut the loss) ?”

No, I think you’re fine. Don’t do anything drastic. You probably need a minivan for your family, right? (Does anyone buy them for anything else?) It’s expensive, sure, but it’s not outrageous. It’s a good, solid, reliable, safe family car that should last you for another 10 years.

In fact, if you didn’t already have that car and asked me “I’d like to buy a used car, probably a minivan for the kids, what should I buy?” I’d say “Find yourself a good two year old Odyssey or Sienna.” You see my point? What’s done is done. You don’t own a new car any more, you own a used car. It might not have been the most frugal thing to buy a new car, but what’s done is done. Don’t feel guilty about it, be glad that now you know you don’t want such a large car debt in the future, and as you pay down your loan balance, you can say “I’ll never have this much car debt again, in my life.” And that’s alot better than most people.

From here, do what you can to pay off the loan early. Then when it’s paid off early, like everyone has advised here, keep driving it as long as possible while you save up for its replacement. Pay cash for its replacement, if possible.

116. Melinda says 21 January 2009 at 13:39

My car is 18 1/2 years old and my husbands car is a year or so younger! I bought my car brand new and paid it off in about three years. My husband and I decided a few years ago that I’d drive it until it died, and it looks like I’ll get about another year out of it. Meanwhile I have to live with other people’s attitudes to me driving an old car. I know quite a few people who assume that we drive old cars because we can’t afford new. In fact I had a friend – who should have known better – offer to buy me coffee one day “because I know you’re broke”. I just laughed and accepted the free coffee!

My husband and I know why we drive old cars. We’re currently looking at paying off our 30 year mortgage in less than 10 years. If we bought new or newer cars that’s money that doesn’t go on the mortgage and is multiplied by the interest we then pay. It’s not worth it to us.

117. Mister E says 21 January 2009 at 13:41

Love it.

I drive a 1994 Dodge Caravan. This will likely be her last year though, repairs are finally getting to be enough that I’ll trade her in.

118. Le Bolide says 21 January 2009 at 13:41

This may have already been said in the comments, but in 4 years with \$10,000, he’ll be able to buy a nice, several year old used car with several hundred thousand miles of life left in it, and still have the benefits of cheaper insurance, no monthly payment, etc.

Personally, I watch the new cars come out, pay some attention to which ones I like, then monitor their longevity/reliability, and then buy one that’s 5+ years old with low miles.

119. Francisco Prieto says 21 January 2009 at 14:00

I told my wife !

I have a 1997 Ford Explorer and no reasons to change it but I must confess, a lot of pressure.

Already saved around \$50,000 in car payments not made over the last 9 years !

Amazing story.

120. Cecelia says 21 January 2009 at 14:08

I follow this as well. I am currently driving a ’95 Honda Civic that I got in 2001 with about 154000 miles on it and it now has 260000 miles. I think I have put about \$3000 in repairs and it is running quite nicely. I plan to drive this car until it falls apart since I am currently back in school and will be for about 7 more years. I will have to get a loan if it breaks down before I am out of school but I plan for that to be my one and only car loan.

121. chrispc88 says 21 January 2009 at 14:25

Well, I just skimmed through this – but I can’t believe nobody has made the argument for doing the maintenance yourself. I’ll get to that in just a moment, but I also wanted to point out to “Dave Farquhar” that in Missouri (I live in SW Mo – Joplin) – that the cost of Personal Property on vehicles does go up after the vehicle is over 25 years of age – it is considered classic and starts appreciating in value. The value of my 65 Chevy 1/2 ton, 68 GMC 3/4 ton, and 76 Vette have each doubled for the past 3 years in a row (I’m told this year wont be as bad).

I also can’t help but laugh at one person pointing out performance on a mini cooper as a feature, because you could get out ahead in traffic faster… bud all I can say, is my 87 Firebird would eat that Mini alive, and it’s bone stock – 4 cylindars is just a joke for performance, unless you have a LOT of money to spend in upgrades.

So, to give you an idea of my costs for doing work myself… I’ll use my 87 Firebird (but the parts I mention would be true on any of my cars, since GMC/Chevy/Pontiac all used basically the same parts for YEARS). I bought the car for \$1200 about 4 years ago. I have since had to replace the water pump (\$30.00 at Autozone) and the starter (\$50.00 at O’Reilly). That’s it. Changing the water pump took about 40 minutes of work, and the starter maybe 20 minutes. Helping my friend change the water pump on a 4cyl 1994 Grand Am took the better part of a day trying to reach behind the front of the motor and under the intake to clean the old gaskets off – what a ridiculous place to put a water pump!

The most expensive car I have (including purchasing it and maintenance) has been my Vette – and that was just from the initial cost (\$4500). The most I’ve ever spent on ‘maintenance’ was when I upgraded my 65 Chevy truck from a 6 cylindar to a v8 and auto with a posi disc brake rear-end from an ’88 Iroc. I spent a total of about \$1100. I got the tranny free (350 turbo) and rebuilt it for about \$100 (cost of the rebuild kit and fluid and such)… bought the motor (350) from a salvage yard for \$100 and rebuilt it for \$400 (just a basic rebuild – i.e. no cylindar bore, reused all of the original rotating mass) – and I’m counting the used carb and rebuild kit along with various odds and ends with that cost. I got the rear end for \$100, resized the drive shaft for \$100 and spend about \$300 having new exhaust put in (I had to pay someone to do that, since I don’t have a pipe bender or welder).

Anyway, I realize not everyone can do all of this work themselves – but a lot of vehicle maintenance is not hard at all, and a person can save a whole lot of money if you just get a book, take your time, and do some things yourself – and be sure to double check your work! 🙂

122. Forty2 says 21 January 2009 at 15:02

Wow, everyone seems to love car stories!

Mine: after leasing since 2003, turned in a 2007 Audi A4 in Nov. at lease-end, threw the keys at em, and drove home in my new-to-me 1991 Volvo 240, 135K miles, barely broken in for a 240. As I now walk to/from work, I only need a car for grocery shopping and visiting friends/library, etc.

Sure it’s not all shiny new but it starts, even at 0F, and gets me where I need to get. I plan on having this car for at least five years, even though I could go buy a new Versa or Fit today for cash. No need for it.

123. Nicky says 21 January 2009 at 15:12

It doesn’t matter whether he actually saved the \$250 a month. By not buying a new car he had \$250 a month more available. Regardless of whether he spent it by putting it into ING or by buying something else it is money he wouldn’t have had if he had a new car.

124. rubin pham says 21 January 2009 at 15:14

those of you who plan to keep your old cars for a long time should also remeber that older cars tend to be unsafe. especially with side impact collisions.

125. Anne says 21 January 2009 at 15:20

“My wife is doing the same with her car, too. She has a 1996 Honda Civic (with only 60,000 miles on it!). She wants a new Prius. But she, too, is content to continue driving her vehicle until it runs no more.”

That is too cool! I didn’t think anyone out there could beat me. I have a ’96 Corrola with 82k miles on it. Way to go JD’s Wife!

126. netzhunkee says 21 January 2009 at 15:20

I have a 1991 Nissan Sentra. Bought it new and continue to drive it with now almost 230,000 miles on it. I change the oil about every 7500 miles and maintain the car regularly as per most of the manufacturers recommendations (such as tuneups and replacement of filters, cleaning the injectors, flushes, etc). The air conditioner has worked well without incident since the beginning and the car continues to get between 28 and 32 MPG (sometimes with extended highway driving, 34 MPG). Except for routine brake (about every 60,000 miles) and tire replacement, the only major repair was having the transmission rebuilt for about \$2400 at around 175,000 miles. I intend to keep it until it gives me a real expensive reason not to.

127. earthluvr says 21 January 2009 at 15:44

Also, by choosing to drive an old car (with reasonable fuel efficiency) rather than buying a new one in the marketplace, you have significantly reduced the *enormous* carbon emissions necessary to create a new car, especially when considering the ecological impact of mining the original metallic ores. It amazes me to see people with just a few years on their small cars going out and buying a *new* Prius/hybrid and thinking they are doing the ecosystem a favor instead of exacting a high cost in new carbon emissions.

128. PizzaForADream.com says 21 January 2009 at 15:53

I’ve had my ’98 Honda Accord for 6 years now and it’s got over 260,000 miles on it and still going! My wife’s got a ’97 Ford Taurus that has 210,000 on it. We haven’t had car payments in over 10 years as we paid cash for both cars used. We’ll be trading in the Taurus for a used family van this year, but won’t do this until we have enough cash saved. It’s called the “one payment plan.” We prefer this payment plan over any other financing we seen!

129. Karen says 21 January 2009 at 16:12

Ah, yes, the old safety argument. Most people overestimate their risk of being in a serious car accident (it’s about 1 in 20, but most people guess it’s 1 in 2). Furthermore, the older you are, the less likely you are to engage in driving behaviors that lead to accidents. I suspect most Get Rich Slowly readers are cautious types and extremely unlikely to drive recklessly. Therefore, they are quite safe continuing to drive their paid-off, 15-year-old Hondas.

