How do you know how much car?

[ilikemusubi]

So my partner and I are currently saving for a new vehicle.
Our 1997 Jeep's doors are literally falling off (driver's side to be exact) and we are funneling more money into than we should.

While we both ride our bikes during the summer months, we live in Wyoming and bike riding all-year round is not possible due to a variety of factors.

We are looking at a Tacoma. They tend to last a long time with proper maintenance and offer us the 4x4 capability we need during the winter to get to work.

The biggest question we keep asking ourselves is: how much is the right answer? 4 year old Tacoma's are 35K where we live. At that point, I see us just making a lump sum payment against our mortgage principal instead of buying the car, even though we need the car. For $15k, we can get a 10-12 year old Tacoma with 1xx,xxx miles. At that point, we wouldn't feel bad about not paying off more mortgage principal, but then we run the risk of getting a vehicle that wont last as long.

For our financials, we have no debt but our mortgage, which is $332k.

How did you navigate buying a vehicle and comparing it to paying off debt?

[Sibley]

Well first, there's an argument to be made that you shouldn't be paying off the mortgage. I'm not paying mine off beyond required payments because I can earn more money on just about anything else.

You need a vehicle, and one that the door is going to fall off while you're driving is not ok. I do not want your door to hit me! So, you find a vehicle that fits your needs, you can afford, and just accept that this is the reality of needing a vehicle. A $35k vehicle doesn't seem terribly unreasonable to me, though I have no idea what your used car market is like.

And remember, if you pay cash for a vehicle that means you didn't add to the debt.

[Dave1442397]

The Tacoma is a great truck, but watch out for frame rust. The problem was supposed to be fixed for the latest generation, but I'd still want a good inspection if I were buying a used one, especially if your area uses salt on the roads.

My brother-in-law had his frame replaced under warranty, and he had more than 200k miles on it at the time. I think he had it for 20 years in total, mostly in Pensacola, Florida, before selling it and buying a new truck, also a Toyota, but I forget which one.

[Morning Glory]

Do you really need a 4x4 truck?  Do you need the clearance because they don't plow the road or are you just worried about sliding around?
I lived in Minnesota for years and found that tires make more of a difference than type of vehicle.  I actually prefer a small front wheel drive car with good snow tires over an SUV or truck because the braking distance is shorter. You can get a spare set of rims from the junkyard to make switching the tires easier. My coworker had a long commute and drove a prius year round. I know your hills are a bit steeper but do some of your neighbors get by with regular cars?

[RWD]

The answer to "how much car" is the best vehicle you can afford without compromising your long term financial goals. Or, alternatively, the cheapest car you can find that still meets your needs. You didn't lay out your whole financial picture so it is hard to say what that means for you, but it sounds like $35k isn't comfortable.

A 10 year old 100k-mile Tacoma should have no issue going another 100k miles/10 years with regular maintenance. Assuming rust is not an issue. There are always trade-offs you can make. Newer is more expensive but reliability should be more predictable and it should have better safety, efficiency, features, etc..

As far as paying down/staying out of debt it's a noble goal (and understandable at 6%), but don't go cash poor for it. If paying extra on your mortgage means you can't just casually drop $20-30k in cash for a new car or house repair or some emergency then you've been too aggressive paying down that debt. Consider financing a vehicle even if you have the cash just to keep yourself liquid. You should be able to get a 2-3 year loan at 4-5% (which makes a lot of sense when you have other higher interest debt already).

[GilesMM]

Do you really want a pickup?  If not, there are other Toyota offerings that will get you around in winter with good snow tires, e.g. 4Runner, Highlander, even RAV4.  Like all Toyotas, if reasonably well maintained, they are good for 200-300,000 miles.


I like to buy cars with just over 100,000 miles as there seems to be a depreciation inflection point around that extra zero.

[ChpBstrd]

Can you hold out a few more months for the 2025 Toyota Stout?

Think under $30k and maybe 35mpg. Basically a Ford Maverick with Toyota reliability and durability.

Tacoma has evolved into a pretty truck, not at all economical.

[sonofsven]

Look into a Nissan Frontier as a possible vehicle in lieu of a Tacoma. They are just as capable, and in some respects are better featured, than the Tacoma. Where the Toyota really shines is resale value, as you've seen with your dealership example of a three year old truck for $40k, which I think you were smart to avoid.
The "Tacomatax" is real.
I'm on my fourth Nissan 4x: '81, '91 (still own), '12, and '22.
The 2012 I sold at just under 200k and it was absolutely trouble free up to that point.
My opinion on these mid size trucks is that the discount for buying a 3-4 year old truck is not great enough compared to buying new, especially if you can get a better rate for buying new.
I would look into an older Frontier with 100+K, something from 2010 to2016 or so.
The Frontier was essentially unchanged from 2005 to 2020, so while the early model years had a few issues by the middle of the run they had it straightened out.

[RWD]

The dealership offered us 5.99% at 36 months for the 2021 Tacoma at $40k. However, after sleeping on it, we just didn’t feel comfortable taking out such a large loan after closing on our house.

You can get loans on used cars too (the last time I did this was for only $11k). And the dealership is unlikely to get you the best rate unless they have some special promotion. Usually I've found credit unions to be the best option. The credit union I used for our last two used cars is offering 3.99% which would be silly not to take when money market funds are yielding 5%+. You also don't have to finance the whole thing (it's not all or nothing).

[EchoStache]

Why not something like a Subaru Crosstrek?   Good ground clearance, over 30 mpg, under $30k, even brand new. 

[LD_TAndK]

Why not something like a Subaru Crosstrek?   Good ground clearance, over 30 mpg, under $30k, even brand new.

Best bang for your buck for ground clearance and AWD. Far better gas mileage as well. No sense buying a fancy pants truck for 4x4

[Laura33]

We were originally considering the frontier, but the resale value of the tacoma was appeasing (on paper.....10 years from now).

Resale value is irrelevant if you drive it until the doors fall off.

The way you make a good decision is by very clearly defining your needs, and then choosing the least-expensive option that meets those needs.  If you choose a more-expensive vehicle than you actually need, understand that you are doing so because of some additional benefit it provides, and make sure you agree that getting that additional benefit is the best possible use for the extra money you're paying. 

For example:  you reasonably need ground clearance and AWD/4WD.  That does not mean you need a pickup.*  There is a huge variety of vehicles available that meet those needs, many of which will get better gas mileage than a pickup.  So why are you focused on a pickup?  (Hint:  if it's "because I want to be able to do XYZ," ask yourself whether you actually do XYZ often enough to justify the upcharge -- humans are very, very good at rationalizing what we want).

And:  you want a reliable vehicle that is cheap to maintain and will last a long time.  That does not mean you need a Toyota.  There are many, many vehicles out there that will last you 100,000 miles or more, and many of those do not in fact involve a Toyota Tax. 

Much of reaching FI is learning to think outside our preconceived notions, because those notions have been formed by a very consumerist society that values bigger and better and newer.  So define your needs as objectively as you can.  Then do your research on the kinds of vehicles that meet those needs (FWIW, I like Edmunds as a reasonable car site for that sort of thing).  And when you get the inevitable knee-jerk "I don't want that," challenge your own thinking, really examine why something that makes the most sense on paper "feels" wrong.  The process is going to be hella uncomfortable.  But most useful things are.


*Really, are pickups that great in the snow?  I'd expect the lack of weight on the back wheels would make bad-weather handling kind of questionable.