Hey all, My wife and I are about to hit 1 year and have realized our financial decisions must be priority, starting now. We've got approx $50k in debt, mix of consumer, credit, and student loans. My wife's car broke about 18 months ago and before our frugal minds were around, we bought a new, 2013 Kia sportage, and we owe just about $1k less than it blue books for right now.
Here's the deal:
My wife just started a new job and has an option for vehicular/transportation expenses:
Option 1) She can keep the 2013 Kia Sportage we have now, and be re-imbursed a flat-rate $0.45/mi for work travel (does not include to/from office). We would continue to pay our monthly car payment ($506), monthly insurance ($94), and maintenance (say $50 monthly budgeted), totalling $650 monthly. (not to mention, wiping $18k in debt)
or
Option 2) They will provide a new 2015 SUV, pay all fuel, maintenance, repair, and insurance, but she will be required to pay $65/week to use the car, that would be decked out with company logos, etc etc. and we would have to use it sparingly on the weekends.
If we take the saved money in #1, and subtract the monthly "lease" of #2, we've basically freed up $330 monthly that we can put towards paying down our high interest debts. I know it's basically "leasing" a car, and many hold strong opinions about why that's bad, but in this case, doesn't it make more sense to take the 2nd option? We haven't quite made up our minds yet, but leaning closely to taking the company car, and handing the Kia back to the dealership. She's very happy, safe and secure in her new job, surrounded by a great company and staff (many are friends), and (while I realize no one can predict the future), there's no reason to think she'd lose her job, or lose the car anytime in the near future. And if she did, we just go out and get a cheaper SUV for her until we re-settle.
Does anyone have any information, criticism, feedback on WHY this is a bad idea?
Sorry for the length, I hope it's easy to understand, and thanks in advance for any feedback/suggestions.