130. kelle says 21 January 2009 at 16:23

Two cents more. I’d prefer to ride a horse, but I’ve had more accidents with horses (brakes aren’t always reliable). Preventive maintenance, staying off the road as much as possible and good driving skills works best for safety, longevity of the vehicle and costs for.
My son worked for a Honda/VW dealership after graduation. He said he would never buy a VW because they were the ones coming in with problems 80% of the time.

131. Aleks says 21 January 2009 at 16:50

I used to drive an old car, it was 16 when it died. When I replaced it I got a 2007 Yaris. I considered buying another 10-year-old, but the difference this time was that I had the money. I’ve always bought the best car I could afford without going into debt. Now I have enough money that I can do that, and also get the car I want. And based on some napkin calculations, I don’t think it makes any difference financially.

My first car cost \$3000 and lasted 3 years (it also died at 16). My second car cost \$6600 and lasted 6 years. My new car cost \$15,700 and I don’t think it’s unreasonable to expect it to last 15 years. And for the majority of those years it will be idiosyncracy-free. My previous cars had minor anoyances like broken indicator lights and leaky trunks when I bought them, and didn’t develop any new ones.

I think the main things when buying a car are 1) don’t go into debt 2) don’t buy more car than you need, just because you want it 3) drive it into the ground

132. Stevi says 21 January 2009 at 17:13

My 1994 Ford Escort bit the dust in 2006, and I replaced it with a 2005 Mazda3. I’m committed to my “new” car for the long haul. The Ford suffered some abuse in the hands of previous owners, and if it could make it for 12 years, I know my precious Mazda will be reliable for years to come.

133. Sharon Rowe says 21 January 2009 at 17:26

I drive a 1997 Hyundai Elantra that I have been very happy with. On the other hand, I HATE my 2005 Ford Focus. It is the first American car I have ever purchased new and the last one I will ever buy.

134. TeresaA says 21 January 2009 at 18:38

Candy,

How on earth can you spend \$15,800.00 in repairs on a Pontiac? And then an additional \$7000.00??? I think the repair people/garages that you took your car to took advantage of you? I once had an engine replaced in a car and it was around \$3,000.00. That was pretty reasonable, as I have heard of engine replacement running around \$5,000 to \$6000.00. I don’t know much about auto repairs, but I think you would have had to replace virtually everything in your car to spend that kind of money.

Just curious….

135. TeresaA says 21 January 2009 at 19:28

I think everyone knows there comes a point when keeping your old car is not wise from either a safety standpoint or the amount of money you are spending in repairs.
Certainly there are a lot of factors to consider. I still think buying a safe used car, taking care of it, and making it last as long as possible, is usually the most frugal way to go. As with all things in life that are unpredictable, there is always a certain risk factor. Making informed and wise choices can help to minimize that risk.
If your used “paid for” car looks decent enough for you, runs well and is reasonably safe, there is nothing wrong with making it last as long as you possibly can!
If having a new car, or a good looking car or “comfortable” car is important to you…that’s okay too. Maybe you are frugal elsewhere? We all are different when it comes to the things that matter most to us. For me, a car is not high on my agenda. I’d rather save the money and spend it elsewhere on something that does matter to me or add to my retirement funds so that I can travel some day.

J.D.: Get Rich Slowly has helped me put into perspective what matters to me most and has helped me realize what my true goals are. The past year has been eye opening for me. I used to think I wanted and deserved all sorts of things. My wants are much simpler now, and my goal (and what I deserve) is to be free. Free to be able to do whatever I want whenever I want. There isn’t a car on earth that will ever make me feel as good as that.

136. El Cheapo says 21 January 2009 at 19:34

Those mid 90’s Geo Prizms were actually slightly upgraded Toyota Corollas, they were a joint venture between GM and Toyota. So not a big surprise that many of these are still on the road.

137. gfe--gluten free easily says 21 January 2009 at 19:58

1993 truck and 1994 car for us … I totally agree.

Shirley

138. ironsam says 21 January 2009 at 20:06

@Ryan2

—–
But your accounting is fuzzy, at best. By dispatching your car payment of \$250 monthly after four years, you are now “saving” \$250 monthly indefinitely? What if you had only financed the ‘95 Prism for one year instead of four? Then your monthly payments would have been close to \$1000; let’s say \$10,000 for the year. And you would have paid it off by 1996, right, so that’s 13 years ago, let’s see, carry the one…if you had just financed this for one year instead of four, by your logic you would have now “saved” \$130,000 instead of \$27,000. You can take this anywhere, and that’s the problem, it’s nonsensical.
—– (Ryan2)

You are taking Joel’s post out of context and arguing against something else. His point is entirely within the comparison of a specific alternative: getting a new car every four years. With this clearly defined juxtaposition, which you apparently can’t grasp, his point that he’s saved money each year he goes past the loan payoff date is entirely correct. Your example of increasing the payment amounts and shortening the time does not change or invalidate his point, and only illustrates your lack of understanding.

In another way, he could have posited that in 2008 he bought a pogo stick for \$60 instead of a private jet for \$40 million. In this clearly defined comparison he saved \$39,999,940 by foregoing the jet.

139. SimplyForties says 21 January 2009 at 20:39

After years and years of always having a new car, I paid one off for the first time about 1 1/2 years ago and plan to drive it until I can no longer depend on it. It’s a great feeling have that expense crossed off my list!

140. ryan says 21 January 2009 at 20:44

This is pretty much what I have always done. I have owned 4 cars since I was 16 and I am now 25. In that time my total out of pocket expense (for depreciation and cost of current car) for the cars that I have owned has been about 9K and about 5K in repairs. It is not like I have bought junk cars either I have owned a 1991 Blazer, 1993 3000GT, 1997 Lexus LS400, and 1999 Honda Accord(current car). The thing that I have found most important about buying used is buying cars with bullet proof drivetrains. This helps to ensure fewer trips to the mechanic. The Lexus and the Honda have proved to be the most reliable. The best recipe I have found is to buy cars that are about 7-8 yrs old that are Honda or Toyota and have suffered more than average depreciation. It has saved me a lot.

141. Avistew says 21 January 2009 at 21:48

Although not everybody can afford to do that, I save even more by not having a car.
My total cost is 50. When I’m in France, it’s â‚¬50, when I’m in Canada, it’s CAD50 (so, cheaper in Canada. But there is also less public transportation available there).

That’s the total cost per person, so as I’m married, it’s 100 for the two of us. We also don’t pay car insurance at all, or gas.

And, another very important saving as far as I am concerned is that neither of us has a licence. Registering for the test+lessons costs â‚¬1,000 here in France, and you don’t even have a guarantee to get it from the first try! If my husband and myself both tried getting a licence, we’d spend about two years worth of public transit for it, and that’s before any car-related cost.

As I said, not everybody can live without a car, and most people in North America can’t, so using an older one seems like the way to go there. Just thought I’d pitch in that an option to consider is not getting a car at all, if you can.

142. Greg says 21 January 2009 at 22:09

The only time this may not make sense, odddly, is right now. The reason? Interest rates.

I know Toyota is offering 0% on some cars, and others will probably follow shortly. And the bottom line is, if you’ll need to buy a car in the next 5 years, you almost HAVE to buy right now, because interest rates can only go up.

And as we all know, paying interest on a loan is just money down the toilet.

143. willamettejd says 21 January 2009 at 22:38

After witnessing various friends and family live/die/be severely injured in car accidents, I’m definitely struck by the fact that driving is the single most dangerous thing most of us do each day and each year. Cost, therefore, should not be the first concern. It is certainly possible, however, to incorporate safety as a top criteria along with value. Couple of points to consider when purchasing your next car

– Size matters. A lot. An accident in a compact or subcompact is 50% more likely to end in death than with a full-sized. Is that 3-5mpg you get in a compact over a full sized (e.g. 4 cyl civic vs. 4 cyl accord) really worth it?
– Black is the most accident prone color (hard to see at night)
– Remember active safety features –> stability control, daytime running lights, AWD (Subaru FTW!)
– Remember passive safety features –> collapsible steering column, multiple airbags, crash test ratings

Also, factor in time and consternation when purchasing an old car. Yes, it may only cost you \$1000 in maintenance per year, but how much are the headaches of repair shops, no-starts, etc worth? If you car is in the shop for a week?

144. willamettejd says 21 January 2009 at 22:51

One argument I hear against buying used cars and running them into the ground is: “It’s no fun to drive the same thing for 15 years.” I agree. I love cars.

So buy used and flip them.

Get a model that has already depreciated significantly, buy it for \$10K with 60K miles on it, drive it for two years (and keep it well maintained), and sell it for \$9K. Your “car payment” only amounted to \$41/month plus maintenance….it ends up being about the same as buying that \$10K car, driving it for 8 years, and ditching it for dirt cheap (between \$2K-\$3K), plus you’ll hopefully miss out on expensive maintenance (timing belts, major unanticipated repairs, etc) that need to take place between 90-120K miles.

145. Gordon says 22 January 2009 at 00:10

I sold my car a year ago after reading a book called How to Live Well Without Owning a Car. I now have more money to spend on other things and invest for my future. A car is sure a money burner sometime.

