help us do a car reset

[ultros1234]

Hey mustachians --

So... I recently totaled the family car. We have a second car that we were already thinking of replacing: it runs, but it has some serious issues that are not worth fixing, and we were using it as, basically, an emergency backup. The totaled car was financed; we will walk away from the accident with a $1300 insurance payout, all told. The "emergency backup" car is paid for; we'd be lucky if we could sell it for $1k.

To put a positive spin on the situation, we have an opportunity to start from scratch on our car situation. I'd love the mustache community's input about how to best optimize our situation, especially your feedback on specific models we should target in the used car market.

About our needs:

• It's me and my wife and our two kiddos. Looking forward a few months to post-pandemic, I'll be working from home most of the time. My wife will be commuting ~15-20 miles/day most of the time. The kiddos will have mostly-not-overlapping school dropoffs.
• I think we need to remain a 2-car family. I used to commute the kiddos to school in a bike trailer daily, but we moved to a car-dependent area.
• BUT the good news is, car #2 would not be needed very often, and we could shift most of our miles onto car #1.
• At least one car needs to comfortably fit 5+ people. But doesn't have to be the one we use all the time

So let's call car #1 the "Commuter" and car #2 the "Backup." Here's my rough thinking about how to optimize:

• Commuter is optimized for fuel efficiency. We plan to always drive Commuter unless there's a reason not to.
• Since Commuter is where we spend most of our time, we're willing to be a little face punchy on some fancy things, like a decent bluetooth connection, safety features like rear cameras, etc.
• Backup is optimized for carrying extra people and stuff when needed, and perhaps driving into the snow. (We're 90 minutes from Lake Tahoe.)  4WD would be nice.

Given all that, here's some questions for you all?

• Thoughts about what Commuter should be? We're thinking things like ~5 yr old Prius or Honda Accord hybrid.
• Should we be considering a plug-in car for Commuter? We would have to run the electrical into the garage.
• Thoughts about Backup? I'm thinking maybe an older SUV -- fine if it's not fancypants, fine if it's older or high mileage, as long as I can be confident that it can navigate a snowy mountain road without falling apart.

[zolotiyeruki]

I think you're on the right track for the commuter, although I'd add "hybrid camry" to the list of candidates.

For car #2, get a minivan.  If AWD is that important to you (and it probably isn't as important as you think), you can get an AWD Toyota Sienna.  Minivans over SUVs any day of the week.  Better gas mileage, better cargo space, easier to get in/out, drives better, and most likely cheaper.

[RWD]

What about an electric car for the commuter? You can get a less than 5 year old Kia Soul EV, Nissan LEAF, VW e-Golf, or Chevy Bolt for between $10-15k.

For the backup my first thought was a ~10 year old Subaru Outback. Should be between $5-10k and will be one of the best options for snowy mountain roads, plenty of space, and will hold its value well.

[ultros1234]

Thanks! These are all good thoughts.

We are considering doing the face punchiest thing ever and buying a NEW car for the Commuter. I never in my life thought I'd buy a new car, but the 2021 Toyota Prius Prime is currently running a deal where they knock $5k off the sticker price, and then we qualify for about $6500 in tax incentives, which brings the price down to about $19,500. Since these 5yo hybrids seem like they're easily $15k with 50k miles on it -- there's just not much daylight between that and the brand new one. Am I insane? It's only the tax incentives that make it worth considering.

I'm not sure if we can get away with 100% electric, but perhaps I should be considering it? I like the idea of the Prime, where the first 25 miles are always electric, and then hybrid gas kicks in past that. Seems like we'd get like 80% of the benefit of a fully electric car (and the same tax incentives) while also retaining the flexibility of taking the occasional longer trip. How's the cabin space on the fully electric cars? We are cramming two car seats in back for a while, and ideally even in the commuter we'd like to be able to fit a third adult between them.

[ultros1234]

Another thought: I see that one can get a used Nissan Leaf for REALLY cheap. I'm seeing plenty of 2017 era cars for around $6-8k with sub-40k miles on them. Suspiciously cheap.

The internet tells me they're so cheap because of degradation of the battery. Seems like there's a cottage industry in Nissan Leaf battery replacement. Any insight about these?

[robartsd]

Another thought: I see that one can get a used Nissan Leaf for REALLY cheap. I'm seeing plenty of 2017 era cars for around $6-8k with sub-40k miles on them. Suspiciously cheap.

The internet tells me they're so cheap because of degradation of the battery. Seems like there's a cottage industry in Nissan Leaf battery replacement. Any insight about these?

The battery degrades because it does not have an active cooling system. Heat kills batteries and is particularly hard on Li-ion chemistries that just about everything rechargeable uses these days. If you can usually avoid exposing the car to heat, the leaf could be a better value to you than to most people. Should certainly confirm battery health and/or cost of replacement before buying a Leaf.

