Author Topic: Should I sell my car?  (Read 3350 times)


  • Handlebar Stache
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Should I sell my car?
« on: May 20, 2014, 02:46:38 PM »
Let's start with the face punch: I bought a new car from a dealership last year, with a 60 month loan.

The better aspects of the situation are that we're a single car household and the interest rate is 0.9%.

If only I had found MMM earlier, I would have bought an older Fit with cash. From where I am, though, it may make more sense to keep the current car than to replace it.

Is it reasonable to pay more over 10 years to have a vehicle that's 3-6 years  newer at that point? Are there any costs or benefits on either side that I'm missing? (Besides the time value of money; I gave up on that math because all the costs are incurred at different times.)
« Last Edit: August 19, 2016, 12:20:00 PM by merula »


  • Pencil Stache
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Re: Should I sell my car?
« Reply #1 on: May 20, 2014, 06:05:55 PM »
I'd sell it and get an older Fit (or better yet, a 2006+ Civic). I expect you'll end up saving more than 4.2k, and I don't recommend holding on to a car loan a second longer than you have to.


  • Magnum Stache
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Re: Should I sell my car?
« Reply #2 on: May 20, 2014, 06:26:35 PM »
The math does not lie. You may also consider buying an even older, lower cost car if you can find the right deal.

Depending on your state, you may also need to include sales tax in your used car purchase, which won't change your math very much.

Once you add in the cost of gas over that decade (probably 5,000 gallons for 150k of driving at 30 mpg) yo end up saving about 10% or so by making the change. You can use the money you saved to buy a bike, drive less and save even more as gas will be about half the cost of ownership over that decade.


  • Pencil Stache
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Re: Should I sell my car?
« Reply #3 on: May 20, 2014, 09:08:24 PM »
One problem with buying and selling is taxes.  What is your tax rate for buying a car? 

Also look at tire wear.  Selling a car with new tires and buying a used one with worn out tires is a $500 difference that isn't necessarily shown in the KBB value.

If it were me I would also assign some kind of risk value to the fact that I'm buying a used car and could potentially get stuck with a car with serious problems.  How do you mitigate that?  Take it to a trusted mechanic and pay him to look it over.


  • Pencil Stache
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Re: Should I sell my car?
« Reply #4 on: May 20, 2014, 09:17:54 PM »
Instead of face punching yourself, here are a few other options:

1) Think of this site and forum as a place where you can learn incrementally, over time...and do 'things' better -- whatever that means -- the next time out.

2) Consider how many miles you drive per year. Let's say you put 10K per year on that new Fit. You could easily keep the car for AT LEAST 16 years...more than your 10 year calculation for costs.

3) Can you accelerate the payoff of the loan, chopping a year or two off?

I don't have the precise #s to back up my perspective here, but I just wonder if you're already locking in depreciation and should instead drive your new car and maintain it beautifully... until it is dust.


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