146. rail says 22 January 2009 at 00:26

One of the best pieces of advice I ever got was “a car will never make you money”. An old boss of mine told me that when I was about 19 and I will never forget it. Im 39 and have only bought one new vehicle in my life. I had a 87 dodge dakota pickup that I bought in january 96 with 100k on the ticker, drove it for another 100k untill the frame started to rust through in 04. I started to look for another used pickup and looked for a year, to no avail. The problem nowdays is that you cant find a good old used farm truck anymore. Either they are hi mile and shot or low mile queens with leather interior power everything and too many bells and whistles. Eventually I thought why not deal on a brand new truck and ORDER IT the way I want it. plain jane work horse, and not pay for junk on it I dont want. Ended up with a “heavy” half ton 4×4, small v-8, 5 speed, roll up windows, rubber floor mat, etc. for just under 20 grand. Its paid off, sits in the shed when not in use, and has only 30 thousand miles. I will own it untill the body rusts off of the frame rails. I drive to work in a 82 Buick that I inherited so that also keeps my costs down.
Don’t get me wrong,I love cars. I still own a 46 GMC pickup I’ve had since high school, and also own 2 motor cycles. I feel that the old truck and the bikes are ok to own in that they are all used/old and depreciated out. Also they are starting to apreciate because of their age. As far as people being leery of old cars on account of safety, I just dont get it. How did we Americans get to be so afraid of our cars. Hell, not 30 years ago hardly anybody wore seat belts and we shurly didnt have car seats. Never mind airbags, passive restraint, crumple zone, ad infintum. Most yuppies today would have a cow if they had to drive a 70 chevy down the highway today, much less any car from the 50’s. Get over it people. You dont have to drive a rolling bank vault to be safe. Try DRIVING safetly and AVOIDING accidents.

147. A Girl in Debt says 22 January 2009 at 01:48

I currently have a car payment of \$180/mo because of a car accident (100% not my fault) which smashed my ’95 paid HONDA CIVIC. It had about 290k miles on it.

I have hopes of repairing the old ’95 and selling the car I’m currently paying on to get rid of my car payments.

What a great car it was.

148. Jennifer Singh says 22 January 2009 at 05:12

THANK YOU! My 1998 Honda Civic has been payment-free for three and a half years, and my husband’s car has been payment-free for a few months now. Inspired by this post, I just logged off of my ING Direct account after setting up my very own Car Savings account. You know how they say “If my experience could help just one person, it would be worth it?” Well here I am — you’ve directly helped me to make this wise choice. THANK YOU!

149. BSK says 22 January 2009 at 06:22

We have two older vehicles. 1995 Ford Escort Wagon with 211K miles and a 1999 Ford Econoline Van with 147K miles. We have not had a car payment in many years. Fortunately both vehicles have had little repairs required and we stay on top of regular oil changes etc. We have very low insurance which saves money as well.

My company recently moved locations,adding 90 miles to my commute daily. We were faced with the possibility of our high mileage car not lasting, or using too much gas on driving the van. I found an existing carpool and offered to “pay my way” for a seat. So now I pay a low daily fee to the driver, and my car stays in the park and ride location. Which will extend its life for many more years(fingers crossed).

We try to walk whenever possible, ride our bikes, or plan routes for errands if we must drive. Unfortunately where we live there is no public transportation system.

We have had people ask us why we are not helping out the economy in buying a new vehicle (we live in Michigan). But my response is we are helping out our family economy first!

150. David says 22 January 2009 at 06:27

Awesome – I have the exact same 95 Geo Prizm that has served me well for many years.

151. Anne says 22 January 2009 at 06:51

My car will be paid off this Sept. Can’t wait! Yes, it was bought new, but at the time we (my husband and I) didn’t know better. We did get a 0% interest rate on it though, and it is the only car we have between us. We share it and a bus pass. We plan on keeping our car until it doesn’t work anymore. It hasn’t really had any big repairs, just breaks and tires and oil changes and we just replaced the battery a couple of weeks ago after 4 years.

I’m glad to have found this site, it brings to light a lot of good points and different and better ways to think about money.

Thanks for doing it JD!

152. Cyllya says 22 January 2009 at 08:18

Seems like Geo Prisms are pretty good. Last year my mom bought a 96 Prism for me to use for only \$2500. It already had 155,000 miles and I added another 20,000. Unless the odometer was broken, it got 50 miles per gallon!!!

But all sorts of plastic bits on the inside of the car kept breaking. (Most significantly, the inside driver door handle broke. I had to roll down the window every time I wanted to get out.) I was worried that a critical engine part would be the next thing to break, and it would do so while I was going 65 down the highway. So I gave the Prism back to my mom and bought an under-priced 2002 Ford Taurus for \$2000. I hope the Taurus will be good for many more years, but I’m really hard on cars, so maybe it won’t be. 🙂 Well, I can get another old one cheap.

I feel like I have the best of both worlds: I have no car payment, but I DO power windows and locks.

153. Ricky says 22 January 2009 at 08:27

Hi,

I think this is a great post, I too agree that overall the savings outweigh the benefits of having a “new” car.

we did just that when we first moved to Arizona, we drove our car from Canada, that was still being paid for, we actually paid it off early, and we were driving for about 2 years with no payments, we saved that extra money and along the same lines we bought a used car when we needed a 2nd car, and we managed to save quite a bit by buying a car that was about 4 years old at the time we got it, and had an excellent history, so we had no repair costs other than regular maintenance.

We then did the same thing once we moved here to the UK, I found an excellent condition Audi A4 on e-bay, and I paid 530GBP for it, it was 12 years old when I bought it, but here they have to pass roadworthy tests every year, to be allowed on the road, it had low miles for it’s age and had everything I needed. now I get a car allowance from my employer, and that all goes in the bank, as insurance is cheap, maintenance is the most expensive thing but that is once a year.

now the smart thing I am working on is funding my own life insurance policy with the savings, which will allow me to withdraw the funds when I like and an added bonus have life insurance policy in effect for the future.

154. Steve says 22 January 2009 at 08:41

Good thinking, but what happens when you break down on the highway, or even locally – that’s got to happen eventually, when you talk about “driving a car into the ground”.

What would happen if your car didn’t start in the winter, and you had a child with you? And what if you were far from home – on a day trip or even a vacation? Or worse, what if you had an unforseeable problem and the car failed as you were actually driving it – again, with others in the car?

This kind of thinking has lead me to keep my car current. I think people tend to fantasize that when their car dies, it always happens peacefully in front of their house. But I’ve had the opposite experience, and it’s dangerous – AND, it forces you (if you have a job that you need to drive to daily, like most people) to rush your decision on what new car to get. You may even need to get a rental car for some time, too – and you could miss work and other important events.

Some thoughts to consider.

155. Chris says 22 January 2009 at 08:44

Besides marrying the wrong person, I feel cars can be the single largest detriment to a person’s financial life. If you saddle yourself with car payment early on, it is extremely difficult to ever get ahead.

SAVE and buy a reliable used car. Keep saving and upgrade when you can afford to. A nice car should be the LAST luxury you buy. Cars will not get you laid, having money in the bank and the associated confidence WILL… Probably. 🙂

156. Linda says 22 January 2009 at 08:50

My 1987 (yes, going on 22 years old!) Camry is still chugging along and currently serves as my son’s transportation. It’s getting to the point where she’ll be retiring soon; fenders are rusting badly and oil is leaking, among a few other things. I say ride ’em as long as you can!

157. James says 22 January 2009 at 09:13

This is a great post. I cannot believe that you have only paid \$2,000 for your care over the course of 13 years! This is the most astonishing thing to me. I am actually kind of surprised and really happy for you.

I need to purchase a Geo. By the way a great post!

158. Russell S says 22 January 2009 at 09:44

I am currently driving a 1995 Camry that has 107.000miles.

Been in our family since new, I gave my mom a nominal sum (2,000) towards her down payment on a new camry.

I spend 40\$ per month in gas, 60 a month for full coverage insurance.

I save over 6,000 a year vs buying a new maxima or camry (based on 400/mo pmt/ – 120/mo for insurance)

given the Camry had an oil change every 3,000miles *mom is very diligent* – I can put another 5yrs or 100K on this Camry with only typical repairs (ie. brakes/oil/tires)

that 30K will be my down payment for a condo.

159. Ryan K from Going Carless says 22 January 2009 at 10:09

You admitted that you did not factor tires and oil changes because they were expenses no matter what car you drive. There are other car related expenses. Insurance being the largest. Gas follows cloesly behind that. Then there are all of the countless little expenses like filling your tires for a few cents, tire rotations, registration, washer fluid, car washes, the plush dice in the mirror, air fresheners, tire pressure guages, ice scrapers, and on and on…

My solution? Sell my car and go completely car-free. Sure I still spend some money on my bike, but it’s a small fraction of what I paid for my car.

160. M says 22 January 2009 at 10:10

I bought a 2007 Toyota Yaris in August of 2006 brand new. It was the least expensive car with the highest gas mileage and reliability I could find. I paid less than \$12,000 for it and it gets 40-45 MPG. It is paid off, and I plan on driving it to the ground! I drive 90 miles a day for work, and though the car is barely 2 1/2 years old, already has 66,000 miles. My goal for her (yes, it’s a female because she’s so darn cute!) is to hit 250,000 miles. If i continue to drive as much as I do now, it would be in 7 more years that the car would hit this number.

Hubby is wanting me to get a new car so he can have the cute one, but I’m not giving her up! I want to be there when she hits 250,000+ miles.

