Hi, longtime reader, now starting to make some changes in my own life, and I'd love some feedback. :) Story below.
So I graduated from college in 2014 and was able to get a job in the software industry. To make a long story short I found myself in pretty immediate want of a car, I was living with my parents and my new job was a commute away. I had very little saved up (a couple grand) and didn't feel confident I'd be able to score a safe and reliable vehicle in the used car market with it (wrong, although, having $4-5k more kicking around would have really helped.) So instead of spending all of my money on a car, I did the unthinkable and spent
more than all of my money on a car.
I'm proud that at least the bad decision I made was pretty smart; with some help from a friend, I scored a brand new 2015 Honda Fit LX for about $16k financed. The payments ended up being about $252/mo.
That was no problem while I was living with my parents and I was easily able to sock away 50% of my income or more while paying down the car. To make another long story short, I had to move out.
Now I'm paying kind of a lot in rent, still commuting (but not as far) and still paying down the car. I'm feeling the various invisible costs that come with it; the depreciation, the insurance, the surprisingly expensive maintenance. I'm breaking even but having a hard time putting away anything new in savings.
Rereading through the MMM archives, I got inspired. I now have about $10k saved up in cash and various investments. I'm considering my options.
1) Plug along steadily until it's paid off.
2) Pay it off ASAP. There's about $8100 left on the car. I could empty my savings and pay it off pretty quickly, and become the sole owner of my 2015 Honda Fit.
3) Sell the thing and buy a reasonable car.
I'm leaning toward #3. The novelty of driving a 2015 wore off pretty quickly, I don't like the way this model Fit performs in certain ways, and I want to get out of debt like right now (I also have some student loan debt).
I'm also leaning towards buying a
sweet used Honda Accord I found, or something similar. It's a 2000 model car with 22,000 miles on it, somehow. Sounds like a car that can last me another 10 years; but note it's actually less efficient than the Fit. Much less, to the tune of $4000/10 years (Must find an I4!)
I'm not sure exactly how this 10 year math works out. But my intuition is that the Fit will cost me more over 10 years than almost any 2000-era used car with 60k miles or less. Is this a good move?