Author Topic: Young friend NEW car  (Read 7653 times)

Exflyboy

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Young friend NEW car
« on: September 15, 2014, 12:43:50 PM »
Posted all over Facebook.. Just left college and has bought a BRAND NEW VW TDI... refers to this thing as "her baby".

Now I don't honestly know what her financial position is.. student loans, housing costs etc etc.

I would bet dollars to donuts its financed.. But hey its a diesel so think of the gas mileage.. Interest payments??

Slowly banging my head on the edge of the desk!

Frank

ketchup

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Re: Young friend NEW car
« Reply #1 on: September 15, 2014, 12:59:35 PM »
It hurts when I see this.  My car is about 5% of my (admittedly small, but I'm 23) net worth, and I see plenty of people who's cars are 100% of their negative net worth.  It's depressing.

Jags4186

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Re: Young friend NEW car
« Reply #2 on: September 15, 2014, 05:36:46 PM »
Posted all over Facebook.. Just left college and has bought a BRAND NEW VW TDI... refers to this thing as "her baby".

Now I don't honestly know what her financial position is.. student loans, housing costs etc etc.

I would bet dollars to donuts its financed.. But hey its a diesel so think of the gas mileage.. Interest payments??

Slowly banging my head on the edge of the desk!

Frank

VW does have 0% financing right now so perhaps she's investing the money she would have spent on the car in the market!

dragoncar

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Re: Young friend NEW car
« Reply #3 on: September 15, 2014, 05:58:41 PM »
I made this mistake when I graduated too.  Of course, I still have my  baby,  over a decade later.  Doesn't have to be terrible.0

MrsPete

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Re: Young friend NEW car
« Reply #4 on: September 16, 2014, 06:06:53 AM »
I made this mistake when I graduated too.  Of course, I still have my  baby,  over a decade later.  Doesn't have to be terrible.0
Doesn't have to be, true.  But most people won't follow your path. 

I am also driving a car that was purchased new -- had, I think, seven miles on it when I drove it off the lot.  It was a carefully researched choice, and given the same circumstances I'd make the same choice again.  The price difference between late-model used and new was less than $1000 -- I think that's a little unusual, but it was true when I made the purchase. 

Mine's only eight years old now, but I expect it will last me something like another eight. 
« Last Edit: September 16, 2014, 06:18:05 AM by MrsPete »

schimt

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Re: Young friend NEW car
« Reply #5 on: September 16, 2014, 07:15:57 AM »
Not that i'm agreeing with buying a new car, i have a 99' corolla that i pickup up 2 years ago with only 40,000 miles on it. But diesels do hold their value very well, even with high miles. So if your friend changes her mind at some point, she should be able to unload the car at a much better price then a regular gas vehicle. Also if she does keep it, it should last her a very long time.

GuitarStv

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Re: Young friend NEW car
« Reply #6 on: September 16, 2014, 08:26:12 AM »
I'm not convinced that it's always better to buy used.

We bought our corolla new in '05.  It wasn't extravagantly expensive, and I hope to keep it running for another ten years at least.  :P

slugline

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Re: Young friend NEW car
« Reply #7 on: September 16, 2014, 09:54:34 AM »
I'll admit that I "rewarded myself" with a new car after landing a new job. But it was paid off in about a year and that Honda is still my daily driver 14 years later, so I think the financial damage can be mitigated. Don't hurt yourself too much on that desk. :)

Cinder

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Re: Young friend NEW car
« Reply #8 on: September 16, 2014, 10:00:18 AM »
I got a brand new Prius in 2008 after graduating and getting a job as a software engineer, but that is because I had my 'hobby' of driving 4 hours each way every weekend to volunteer on a tall ship, and my Jeep Wrangler was a little hard on gas ;).  I should go back and take all my credit card records and put them in a spreadsheet and see how much money I was wasting all the time, though my time on the ship was amazing and don't regret it. 

I've since used the prius almost as a truck to haul all kinds of things... firewood, furniture (corner cabinet fit in the back!), tile to redo our shower, etc...

I think I got it for around 22k, paid cash (Being what I thought was a natural saver I had just been letting cash pile up in my money market account). 

strider3700

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Re: Young friend NEW car
« Reply #9 on: September 17, 2014, 10:48:50 AM »
I just bought a new car.   Paid cash.   The used market here was weird.   Things were very worn out and over a decade old(most were 15 + years old)  or only a year or two old on a dealers lot and priced just slightly below new.   The dealers were not negotiating at all on the used.  One insisted their best price on a used Toyota was  the sticker price plus tax. The equivalent brand new was only 15% more then the used one at the dealer.    I ended up going to a different dealer and buying what I wanted new.      The way I see it is I have a stache for a reason and one of those reasons is being able to just spend money to make issues go away if I want.      The purchase price was not a major dent to the stache. 