~M

161. Scordo.com says 22 January 2009 at 10:17

I’m sure others have commented on this, but one must also weigh safety and performance versus the cost to purchase a new vehicle.

I’m curious if the vehicle the author has driven for 13 years has stability control, anti lock brakes, airbags, etc.? I, for one, would not sacrifice safety over keeping my car running for as long as possible. Modern vehicles are designed to last for a longer time period, but again key factors to consider when deciding whether to purchase a new car include safety and performance and not just saving \$\$\$.

Best,
Scordo.com

162. Candy says 22 January 2009 at 11:01

Teresa (#134),
The pontiac was a grand am that I drove about 18,000 miles a year. I feel like I replaced the majority of the parts at least once. I replaced the engine two days after the warranty expired (unfortunately on Christmas Eve) and that was the most expensive repair for about \$8,000 and I also had to replace the brakes at that time. The mechanic showed me a part of the metal (from the engine?) that was rusting from the inside and the metal was weakened enough to shove a pencil through the metal wall.

I replaced the tires three times, the alternator twice, and miscellaneous other big chunks of car parts. The next round of repairs to do included the entire ac system (since some plastic parts were breaking off from somewhere inside and lodging in the filter), the brakes again, the exhaust system, and many other small parts. Maybe substandard parts were originally used, but it felt like a continous cycle of constant repair of things breaking apart and mechanics surprised that the car was running after parts broke off or deteriorated.

163. PDXgirl says 22 January 2009 at 11:44

Safety-

My 1997 Ford Escort had the transmission blow up (not literally, but almost!) in 2001… my 2003 Taurus crinkled like an accordion when I was in a 20-25 mph accident in 2007 (I stopped in traffic, the guy behind me didn’t, I’m guessing on his speed) causing \$8,000 worth of damage.

My 1982 Volvo is a freaking tank! and since I have it maintained regularly by a Volvo mechanic, he actually anticipates what needs to be done, and repairs are so easy he’s shown me several I can do myself (for example, there is a hose that will occaisionally pop off when starting the car, all I have to do is pop it back, it takes under 2 minutes.

However, I don’t have kids and I don’t drive out of town in this car (we drive the other slightly newer volvo out of town) I use this pretty much for commuting 7 miles to work and back and to get groceries. It would be different if I had to lug around a couple of children or had to drive a very long distance.

164. Bryan says 22 January 2009 at 12:05

Nine years ago we purchased a 2000 Honda Civic EX. We paid the car off about five years ago. It hasn’t needed any major repairs so I haven’t had that \$320 payment for a long time.

My other car is a 1990 Acura Integra GS Sedan that I bought 2 1/2 years ago for \$450 cash. I immediately had to replace the front axles (the reason I didn’t pay closer to the \$2000 blue book value) and got a full check up. Between that and the registration I only paid about \$1000 for the car. That fall I had to put new tires on for about \$450. In the time I’ve had the car it’s been a great, reliable car and it’s in great shape. All for less than \$1000 a year.

It’s great to know that I don’t have a car payment on top of all my other bills since I am being laid off in a eleven days.

165. Anne says 22 January 2009 at 12:20

Regarding all of these safety comments.

As the driver of an older car I would say that yes, I am quite aware that my ’96 Corrola is nowhere near as safe as my dad’s ’06 Camry with all the bells and whistles. I understand that it would quickly get me to another state if there was a family emergency, but I would think long and hard about using it for a planned interstate trip vs. a new model rental.

But you have to understand that a lengthy commute that includes highways or other major roads isn’t part of the daily routine for a lot of folks. I drive my micro-commute slowly and safely on mostly residential streets. I found an apartment based on the location of my office. I hate driving and have tried to minimize it in my life. I could walk but… not a morning person and that extra 20 minutes of sleep is worth it to me.

I don’t begrudge anyone who has a work/life that doesn’t fit in with my model a nice, safe car that is capable of taking care of their needs. Same goes for folks with kids.

I guess re-reading these comments it does come across a little “ha ha my old car totally wins.” I certainly didn’t mean it that way. It’s more just a silly point of pride. My beat up Birkenstock shoes are 6 years old – also a silly point of pride. And a lot of folks do get some crap about their cars so there’s gonna be some bitterness. I think what most of us can probably agree on is that the decision on what car to drive and when to replace it should be given a lot of though as a major financial decision rather than “ooh, slick ride.” And for me the best realistic and financial decision is to keep driving the old guy until he falls apart.

166. Becky says 22 January 2009 at 13:18

I drive a BMW that is now 17 years young. She had a little work on the transmission 2 years ago, and I replaced the a/c over 8 years ago. Her bell and whistles are okay. I do like that she have the weather band on the radio. That has come in handy at times. She drives like a tank, but is so smooth and fast on the road. They just don’t make cars like they use to.

167. Don says 22 January 2009 at 13:45

I am quite aware that my ‘96 Corrola is nowhere near as safe as my dad’s ‘06 Camry with all the bells and whistles.

I’d dispute that. The 06 may be safer, but to say that the older vehicle is “nowhere near” as safe is a strong statement that I think is hard to back up.

By 96 all cars had airbags and it’s very possible for a 96 to have anti-lock brakes. While it might be that the 06 has side-curtain airbags there’s still plenty of cars sold new now that lack them.

There’s a lot of people making the case for newer cars up above in ways that simply do not add up savings-wise. Certainly there’s nothing wrong with prioritizing a newer car above other choices, but it simply cannot be shown to be superior financially.

Even the most squishy and unprovable claims about being stranded by the side of the road don’t add up. AAA memberships are under \$200 a year and provide unlimited towing. Rental cars are available for around \$30 a day, so even if you had to have your vehicle towed and rent a replacement car for several days it would be impossible to add up expenses that match the cost of a new vehicle.

168. scordo.com says 22 January 2009 at 13:55

Hi Don,

There is actually tons of data on car safety available. The National Highway Traffic Safety Institute crash tests every single model sold in the US and that data is pretty clear.

Moreover, most industry expert would agree that modern safety features, such as:

1. Electronic stability control
2. Anti-lock brakes
3. Side impact airbags (front and rear)

all contribute to making a newer vehicle safer than “most” older vehicles on the rode today.

I can’t certainly make the argument to someone looking to save money by holding on to his/her car for as long as possible (that is indeed the right *financial* move) to purchase a new vehicle with the right safety options, but I can tell you that I would want my family in a modern vehicle versus a MY ’96 with limited safety options. Not all consumer product choices are about saving money.

My two cents.

169. H.G. says 22 January 2009 at 13:58

93 Lincoln Town Car for a daily here, only 16 years young with 144k. Had transmission work 3 years ago, and is now starting to show rust on some rough edges. Not as good on gas as some of the newer smaller cars, but I bet it is a whole lot safer, especially in these tough chicago winters.

And no, they don’t make cars like they used to.

170. Kathy F says 22 January 2009 at 14:14

I have had only 3 cars in almost 30 years First in college, a used 1975 Toyota Corolla that had 70,000 miles, cost \$2000. I crashed and totaled it in 1983 with 150,000 miles. Ran just fine until I crashed it. Insurance company gave me too much money for its loss because the odometer read 50,000 and they did not know it was actually 150,000 miles. Even after I told them, the agent told me to keep the money because it was too much hassle for them to redo the check.

Then I bought a 1984 Toyota Corolla that I drove for 10 years with about 120,000 miles. For the last three years, something was sticking in the carburetor linkage, which I had to loosen up by pumping the acclerator pedal every time I started it from cold engine and finally one winter day in extremely cold weather I just could not get it started at all. In its waning years, if I wanted to take a long distance trip, I just rented a car. Still cheaper than new car payments every month.

In 1994 I bought a new Geo Prizm which now has about 50,000 miles and I still drive with no problems. I use mass transit during the weekdays, hence the low mileage for a almost 15 year old car. But I will continue to drive this car until maintenance gets to be too expensive. I can probably get another 5 years out of it the way things are going. It has two front airbags and antilock brakes, which were the lastest safety features back in 1994.

171. Big Car Luver says 22 January 2009 at 14:21

Mini Coopers are gooberish and unconfortable, why would anyone want one? The point of this article is not about mini’s so please stop referring to them. The article is a wonderful example of what Americans should do, it would help us all when the occasional economic depression hits. I have a 1998 car, bought used with 30k miles, still running to this day. Sure, 1 of the windows doesn’t roll down, it has 200k of milage, and the AC no longer works, but I luv it and always will. Who cares if its starting to rust and is all banged up, it gets me around, its cheap to maintain, and it suits my personality. BTW, one other thing, you forgot license plate expenses and sales tax. Keeping your car longer saves you there too!

172. Slinky says 22 January 2009 at 15:56

I just replaced my ’91 Dodge Dynasty with a new ’08 Scion tC. I plan to drive it for at the very least, the next ten years.

173. JC says 22 January 2009 at 16:30

wow, long, long discussion. I have nothing to add except that I have been driving the same car I was given since I turned 16. It’s a ’94 Accord. I am still driving it today, 6 years later with no major issues. It has been such a good car. I also love not being in debt just to own a fancy automobile.