[joemandadman189]

are your kids in car seats? we have a 2018 honda odyessy and a 2010 Mazda 3 hatchback both front wheel drive, but snow tires on them and they are fine

[travel2020]

Another thought: I see that one can get a used Nissan Leaf for REALLY cheap. I'm seeing plenty of 2017 era cars for around $6-8k with sub-40k miles on them. Suspiciously cheap.

The internet tells me they're so cheap because of degradation of the battery. Seems like there's a cottage industry in Nissan Leaf battery replacement. Any insight about these?

A neighbor of ours bought a used Leaf recently for a similar price and loves it. He doesn’t have a charger but uses public charging stations to charge it. Goes 60-70 miles per charge so as long as that covers your daily commute range, might not be bad to look more closely.

[DeniseNJ]

Watch Scotty Kilmer on YouTube.  Then buy a Toyota.

[ericrugiero]

I never in my life thought I'd buy a new car, but the 2021 Toyota Prius Prime is currently running a deal where they knock $5k off the sticker price, and then we qualify for about $6500 in tax incentives, which brings the price down to about $19,500. Since these 5yo hybrids seem like they're easily $15k with 50k miles on it -- there's just not much daylight between that and the brand new one. Am I insane? It's only the tax incentives that make it worth considering.

I would absolutely buy a new Toyota over a 5 year old one for a $4500 difference.  But, does that fit your finances??  You had a payment on your previous car.  That makes me question whether you can really afford a $19500 car?  A used Leaf might fit your budget better. 

Also, for the 2nd car, a minvan is extremely practical for hauling lots of stuff and people.  Snow tires are great in the winter and your minivan with snow tires will do better than an SUV with regular tires. 

[ultros1234]

We sat down last night and decided we're buying the new Prius Prime. I did a cost of ownership analysis in a fancy spreadsheet, and between all the tax incentives for buying a plugin hybrid and the almost-zero cost of gas, the Prime winds up being cheaper than used cars, not only in the long run but the short run, too.

So the real question is, would it be better to be driving around an older, cheaper car overall? And that's where my wife just puts her foot down and says that she wants a low-mileage, newer car to be our primary vehicle.

I would absolutely buy a new Toyota over a 5 year old one for a $4500 difference.  But, does that fit your finances??  You had a payment on your previous car.  That makes me question whether you can really afford a $19500 car?  A used Leaf might fit your budget better. 

We did have a payment on the prior car, mostly because interest rates were/are so low (2% on prior loan). New car will have a higher payment, but if you combine the monthly payment plus gas cost, it winds up being about the same as what we were doing before. I don't love the idea of carrying debt for a car, but we'd be better off socking that extra money into tax advantaged savings or even paying down mortgage (at 3%).

[ericrugiero]

We did have a payment on the prior car, mostly because interest rates were/are so low (2% on prior loan). New car will have a higher payment, but if you combine the monthly payment plus gas cost, it winds up being about the same as what we were doing before. I don't love the idea of carrying debt for a car, but we'd be better off socking that extra money into tax advantaged savings or even paying down mortgage (at 3%).

If you can really afford the $19,500 car and are just making payments to optimize (like the don't pay of your mortgage folks) then my hesitation is withdrawn.  Sounds like a good decision.  That car should hold it's value well, be cheap to operate and be reliable for a long time. 

[ultros1234]

Did I convince mustachians that buying a new car is a good idea? Checking to make sure there are no flying pigs outside my window.

Seriously, I reflected yesterday that this is exactly how these tax credits are supposed to work: If the feds and the state of CA weren't kicking in $6500 to defray this cost, it would make zero sense to buy new, and I'd wind up with probably a used conventional hybrid. But by putting in those subsidies, they'll successfully put a new EV on the road. As a policy wonk myself, makes me happy.

[RWD]

Did I convince mustachians that buying a new car is a good idea? Checking to make sure there are no flying pigs outside my window.

Seriously, I reflected yesterday that this is exactly how these tax credits are supposed to work: If the feds and the state of CA weren't kicking in $6500 to defray this cost, it would make zero sense to buy new, and I'd wind up with probably a used conventional hybrid. But by putting in those subsidies, they'll successfully put a new EV on the road. As a policy wonk myself, makes me happy.

The incentives for plug-ins/EVs definitely sways the math for new cars. Hard to pass up especially if you were shopping for relatively new vehicles to begin with. It does vary by state and specific model but some new cars are amazing deals.

[ericrugiero]

Did I convince mustachians that buying a new car is a good idea? Checking to make sure there are no flying pigs outside my window.

Seriously, I reflected yesterday that this is exactly how these tax credits are supposed to work: If the feds and the state of CA weren't kicking in $6500 to defray this cost, it would make zero sense to buy new, and I'd wind up with probably a used conventional hybrid. But by putting in those subsidies, they'll successfully put a new EV on the road. As a policy wonk myself, makes me happy.

The incentives for plug-ins/EVs definitely sways the math for new cars. Hard to pass up especially if you were shopping for relatively new vehicles to begin with. It does vary by state and specific model but some new cars are amazing deals.

In general I still think it's a bad idea but you have brought up one of the few cases where I think it makes sense financially.