Elderwood17

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Re: Young friend NEW car
« Reply #10 on: September 17, 2014, 11:36:35 AM »
Buying a new car, maintai ING it well and running it into the ground over a long nu,ber of years isn't the worst thing one can do.  However, that is rarely the case and when one comes right out of school if you can live like you are still a poor student you can fertilize that stache so it grows nice and big!

makincaid

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Re: Young friend NEW car
« Reply #11 on: September 17, 2014, 12:12:55 PM »
I did the exact same thing, bought a brand new diesel jetta when I started my first full-time job (financed, no less0. Not my brightest moment, but I'm still driving it 13 years later.

Timmmy

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Re: Young friend NEW car
« Reply #12 on: September 17, 2014, 12:13:13 PM »
Posted all over Facebook.. Just left college and has bought a BRAND NEW VW TDI... refers to this thing as "her baby".

Now I don't honestly know what her financial position is.. student loans, housing costs etc etc.

I would bet dollars to donuts its financed.. But hey its a diesel so think of the gas mileage.. Interest payments??

Slowly banging my head on the edge of the desk!

Frank

What exactly is the "gas" mileage on a TDI?

TreeTired

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Re: Young friend NEW car
« Reply #13 on: September 17, 2014, 12:31:08 PM »
Very often a new car is purchased along with a new job,  especially if the car is needed to commute to the new job.   What could be worse than starting a new job and then needing to spend time (either before/after work,  or worse - taking time off form a new job)  on car repairs?  New cars can need repairs,  new cars can get recalled, but I think on average there will be less worry and less need for immediate repairs on a new car than a used car. 

I have purchased new, and I have purchased used... (very used) and when  the used car worked out, needed minimal repairs, lasted a few years and produced a nice tax deduction after donation, I attributed my good luck to... luck. 

Beric01

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Re: Young friend NEW car
« Reply #14 on: September 17, 2014, 12:37:12 PM »
I was fairly close to doing this (was starting researching what kind of car I needed) - thank goodness I discovered Mustachianism and started biking everywhere instead! Also that my parents gave me their 15-year-old Oldsmobile so I didn't need to make a car purchase immediately upon graduating.

coffeehound

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Re: Young friend NEW car
« Reply #15 on: September 17, 2014, 04:46:24 PM »
Posted all over Facebook.. Just left college and has bought a BRAND NEW VW TDI... refers to this thing as "her baby".

Now I don't honestly know what her financial position is.. student loans, housing costs etc etc.

I would bet dollars to donuts its financed.. But hey its a diesel so think of the gas mileage.. Interest payments??

Slowly banging my head on the edge of the desk!

Frank

What exactly is the "gas" mileage on a TDI?

I confess - I bought a brand-new Golf TDI last year, because I have a clown-like commute, and need to stay for another 10 months to vest in the pension....  I get slightly over 39 mpg, combined LA freeway/surface streets.

I bought it for the fuel economy - estimated mileage is 42 highway.  I can go 520 miles on a tank - much farther than I could in my Corolla.  Only regrets, so far, are the automatic transmission (LA traffic stops, a LOT), and the cost to insure.
« Last Edit: September 17, 2014, 04:50:04 PM by coffeehound »

jmusic

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Re: Young friend NEW car
« Reply #16 on: September 19, 2014, 12:19:55 PM »
For all the folks that are say "used cars are barely cheaper than new," it's because they only shop AT A CAR DEALER.  Dealers price their used cars high because they would rather sell you a new car!

The way to save money is by buying from a PERSON instead (after doing due diligence).


ketchup

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Re: Young friend NEW car
« Reply #17 on: September 19, 2014, 03:12:08 PM »
For all the folks that are say "used cars are barely cheaper than new," it's because they only shop AT A CAR DEALER.  Dealers price their used cars high because they would rather sell you a new car!

The way to save money is by buying from a PERSON instead (after doing due diligence).
This.  For a real comparison, I just looked it up and a new 2014 Camry starts at $22.4k according to toyota.com, and on my local Craigslist I found many 2012-2013 models for $15k-18k.  $7k off current MSRP for a two year old car with 35k miles is not insignificant.  And I'm sure it's plenty more dramatic on cars that depreciate faster than a Toyota.

Of course, I'd be the guy getting a 1998 Camry for $2k instead, but that's neither here nor there. :)

NathanP

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Re: Young friend NEW car
« Reply #18 on: September 24, 2014, 08:05:49 AM »
For all the folks that are say "used cars are barely cheaper than new," it's because they only shop AT A CAR DEALER.  Dealers price their used cars high because they would rather sell you a new car!

The way to save money is by buying from a PERSON instead (after doing due diligence).
This.  For a real comparison, I just looked it up and a new 2014 Camry starts at $22.4k according to toyota.com, and on my local Craigslist I found many 2012-2013 models for $15k-18k.  $7k off current MSRP for a two year old car with 35k miles is not insignificant.  And I'm sure it's plenty more dramatic on cars that depreciate faster than a Toyota.