174. jtimberman says 22 January 2009 at 17:06

Factoid, per the American Auto Dealer Association, the average car payment in the US is ~\$484 over 84 months. Consider that when making calculations for cost savings over time.

175. bethh says 22 January 2009 at 17:22

Hi, my name is Beth, and I also think Minis are SO CUTE. I have a coworker who learned to drive at almost-40 so she could have one. My dad heard me waxing enthusiastic about one, and said I could afford one, I should get it! But I told him I’m just not interested in a car payment, which he seemed to understand.

I’m 37 and I’ve never had a new car. I didn’t have any car at all until I was 26 and got a job that would require a non-transit-able commute. I paid cash for a 13-year-old Honda and drove it until it was cruelly totaled by a Cadillac, a few months shy of its 21st birthday. Since I still needed a car for my job, I bought a year-old Hyundai with 15k miles on it, for \$6000. I’m sad to say I financed it (at a low rate!) but I did pay it off early. That car is now 5 years old and has under 44k miles on it.

In 2006 I moved to the Bay Area and deliberately moved close to work so my commute (and life) does NOT require having a car. So, if it ever dies, I can take my time and really think about what I want/need to do.

I am NOT saving lots of money for a new car, though. I’m saving for a big trip and have a final 5k to pay off on student loans – but then I will start putting money away. The car should last another 5 years, easily, so we’ll see what I’ve got in the bank by then, and what my life is like – those factors will dictate what I buy as a replacement!

I love hearing that all sorts of people are in agreement – paid-for is awesome.

176. rail says 22 January 2009 at 18:56

I dont mean to sound all snarky and all, but many of the above comments about car “safety” have me chuckling. Some of the comments by posters in this discustion give me pause. How come just because a car is say 10 yrs. old it is now “not as safe”? Am I going to die if I get in my 82 Buick and drive to work? Folks, this is not some arbitrary thing with the age of the car. Please, we need to have the mentality of the Germans when it comes to driving. Put down the cell phone and the mini tv sets etc. Concentrate on DRIVING THE DAMN CAR. I dont care if you ride a skate board to work,or a D9 Bulldozer. If you dont put yourself in the position to have a wreck you wont get hurt. Obviously, statistics of miles driven will play into the equation of your chances of getting hurt; and yes I have been in a crash myself. Driving old cars for the last 25 years has not put me in mortal danger and I dont fear the reaper every second Im in a old car.
We take risks every time we walk out of our home to do any task. Americans have much more to worry about than if we have the newest air bag technoligy riding shotgun with us every second of the day! Sorry for the rant/ramble/tangent! Just had to get it off my chest.

177. Siby says 22 January 2009 at 22:45

Agree and disagree. 🙂
Disagree, if you are yet to have a car which meets safety, comfort requirements.
Agree, if you have bought the first one a comfortable car which caters to most of yours and family’s requirements.

178. Greg C. says 23 January 2009 at 03:57

I read around 1/3 of the posts- just too many to read now. Just some comments and thoughts-
I tend to agree with the most recent post I read on the safety issue. I value safety, but the idea that cars are really unsafe because they are a little old doesn’t make much sense to me. People tend to use irrational fear as a motivator, and to me- well I’m not that scared for my safety. Or I would never leave the house. Driving a car has a certain amount of risk, and I think that except in extreme cases safety is used as a rationalization for what really amounts to wanting a new car.

And there is nothing wrong with wanting a new car, IMO.

I just sold my 14 year old car and replaced it with nothing. The maintenance cost was really low- I had only driven 1000 miles in 3 years or so. I just felt like I couldn’t keep paying the insurance and registration for the use I was getting. I only got around 500 bucks- and I used it to pay medical bills for my son. I will be sharing my wife’s 12 year old car.

As far as repair costs, I honestly don’t know how to compare- since most cars are going to have the same maintenance costs regardless. Parts wear and need to be replaced. unless we are talking major repairs like engine, transmission,etc. The only things I have paid for in the last 4-5 years are oil changes, tuneup-plugs/wires, brakes, muffler. All of that combined is around \$600.

My 14 year old car some typical repair costs were \$120 for new tires, \$169 for timing belt, \$200 for brakes. I’ve never had these \$1000 tires and everything else other people seem to have.

People always respond with the “get rid of the car and be a walking biking enviro” posts. There are practical considerations. For one, most people commute to work in the U.S. And that usually involves freeway driving. Pedestrians and cyclists are banned from many roads, and even if they weren’t it would not be safe to attempt.

Fortunately ( or Unfortunately since I would make more money if I could work outside of the home), I work at home. Our combined household driving is 400 miles a month. At the highest prices we never spent more than \$50 a month in gas. Most of that is from taking kids to activities.

Still in the very near future, I wouldn’t mind getting a brand new car. It will be garaged and well maintained, and hopefully in 10 years will only have 50,000 miles and be like new.

179. Frank Stallone says 23 January 2009 at 04:34

I love my 1987 Mercedes 300TD Diesel. Cost a little bit more to repair than a Geo Prizm but still less than a new car payment every month. My girlfriend has a 2004 Suzuki SX4 and I bet that would last her 20 years.

180. Joel says 23 January 2009 at 10:45

I’m in the process of driving a ’97 Volvo 850 and a ’98 VW Jetta GL into the ground. (The Volvo has a warped head, so that will happen sooner rather than later.) It’s cheaper to keep these two going than it is to buy new vehicles.

A word about the Autozone lifetime warranties: if I remember correctly, only the original part has a lifetime warranty. The replacement part has a 90-day warranty. Still not bad.

181. Michele says 23 January 2009 at 12:30

I’ve been wondering if the old car thing is really worth it for us in the long run. It seems like there’s always something self-destructing in our household of old cars (even though we are careful about upkeep) and the aggravation has to have cash value. I’ve never bought a car on credit, though, so I don’t do comparisons on a monthly cost basis.

We just pumped a thousand bucks of repairs into a fifteen-year old car…it’s hard to know when it’s time to give up.

182. perries says 23 January 2009 at 14:51

Oh terrific piece – I drive a 1993 Civic that I bought used (50k mileage) in 1996 and paid off in ’99. The insurance and car tax is negligable. It’s the most reliable car I’ve ever driven, as well as being now the oldest car I’ve ever driven. And another thing, if it gets a ding or a scratch – who cares?

I hope when the time comes I will buy another reliable moneysaving gem like this one.

183. Shadox says 23 January 2009 at 19:11

That’s hilarious – I could have written this post myself… I drive a Geo Prizm 1997, with approximately 120,000 miles on it. It runs very well, doesn’t need a lot of maintenance and takes me to work and back. Why spend money on a new car when you old one works fine?

184. Peter says 23 January 2009 at 20:19

I wish I had such luck with second had cars. My last two cars were new and at least I was able to get things done under warranty. I’m in Australia so we don’t have the same warranties for second hand cars as you have in the US.

I’m now driving a car I actually own. I haven’t had any kind of car debt for over a year now. I was paying about \$330 (Australian) per month on my car loan.

I’ll keep my car for probably at least another 12 months. It’s a 2002 Hyundai Accent and it’s done nearly 150,000 kilometers (roughly 93,000 miles). The engine has seen better days and I can’t justify spending about \$1800 (Australian) in getting it reconditioned.

I’m hoping to save roughly at least 50% deposit on a new car loan when the time comes. I’m considering a Hyundai i30 with a Diesel engine. The cost of petrol (gasoline) has gone down a bit here recently but the forecast is for it to starting climbing again in about 6 or so months. So Diesel is an attractive option for me. I’ve looked at Hybrid cars but they are so much more expensive to buy here than a Diesel car.

185. Emily says 24 January 2009 at 07:46

My very first car was 12 years old when I got it as a hand-me-down from my father. It was a 1990 BMW and I was its fourth owner. I got another five years out of it before it finally died just as I finished college. (“Died” in this case meaning “needed repairs more expensive than I was willing to sink into it.”) So aiming for 17 sounds completely reasonable to me!

I *loved* that car, and now I’m a huge proponent of driving old cars.

One thing that helped me make it last for cheap was lucking into a wonderful mechanic. When my hood got dented in by some huge SUV in a parking lot, most places I went to wanted to charge me an arm and a leg for a difficult-to-find replacement. The last guy I went to managed to reshape it – with his own hands! – free of charge. Needless to say, he was my go-to mechanic from there on out.

186. Xavier says 24 January 2009 at 13:19

Nice to read 🙂 I simply can’t understand people spending all that money on a brand new car every 3 year. At least that’s what a lot of people do or dream of here in Belgium. I don’t need electrical windows, airco and all those ESP-gadgets. Back to basics, we’re spending more time in traffics jams at 30 km/h and looking for a parking spot anyway.

My first car was a 1996 VW Golf III TDI (diesel, 90 hp). Bought it with 130.000 kms on the clocks and a 12m warranty. Plenty of room, and only burning ca 6 liters every 100 kms. Why do we need a fuel guzzling 200hp car anyway? Fuel costed here almost 1.5â‚¬/lit last summer…

The engine got replaced with a cheap secondhand block at 275.000 kms. The turbo blew all its lube oil into the engine and dead it was.
I changed the muffler, and all 4 shocks a bit later.

You know what…I’m still driving it. I don’t care for a scratch. I keep it clean and the oil (from the supermarket)level ok, now and then new brake pads, tyres and filters and off we go.

