Is your Honda Pilot paid off? It's a sub-optimal vehicle in terms of MPG but with two growing children and not a lot of driving it may be good choice unless you're going to take a significant deprecation hit holding on to the vehicle. There will be transaction costs associated with acquiring a new (used) vehicle which may not be offset by improved mileage, particularly with the CRV option.
My thought as well. If the OP can get his annual mileage down below 10,000, the Pilot probably has another five years in it at least.
I'd be surprised that it's cheaper to sell the Pilot and buy at 2016 crossover of any sort on a monthly cost of ownership basis over any timeline.
If the goal is to drive down the cost of transportation as far as possible, keeping the Pilot seems like a clear winner to me, unless there's something about it we don't know.
Buying a newish crossover seems like an expensive consolation prize for doing some downsizing, not a method of budget optimization.
@caleb &
@FLAFI - I've tried putting pencil to paper to find the most optimal option. Feel free to help me out if you see something missing. I'm going to provide real world examples and estimates based on a few CRVs we are considering below, but also consider that having a rock solid vehicle for the next 10+ years provides peace of mind for my wife so if the numbers are close we'll probably proceed with going the CRV route (detailing the Pilot today to get her ready for Craigslist and Facebook :)
Pilot current value (what I actually think I will get in cash) = $6,000
Cost of 2016 CRV SE with 25,000 miles (all in price) = $18,000
Net cash flow loss = ($12,000)
Timeline of test = 5 years. We'll assume no major repairs on either outside of oil changes, etc., but for the Pilot let's budget in an extra $500/year in maintenance. I think that would be a safe assumption. Could be high or low, but we gotta start somewhere. So I'm down $12,000, but adding back $2,500 in anticipated maintenance costs - Net loss of ($9,500)
Let's assume the 10,000 miles/year for 5 years = 50,000 miles driven total
Pilot = 18 MPG combined = 2,778 gallons at an est avg of $2.50 per gallon (currently $2.20 gal locally) = $6,944 in gas
CRV = 31 MPG combined = 1,613 gallons at $2.50/gallon = $4,033 in gas
Now my net loss is down to ($6,589)
But let's then look and see what the values of the cars will be in five years. We have no way of knowing exactly, but I think a decent way of looking at it would be to find the private party value of those cars today, but five model years older with 50,000 more miles.
According to KBB private party value, a 2004 Pilot with all my same options with 262,000 miles is worth $3,300. I don't know if you have ever tried to sell a car with that many miles (I have), but your market is pretty much nil. I'd be surprised if I could get $3,000 for it.
According to KBB private party value, a 2011 CRV with all the same options with 75,000 miles is worth $10,700. Finding a low mileage, well taken care of CRV is next to impossible (I've been looking for months). For the ones that do exist, the owner wants as much or more than a dealer would. I have no problem believing I could get $10,500 for it.
So a net gain of $7,500 for the CRV. At this point it looks like the CRV is up by almost $1K.
The one thing we left out was time value of money and/or interest expense if getting a loan. I'd pay off the CRV after selling the Pilot if I don't sell it beforehand, but I'll grant you a fully financed CRV at 4% interest over five years. That comes out to $331 per month. Let's instead assume I keep the Pilot, and invest the $331/month for five years at 2.5% high yield savings account.
At the end of the 5 years, I have roughly $20,900 available + the $3,000 for the sale of the Pilot for a total of $23,900 to use on another vehicles. At that point, I'd guess I'd be able to purchase in future dollars about the same version CRV that I can purchase today. Maybe something slightly better, but it isn't like Id be going from a CRV to a Tesla.
The other main thing, though, is that at the end of the five years of purchasing the CRV right now I still have an incredibly reliable, efficient vehicle that should last another decade. Plus I've received 5 years of low maintenance ownership while not having to worry about breaking down while going about our daily lives.