Of course, I'd be the guy getting a 1998 Camry for $2k instead, but that's neither here nor there. :)


Not to troll, but I used my credit union's TRUECar link and found that a new, base model Camry can be had for $17,214. Many times these commodity cars can be had for large discounts. In this case, I would buy the new car so that I could get super cheap financing and to ensure that the maintenance schedule was followed to maximize my chance of having a trouble free car for 15+ years.


ketchup

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Re: Young friend NEW car
« Reply #19 on: September 24, 2014, 08:45:32 AM »
For all the folks that are say "used cars are barely cheaper than new," it's because they only shop AT A CAR DEALER.  Dealers price their used cars high because they would rather sell you a new car!

The way to save money is by buying from a PERSON instead (after doing due diligence).
This.  For a real comparison, I just looked it up and a new 2014 Camry starts at $22.4k according to toyota.com, and on my local Craigslist I found many 2012-2013 models for $15k-18k.  $7k off current MSRP for a two year old car with 35k miles is not insignificant.  And I'm sure it's plenty more dramatic on cars that depreciate faster than a Toyota.

Of course, I'd be the guy getting a 1998 Camry for $2k instead, but that's neither here nor there. :)


Not to troll, but I used my credit union's TRUECar link and found that a new, base model Camry can be had for $17,214. Many times these commodity cars can be had for large discounts. In this case, I would buy the new car so that I could get super cheap financing and to ensure that the maintenance schedule was followed to maximize my chance of having a trouble free car for 15+ years.
Damn, well there you go.  Most people certainly don't look into options like that, but if you do, it looks like that can bring you out ahead (of a 35k two-year-old car) depending on the car.

dcheesi

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Re: Young friend NEW car
« Reply #20 on: September 24, 2014, 09:13:19 AM »
A year out of college, I was still driving a 16yo beige Oldsmobile, with a cracked "bronze" vinyl top that looked remarkably like pure rust from ten feet away. It still ran, but was definitely on its last legs (thanks in part to my clueless and lax maintenance habits at the time).

At my review, I was given a big raise. My bosses made it sound like they gave me the large pay bump specifically so I could buy a new car?! Note that this was not a sales job, so it's not like I actually needed it to look good; apparently, they just didn't want to look at my crappy car in the parking lot anymore.

Being young and foolish, I wound up buying a brand new econo-box with the high-end "sport" package (/facepalm). The sad part is that I was within walking distance of work, so aside from visiting my parents once a month, I didn't really need a car at all!

Mrs. J

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Re: Young friend NEW car
« Reply #21 on: September 24, 2014, 11:45:05 AM »
My aunt, who is pretty frugal, bought a brand new VW TDI about 10 or 12 years ago. That car has over 300,000 miles on it now (she has to drive all over her state for her job). It seems like a great car, and a pretty practical choice for someone right out of college. Maybe your FB friend plans to drive it into the ground (one can hope).

Forcus

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Re: Young friend NEW car
« Reply #22 on: October 09, 2014, 11:31:27 AM »
The way to save money is by buying from a PERSON instead (after doing due diligence).

I think this is maybe a geographic thing.

Here in IL cars have a finite life. It is common to see cars 3-4 years old with major rust (rust coming through panels from behind.... NOT rust from scratches that weren't repaired). It is hard to find a 10 year old truck that does not need rockers, wheelwells, etc. Those trucks tend to migrate to the farm, get beat up, and put down because everything is worn out. Cars get given to high school kids who turn around and crash them, etc. So, less supply.

In addition, because of the particular industries and sub-industries in my area there is a fair amount of disposable income, even in the labor areas. The high income guys buy new, sell off their stuff to the middle income guys, and some of it trickles down to the lower income guys (some... see paragraph above).

Therefore supply is lower than other areas and demand higher than other areas. Perfect storm for high prices - NOT just at the dealer. It is very hard to find good deals around here, the only time you see major deals are with rebuilt title cars, or someone who just doesn't know any better.

You can get a new Subaru Imprezza, which has AWD, AC, PW, PL, etc. and I think even alloy wheels standard, for around $17.2. You can get Mitsubish Outlander Sports for around $17k because they build them right here and the Mitsu dealers like to move a lot of product. In any case, at one point I was cross shopping these and used versions of each of these were MORE expensive than new. Dealer or not.

Just a little counterpoint. I am happy with my cheap paid for stuff for now, but I really want a 50 MPG 3 cylinder Fiesta when they get cheap enough. But the few used ones are almost as much as new and were probably magazine test cars. The ones they beat on..

EDIT: I'd be more concerned about the OP's friend if it were like a 40k BMW or something. But I give the benefit of the doubt to anyone who purposely buys a TDI. Plus at least in my experience it is extremely hard to find a used one that doesn't have 250k miles on it.
« Last Edit: October 09, 2014, 11:33:36 AM by Forcus »