Meanwhile it has 380.000 kms and still runs.
Not to bad for a car that I bought for 8.100 â‚¬, 8 years ago. Furthermore no one is trying to steal this one.

Friends with a Toyota Corrola or Nissan have similar stories. So guys, crisis? Let the others buy a new one. Then, go out and buy their good nice secondhand cars.

187. Bob says 24 January 2009 at 16:11

Great post! I am going through this right now, too. This past summer, my wife and I purchased a 13-year old car, in absolute pristine condition. It’s a 1996 Porsche 911. It’s actually a 911 model type 993, which Porsche made from 1995-1998.

Although it was pretty expensive (\$47,000) we paid cash for it and did not go into any debt. Maintenance-wise, it’s been incredible with zero issues in 10,000+ miles. (The 993 is known for superior reliability and the shop that inspected it for me could not believe it was in practically new condition.)

The insurance for it is also extremely reasonable, actually less than we pay for our other car, a Toyota.

Overall, we are very pleased and excited to finally be able to own a Porsche and are convinced that this purchase will actually save us a ton of money over the long term.

Thanks.

188. Lainie says 24 January 2009 at 17:02

I drive a 1991 Honda, and it looks awful but runs well. It’s been very cheap to own and run, and I’m lucky to have the awesome Hoshi Motors here in Boulder to repair it. A few things —

– It’s also very cheap to register the plates annually.
– On the downside, old Hondas are actually the MOST stolen vehicles, and mine was indeed stolen a couple of years ago (and recovered).
– Also on the downside, I find myself less willing to drive far from home or in city traffic, in part because my car doesn’t have air bags. Safety technology is the one thing that newer cars can really claim as a benefit.

189. claire7676 says 26 January 2009 at 09:46

I would love to drive my little 98 Mercury Tracer (173K miles & counting!) into the ground, but I plan on having kids in the next 2-3 years. Considering how great the car’s been so far, it could very well last that long. If it does, I will have to give it up for a larger, safer car for my kiddies.

Also, if the author has been concerned enough about car payments to drive his own car for so long, why wouldn’t he wait until he had enough cash to buy the car outright? That is hopefully going to be what I’ll be doing. It just makes more sense.

190. Daryl says 26 January 2009 at 12:04

Obviously, you have been very thorough in your analysis of when to repair or buy a vehicle. I would not argue with anything you have said. I would just like to suggest a slightly different method. I include an “R or R” (repair or replace)item in my regular budget. I contribute to this account every month, regardless of what happens, so when I have to face the decision to repair or replace, there is always money there to work with. It works for me.

191. Joel says 27 January 2009 at 06:48

Thanks J.D. for posting this story and thanks to all the readers for the good comments.

192. Parker says 31 January 2009 at 15:42

I agree that:

2) driving them for 5-6+ years

will save you a ton of money compared to most Americans. But there’s a time to be penny-wise and a time not to be pound-foolish.

Here’s what I mean. There have been numerous safety advances since 1995. According to Informed for Life ( http://www.informedforlife.org/demos/FCKeditor/UserFiles/File/DEathRatescombined1994to2004alpha.pdf ), the 1994-97 Geo Prizm had 125 driver deaths per million miles, among the worst 25% of cars on the road. By comparison, the 2001-2004 Infiniti G35 had 11 deaths per million miles. Today’s cars are MUCH safer still.

What are your health and safety really worth?

It’s the same question I ask Smart, err, DumbCar owners who are so proud of their MPG.

Bottom line, cars are never solely a transportation expense, so you can’t look at it from solely that perspective.

193. Jason says 31 January 2009 at 16:52

I agree that safety is an issue–my wife always gets the new(er)car, and drives it until it is worth getting a newer one. When is that? For me, my ownership threshold is .10 per mile. In otherwords, if I buy a \$20,000 car, it has to last 200,000 miles. following this formula, I can buy an older car, and drive it a few thousand miles, and be happy (and on budget) or buy a newer car, and own it longer. Note: I don’t include repairs, since I consider that the cost of ownership, regardless of the car. I just buy cars with good records, and good reliability ratings.
And with the money I save, I can buy other cars that I enjoy–right now, that’s about 30 cars, from Buicks to Triumphs to Camaros…all paid for, all enjoyed, with no remorse over a car payment each month.

There is even a strong argument to be made for owning (and driving) an older collector car. One in 2 or 3 condition, well maintained and driven moderately will depreciate less than a newer car, and will get you into a whole lot more conversations about your ‘sweet ride’. I mean, seriously, when is the last time someone pulled up next to your new toyota and asked ‘Hey, how much a month you pay for that thing’ 🙂

194. Peter says 31 January 2009 at 19:50

What are the current estimates for how much the cost of crude oil will go up by and over what period of time? In Australia I’ve heard that the price of petrol (gasoline) will eventually go up to \$5 Australian per litre compared to the current price of about \$1.30 Australian per litre.

It’s good to save money by buying a second hand car but a person still needs to factor this into the equation. I mean you could save a lot on the purchase price of a second hand car but if the price of oil skyrockets in a relatively short period then you might find yourself wishing you’d bought that hybrid or diesel engine car.

195. The Frugalist says 01 February 2009 at 11:00

I do the same as you. My car is now 10 years old and has almost 200 000 miles on and it is stil going strong. I plan on driving it for as long as having it costs me less than a newer car.

196. Jeremiah says 01 February 2009 at 21:42

@ Josh Baugher, Parker, i mostly agree with the all safety arguments – i mean, logically you want the safest car possible.

But that’s still a very passive point of view. The car’s safety features like safety belts and airbags are an absolute last-ditch line of defense – they only work when you’re in an collision.

A true investment towards ensuring your safety while driving would be taking advanced driver training courses so you will be better equipped to avoid “accidents” altogether. I say “accident” sarcastically there because all but a tiny tiny fraction of driving incidents are due to driver error.

I could argue another angle: if you are truly a safe and alert driver, having all that extra safety gear on-board that you’ll never use is a waste of money that’s eating up your fuel economy with extra weight.

I’d put my money on a pro driver in a Geo over commuter Joe in a Volvo any day.

That’s sort of an extreme way to put things. But if we’re really talking about saving money here, a 10 year old car + \$2000 of driver training is still cheaper than a new “safer” car. And those skills apply to every other car you drive for the rest of your life.

197. econobiker says 03 February 2009 at 16:03

I started with the 10 year minimum car ownership plan too! I own car 5 years with a bank (or less depending on loan terms), then 5 years outright, and then everyday past that 10 years is gravy. And the best is that repair info and parts are easy to find- repair info via the internet and the junkyard for some, and the aftermarket autoparts stores for others. I just resoldered my cars instrument panel and saved myself \$20 over buying a junkyard one!!!

1995 Dodge Neon- 4dr, 5sp, 30ishmpg, run until it falls apart…

198. jack says 04 February 2009 at 08:16

This actually is the best article, I’ve ever read on the reasons to keep a reasonable used car. A lot of writers or investors will state that you can earn 10% percent on money you don’t put toward a new car. They call this opportunity cost. 10% is a lie. They use the 10% figure to strengthen their argument of keeping your old car. 5% opportunity cost is a much more accurate number. If these bull-shitters were earning 10% on their money, they wouldn’t be be trying to sell their books, or getting you to put up your money.

This is an honest, straightforward article. I would only add, one point. If you can keep repairs, on average, to \$1500 per year, or less, on your used car, it’s worth keeping. You will have an expensive year at some point, because a transmission may need to be rebuilt,or an engine. However, these are things that need to replaced at some point- and makes ecconomic sense if it allows you to keep driving your old car for many more years to come.

199. pamela says 07 February 2009 at 06:13

Great!! My husband and I just replaced our 1993 Pontiac Bonneville. It was great to have no car payments. A few years ago we started a savings account for a newer car as we knew that the Bonneville would not last much longer. We were able to pay cash for a used van a month ago!

200. fern says 07 February 2009 at 09:48

We just gave up our 14 yr old Toyota Corolla with 235,000 miles on it. We bought it used 12 1/2 yrs ago for a little over \$13000. It needed only basic maintenance and a few repairs. Recently it started to need more repairs and we made the decision to get rid of it–it also got to the point where it was not going to be safe or reliable for the amount of long distance driving my husband does. So, we bought another used corolla–1 yr old for \$14000. We expect to have this one for a long time, too.

201. Peggy E says 07 February 2009 at 11:06

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!

202. Jenn Calling Home says 07 February 2009 at 13:02

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.

203. Catherine @ Frugal Homemaker Plus says 07 February 2009 at 20:24

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!

204. Harper says 07 February 2009 at 21:05

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.

205. margalit says 08 February 2009 at 11:08

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!

206. Jenna @ Newlyweds says 09 February 2009 at 09:16

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

207. mmclassics says 09 February 2009 at 20:35

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!

208. jack says 10 February 2009 at 13:58

I think your calculations are fine, they make perfect sense.

209. Sally Parrott Ashbrook says 10 February 2009 at 15:37

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. 🙂

210. Roblynn says 13 February 2009 at 11:56

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.

211. Fred says 20 February 2009 at 15:46

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.

212. Jeremiah says 20 February 2009 at 16:08

@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.

213. Terrin says 22 February 2009 at 09:23

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.

214. Wain says 28 February 2009 at 12:27

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.

215. Hilarie says 04 March 2009 at 07:29

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!

216. Golfing Girl says 04 March 2009 at 08:10

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.

217. Captain Audio says 04 March 2009 at 08:47

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.

218. Tom777 says 09 March 2009 at 07:49

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.

219. TonyK says 11 May 2009 at 09:29

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.

220. chimanga williams says 26 May 2009 at 15:14

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.

221. Michael says 09 June 2009 at 22:59

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.

222. steve says 27 June 2009 at 18:35

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.

• Willy Long says 02 February 2018 at 15:33

Good luck with that car. Usually about 80k electrical and transmission problems start. Also the plastic exhaust manifolds leak.

223. Melissa says 12 July 2009 at 22:05

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.

224. Bstrong says 20 July 2009 at 18:27

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.

225. Rick says 24 July 2009 at 14:40

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.

226. Josh says 29 September 2009 at 05:39

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.

227. Michael says 30 September 2009 at 20:58

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).

228. kyle says 02 November 2009 at 14:14

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.

229. eavenue says 02 November 2009 at 15:48

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.

230. Minimalist says 01 January 2010 at 13:35

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.

231. Ace says 05 January 2010 at 18:26

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.

232. Janice says 11 January 2010 at 16:07

I love these posts!

233. Live Rich on Le\$\$ with CA\$H ONLY says 11 January 2010 at 19:37

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.

234. Jamie says 14 January 2010 at 18:08

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.

235. ian says 21 January 2010 at 13:13

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

236. Nils says 28 February 2010 at 20:54

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 🙂

237. Brian B says 17 March 2010 at 09:48

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.

• Willy Long says 02 February 2018 at 15:35

The mistake was buying GM,which is notorious for poor production during those years. Go import always.

238. heather says 22 March 2010 at 10:20

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.

239. Ben Cote says 13 May 2010 at 10:14

Thanks for this great post. I have a 19 year old Ford Ranger and I love it.

http://www.trulysimple.com/

thanks again

Ben…

240. sam says 20 May 2010 at 03:20

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.

241. Istvan says 31 May 2010 at 10:58

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 🙂

242. frantic1971 says 09 September 2010 at 18:26

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.

243. Phil Johnson says 09 September 2010 at 21:52

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.

244. Kingyo says 07 November 2010 at 23:58

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).

245. John Doe says 21 December 2010 at 13:18

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.

246. nadim says 04 May 2011 at 09:35

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.

247. Mad Mick says 02 June 2011 at 17:44

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

248. Kai says 10 December 2011 at 23:44

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!

249. Hamish says 03 March 2012 at 09:08

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.

250. Slava says 18 April 2012 at 17:33

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!

251. Annoymous says 04 May 2012 at 04:02

Only a poor man would drive a 13 year old car! I am 20 years old and work in fast food and I drive a new BMW M3! I would look down on a person like yourself! My friends and me would call you a “total looser”.

252. Slava says 04 May 2012 at 07:07

I can not be responsible for stupidity of your friends. If you compere what have Volvo 940 2.3 Turbo to what have BMW. Most of the things (such a power options, acceleration and etc will be the same or very close) So if you and your friends ready to pay \$30000 instead of \$3000 and loose \$20000 in first 5 years sorry to tel you but your guys are stupid.

253. Slava says 04 May 2012 at 07:09

But probably the issue is girls does not give you , you you need to show up the car. In this case it probably good investment.:-))

254. Annoymous says 13 May 2012 at 11:04

M3 starts at \$63,000 and my total was \$71,389.00 on the invoice. I had to have my parents co-sign the lease papers because it was beyond my salary!

255. Franzi says 19 June 2012 at 05:25

Great article. I drive a 95 Corolla myself,which is a mechanical twin of your Prism. I saved a lot of money.I pay nothing.It sips fuel.It looks newer than many 5 year old cars around. there are no confusing and power consuming gadgets.The benefits are too long to list. Keeping it till the engine gives up,but I think that will be years from now,considering it runs still perfect.

• Slava says 19 June 2012 at 06:53

Those cars runs about 600000km with right maintenance, so you have really long time till engine give up:-))

256. Nate says 02 July 2012 at 21:00

On some level I agree with the principles of your article, especially re: being car payment free for x-amount of years, which is a no brainer for the financially savvy, you miss a few points.

You cannot quantify or put a price tag on driving enjoyment for people who actually LIKE cars and don’t just see them as an appliance that gets them from point A to point B. People who love cars would rather take the bus than drive a 13 year old Geo Prizm, myself included. That car sucks, period. I live in L.A. and have to drive a LOT. People in LA probably spend more time in their cars then people from other cities and I have owned and driven 10+ year old beater, shitty econoboxes and it is depressing. It is depressing funneling money into an old shit pile just to keep it running. Your 13 year old Prizm lacks so many things compared to newer cars that I don’t even know where to begin, but you can bet its definitely not as safe as newer cars. How do you think your shit heap car would hold up in an accident? Does it have the power or handling to get out of a sticky situation, quickly? Probably not. But at least you’ll have more money in the bank when you are 75. That’ll be sweet!

I drive a 2010 VW GTI that I plan to keep for around 100k miles. By 50k miles it’ll be paid off (1.9%apr on my 4 year loan) and I’ll get another 4 years or so of no payments. During that time I’ll keep paying myself the amount of my car payment so that when the GTI hits 90k miles, I can sell it, combine that with what Ive been saving in the car fund and get another premium German sport compact or sports sedan. Maybe upstream to a CPO, slightly used Audi. You know why? Because I appreciate well made, supremely engineered cars, I love driving them and I want to enjoy the car I have to be in every day, day in and day out.

You can have your Prizm and your extra money you squirreled away. Have fun trying to enjoy your life when your joints hurt too much for you to walk. Great plan!

• Scott says 02 March 2016 at 16:21

Can’t believe the idiots on this forum! Most of you would live in a squat, just to drive a ‘New’ car! I don’t understand what Is so important spending Â£40,000 odd, on a new car, when their are thousands of lovely second hand cars available to buy! Probably the same idiots, who buy a new car, and then renew It one year later, because the new model has ‘Bluetooth’!!! What Is wrong with saving money for your retirement? You can keep buying your new cars, as when you retire you won’t have any money left! After wasting It on plastic overpriced cars!! People are so materialistic these days, ‘Look at me, look at me, look at me!!!! Idiots….

• Bill says 07 March 2016 at 05:00

I can say from the people I know (middle aged family types) who buy their cars new, they’re not doing so to impress anyone (which would be obvious by the car choice) – they’re buying new so they don’t have to spend their times worrying about mechanical problems, safety issues, or minor but ongoing repairs.

Ever take a family car trip to a place that you’ve taken vacation time to visit, taken kids out of school, made hotel reservations, and have a limited time to enjoy? Even a day or weekend trip, like to the beach?

What do you do when your car breaks down in the middle of that trip, and you lose days or maybe the entire vacation. Assuming you had enough finances to afford a new car but opted not to so you could save, can you imagine explaining your choice to your kids? It wouldn’t matter because they wouldn’t understand anyway – they’ll just miss out on the experience. And you’ll lose some of the cash you were so worried about saving.

I’m not saying new cars are for everyone, but I wouldn’t go around assuming everyone who buys one is materialistic.

257. Steve says 06 June 2013 at 11:31

You had a great run with your Geo Prizm. Congrats. Sometimes cars, even good cars, start stalling and failing as hoses and lines and other parts age. Rental car fees to get to work while your main ride is being fixed add up. It also adds to the headaches. At some point perhaps even you will have to get another used vehicle. Perhaps have to cheap cars is the way to go…?

258. PapillonWings says 04 August 2013 at 08:32

I’m looking at getting a 1998 Geo Prizm from a mechanic that replaced the engine and repainted it. He said he checked it out and there is nothing wrong with it. I was worried about getting a car so old but I figured that if I’m getting it from someone that fixes cars for a living it should be safe. He is only asking \$2350 for it.
I have a 2003 Concord that is given me the blues. It needs a new engine and I don’t want to sink any more money into it.
I’m not looking to impress anyone. I just want a car that’s safe, reliable, and works.

259. Ed says 11 October 2013 at 00:22

Congratulations on living on the cheap….I guess. :/

I have a 12 year old car for commuting, but I also have a brand new one. I just like wearing nice clothes, having lots of hobbies, riding a carbon fiber road bike, living in a nice house, and having a new car. I guess that’s why I work hard and make good money…in a job I like.

Most of you car-cheapo’s are not car enthusiasts…or any other type of enthusiasts. Like my parents, you probably just sit home and watch TV.

• Jennifer says 29 October 2016 at 19:59

I love to travel and have been to probably many more places than you. I’ve lived in expensive houses, flown first class quite a bit, and I love cars. While I’ve driven countless brand new luxury cars (not test drives either 😉 I still have been in the cheapo car camp for most of my life, and now that I can drive countless nice cars I choose to drive an old car. Life for me is about enjoying relationships and experiences. Plus I don’t like projecting a wealthy appearance to strangers.

You may place a premium on buying expensive things that you can show off to your suburban neighbors, probably things you started wanting due to all of the TV ads you watch while sitting at home, but insulting the interests of others just because you don’t manage your money as frugally??? It takes ____ to insult someone’s virtues or good traits.

260. Wally says 23 December 2013 at 09:50

WOW! Not to brag but I have you all beat, I was given a not running 1947 Jeep 20 years ago, rebuilt it and painted it myself completely for \$3,000 doing the work myself and have been driving it ever since. Nothing ever goes wrong with it and I constantly get offers for far more than I ever invested in it. No goverment regulation, emission test exempt, antique vehicle license plates that are a permanant plate that have never to be renewed. Full insurance is about 5 dollars a month. In the summer, I take the top off and it’s more fun than any sports car, simple heavy duty 4 wheel drive that will take you anywhere. One of the best decisions I ever made.

261. Robbin says 16 January 2014 at 14:12

Even if you are innocent you can be forced to carry SR-22 insurance, even if you are innocent you may have to pay the \$250.
The fact that the operator has a non-owner coverage will not excuse the operator for not having coverage on the vehicle.

One of the first complete necessities found in society
relies on cash.

262. Tera says 26 February 2014 at 13:52

I enjoyed the story. It makes so much sense to me due to the fact I can’t afford a down payment. Thanks for posting this story. I will repair my 95 Accord and open a savings for my daughter.

263. Megaputz says 22 September 2014 at 18:59

I think kinda the same…

I bought a 4 door 1996 2.0L, 5 speed Dodge Neon a little over 3 years ago for. 140,000 miles. It was a beater. The kid I bought it off of had tried to modify it. Turn it into a racer… huge spoiler and all. Melted the fuse box under the hood with the sound system he had installed.

I bought it for mileage. They get around 30MPG and I was driving a 98 Blazer at the time and was just tired of the car. Despite the 4×4, trailer package and it was fully loaded, I payed \$5000 for the blazer with \$89,000 miles.

I owned the Neon outright. My figuring the gas savings alone would pay for the car. There were a laundry list of problems like the exhaust system, cracked windshield and bald tires. The car was not loved… I work on my own cars so no big deal. With the internet and manuals a car owner can do a bit. There are two salvage yards near where I live. As Joel said, many auto parts stores offer lifetime warranty. If had to do work much of it would never have to be payed for again. Aside from my own time.

I have to admit the car is great to drive. It’s like a go-cart It gets spectacular gas mileage. It has to be one of the simpler cars to work on. Pretty darn reliable. Even considering there was always something wrong. Always something on the list of things to fix.

Considering the number of miles on the car and neglect. I quickly learned the common issues and the intricacies of the engine and other components. What to look for and prioritize over such things as body work. First priority is state emissions/safety inspection. Emissions goes along with economy. So if it’s good on gas that is money I can spend on repairs or elsewhere.

My reasoning was If I had a car payment it would be about \$200 a month for a used car and about twice that for a new car. Any used car I bought I’d most likely have to put money into it.
So my plan was long haul. Make the warranty at the auto store count. Utilize salvage yards.
My budget has been to spend \$100 a month on maintenance. So far I have stayed within that budget. I have put close to \$4000 into the car since I bought it. Much of it in the first year of buying the car. Again with long term goals in mind. Get the big stuff out of the way… The common issues. Rely on warranties after that. Once you buy a part with LLT you seldom have to worry about it… at least not paying for new parts. I have replaced the steering rack twice and tie rods a few times.

I have even gone so far as to add a class 3 trailer package on my car. I have two flatbed trailers, 8’x4′ and 12’x5′ and a 4’x8′ enclosed trailer. The little car can haul nearly a tonne of dead weight. It also doubles as a pickup truck. I can leave the truck bed where I want though.

My one concern is body/frame rust. Once it gets so far. It doesn’t matter how great a car runs.
Have started experimenting with body work. Fabricating, welding in new steel, painting.

Joel, if you still have that Geo and enjoy driving it. Keep it. If anything buy another cheap beater. One thing I love about Neon’s is their longevity, interchangeability and the availability of parts even between other models.

After driving a car for such a long time. A change of pace maybe. It doesn’t have to be a Geo, maybe a truck. Find something you’ll enjoy. Something simple to work on. Keep the Geo as a standby. Work on either vehicle at your leisure or pimp it out and make it fun or give it more utility.

If you can find a inexpensive used car for under \$1,000 do some reading on it. If you work on cars you should have an idea of their common problems. Issues like blowing transmissions, rust rot, engines. How many do you see on the road. Some makes/models are a pain to work on. Foreign cars tend to be more pricey in parts. A car/truck may have no room to work in the engine compartment.

For me. Working on cars is not always a chore. It’s part of learning about the vehicle, relaxing. A project car that you actually get to drive a few times a week. Wealth in knowledge you can profit from. I work on other cars for friends, family and neighbors and their kin. I get to learn about other vehicles and get payed. Money I can invest in parts and tools to make jobs easier.

I recently bought a 2001 Dodge stratus with 160,000 miles on it for \$500. It is an upgrade from the Neon. It has a nearly identical engine. It’s fuel economy isn’t as good but it’s a proven design. This one has a blown head gasket but that can be swapped out in a day along with the timing belt kit, head gasket, and tuneup. That can be done in 8-10 hours. Still for under 1k the car will be ready for the road with a clean title. And so it will begin again.

I have seen people who buy new cars. Within a year they’re still making payments. There are terrible drivers around here… Within that same year you’ll see ‘battle damage’ from winter driving. Average deductible is \$500. I could get another car for that price.
My neighbor lost his job and could no longer make the payments. His car was repossessed.

Cars are transportation. Pretty much disposable. They only cost you money. I can’t se saving up 10k and spending it on a car, interest, fees and maintenance from them on. I can see some don’t know how or can’t stand working on cars.
Do what works for you. I like Joel’s line of thinking.

264. Fel says 16 November 2014 at 19:38

Reminds me of a joke” mom saved \$2.00 today i ran behind a bus to school!!! Son u r so silly why didnt u run behind a taxi u could save 10 dollars lol

265. Irving Bailey says 12 December 2014 at 13:50

Well, I think people who wants to drive older car they feel more comfortable with them rather than a new car. I have never had good luck with second hand cars or anything that are old. I have to go for the new one.

266. A Jay says 01 July 2015 at 23:32

Great post! Drive a 04 Honda Civic, will definitely keep it after reading this.

267. Ed Conrad says 03 August 2015 at 05:17

The logic of driving an old car “until the wheels fall off” applies if you don’t really have to depend on the car AND if you’re not a car enthusiast.

Some people actually like the finer things in life like eating fancy food, taking international trips, driving a NICE CAR, wearing nice clothes, etc.

Since you’re probably going to take all that money with you after you die…knock yourself out and drive that beater! 🙂

• Jennifer Harper says 29 October 2016 at 19:45

Lol I think everyone enjoys those things, but unless you’re rich you can’t have it all. He will probably spend his money before he dies, just on things like personal freedom and a retirement with good food and no worries. 😉 Besides, some people do want to leave some wealth behind to their loved ones when they die.

• GodGuns&Gravy says 25 January 2017 at 10:14

Read “The Millionaire Next Door” and get back to me.

268. dequan says 02 December 2015 at 11:00

13+ should have cars

• jg says 05 July 2016 at 12:44

The new car thing is a choice and not always a good one. I have two cars that are both 21 years old. A Jaguar and a Porsche. Both have over 100K miles. Yes I have to do some expensive repairs now and then but it works out well for me. Both the NEW Jag and NEW Porsche are pretty but they are not built as well as the older cars. If you know something about cars you will know this to be true. Once the warranties are up the repairs do not make financial sense on these new computerized cars. Remember most new cars can only be worked on by the manufacture so they have you. Instead of doing a repair the car companies will put you in a lease which most people are going to do.

269. Brian Richards says 24 November 2016 at 20:31

I just bought an ’03 Hyundai Santa Fe with 120k miles on it. It’s in very good condition, with very little rust. I swapped out the timing belt and water pump, and the engine runs very smoothly, and overall, the suv is a joy to drive. It’s not very fuel efficient, but it’s got some power, is good in the winter, and should last me to 200k+ miles. At any rate, I’ll drive it till it dies.

270. Dale and Sally says 10 January 2017 at 10:04

I agree driving the same car for decades will save you money. I also think living in a one room apartment in an urban area will save lots of money. Both ideas seem crazy to me. I wouldn’t drive a brand new Prism not alone a 20 year old one. If you only put \$2000 into this car since you owned it then there are many things wrong with the car. Your car is not safe and a hazard to other drivers. Try to live and enjoy life instead of worry about money.

271. Murgatroyd says 05 February 2017 at 10:32

Buying new cars all the time just to impress friends/colleagues makes you poor. Choose wisely but aim to keep your cars for around 10 years instead of changing them every 3/4 years. There is no reason why a modern car should not last 15+ years if it is looked after properly.

272. Sam says 19 May 2019 at 03:17

I drive my first ever car purchase from July of 1998. My Jeep Cherokee now has 438k trouble free hellish Chicago miles on her, never let me down or major repairs.. wife has 80k dollar car and we CONSTANTLY fight because she wants me to get a new car… maybe I’ll just spend that new car money on a lawyer..