Author Topic: Should I give my camry to my brother and buy my moms volkswagon?  (Read 6012 times)

humbleMouse

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Should I give my camry to my brother and buy my moms volkswagon?
« on: December 14, 2015, 10:49:58 AM »
My brother is turning 18 soon and his car is a total piece of crap that is becoming dangerous to drive.  I currently drive a 99 camry that runs like brand new and has been meticulously maintained.

My mother is offering to sell me her 2007 4dr VW rabbit 2.5L for $2500.  The car has 100k miles on it and has been maintained by the dealership it's whole life and drives like new.  It has traction control, better speakers, heated seats, all things I value in a car for driving in minnesota.  I am also a music producer and test mixes in my car constantly.  The VW has way better speakers and would be much better suited to that than my current camry. 

I also am personally connected with 2 mom/pop vw shops in town because I used to drive a passat 1.8t.  So I have reliable maintenance people to maintain the VW.

My 99 LE camry - 160k miles.  Basically I would be giving this to my brother as a gift so he has a reliable good car to have when he is 18. 

My thoughts are this - if I give my brother my car and buy the VW from my mom I am basically coming out even because my car is worth 2.5-3k and the VW is worth 4-6k. 

ALSO: I don't drive much at all for 6 months of the year when I bike everywhere.  I will be putting barely any miles on the VW 6 months of the year. 


Financial situation:

Assets:
Stable contracting programming job where I make good money. 
5k in high quality music recording equipment.
9k in stocks that I actively manage.

Debts:
11k student debt @4.7% interest. 

THIS IS WHAT I AM THINKING:

I can take a loan from my friend who has lots of cash for a 2% interest rate.  We have a good history of me taking cash loans from him and paying him back very quickly.  I would not hold this VW car debt for longer than 4 months. 

Then my plan is to drive the VW until around 130-140k miles and sell it (has 100k right now).  This should net me 2.5-4k which I can then use to get a different car in the future. 


Any thoughts or questions about my plan?







vivophoenix

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Re: Should I give my camry to my brother and buy my moms volkswagon?
« Reply #1 on: December 14, 2015, 11:12:43 AM »
if you don't have the money to buy the car for $2500, you shouldn't be GIVING AWAY a working car, to buy a working car.

if you plan to barely drive, why not share the car  you currently own with your brother now and then maybe build up a fund for a different car if you want to

why do you have $$ in actively managed stocks?  do you mean an index fund? do you mean in a retirement account?

 i am not even sure if you should be listing your high quality music recording equipment as an asset. does it help you make money?

you have:
9K in stocks( not sure if retirement or what)
11k in debt

and  you want to know if you should borrow 2.5k to give away.  so this statement: "My thoughts are this - if I give my brother my car and buy the VW from my mom I am basically coming out even because my car is worth 2.5-3k and the VW is worth 4-6k.", isnt true, cause you would now have a loan, yes a low interest one. but a loan
« Last Edit: December 14, 2015, 11:15:33 AM by vivophoenix »

backyardfeast

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Re: Should I give my camry to my brother and buy my moms volkswagon?
« Reply #2 on: December 14, 2015, 11:14:12 AM »
This is a tricky one; I was in a similar spot recently.  My sister and family, who are a bit precarious financially, were embarking on a move out of the city to a suburban area with very few non-car options.  I was considering replacing my 2002 Civic, as it was coming up on 300K, even though it had lots of life yet.  I realized that I was in a position where I *could* gift it to her.

In the end, I did, and it made a massive difference to their family that I feel really good about.  Although the car wasn't worth much in cash, it has been priceless for them.  On the other hand, I did get cranky about having to spend new money on a replacement sort of unnecessarily.  If they hadn't been in the picture, I would likely have driven my old car for a couple more years trouble free, and financially that would have been nice.

Family is important, imho, and I have no regrets about sacrificing a little financially because I could do so responsibly.  If that sounds like the right thing to do in your position, go for it. 

I know sometimes it's hard to quiet that voice that says "all spending that's not on NEEDS is hedonistic lifestyle inflation for fools!!"  But truthfully, you're not talking about a lot of money for something that sounds like a win-win for everyone involved.  If you're going to spend $2500 on a new car, that money's better off staying in the family anyway, right? :)

norabird

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Re: Should I give my camry to my brother and buy my moms volkswagon?
« Reply #3 on: December 14, 2015, 11:18:34 AM »
I would keep driving your camry. Your mom could give your brother the car if she felt he needed it.

OneCoolCat

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Re: Should I give my camry to my brother and buy my moms volkswagon?
« Reply #4 on: December 14, 2015, 11:19:11 AM »
I would do it.  I gave my 2000 Honda civic to my little sister and bought my brothers car (0% interest) and have no regrets.  I didnt enough to buy the car from my brother but he gave men  good deal and I gave my old car to my sister in return.  I have no regrets about it.

I would probably sell those stocks to pay for your moms car though.

use2betrix

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Re: Should I give my camry to my brother and buy my moms volkswagon?
« Reply #5 on: December 14, 2015, 11:20:15 AM »
I would keep driving your camry. Your mom could give your brother the car if she felt he needed it.

I agree with this. Keep the Camry for now.

I also have a 99 Camry but mine has around 105k miles. It's a great car! Taking it on a 3000 mile round trip later this month. It's my mustachian vehicle. Also at 160k yours is barely broke in. It will honestly probably run longer and be cheaper than that VW. Look up edmunds reviews on the 99 Camry, they're unreal with all the high mileage reviews.

Jakejake

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Re: Should I give my camry to my brother and buy my moms volkswagon?
« Reply #6 on: December 14, 2015, 11:22:32 AM »
What does your brother need a car for, at 18?

use2betrix

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Re: Should I give my camry to my brother and buy my moms volkswagon?
« Reply #7 on: December 14, 2015, 11:28:30 AM »
What does your brother need a car for, at 18?

Not everyone has safe biking routes to/from school/work. Many people also live in smaller towns with no public transportation.

madamwitty

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Re: Should I give my camry to my brother and buy my moms volkswagon?
« Reply #8 on: December 14, 2015, 11:39:56 AM »
If you're going to spend $2500 on a new car, that money's better off staying in the family anyway, right? :)

Except the proposed plan of action has interest going outside the family.

Maybe Mom can accept payment over the 4-month period? Cut out the middleman.

humbleMouse

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Re: Should I give my camry to my brother and buy my moms volkswagon?
« Reply #9 on: December 14, 2015, 11:41:03 AM »
Thanks for all the replies.  Couple of things I have to say.

I understand that 99 camrys are the most reliable cheapest cars out there, thats why I bought it in the first place (for $1k from a friend with 146k miles). 

I live in minneapolis minnesota, and while it is possible to get by without a car in certain lifestyle situations here, anybody who knows the midwest knows that not having a car really really really sucks.

The camry kept maintained will last my brother well into his 20's.  I feel like it would help him out/give him more job/life opportunities and whatnot as he figures out what he wants to do. 

I have a hellacious 12 mile commute in terrible weather all winter and sometimes I feel like my camry is going to go off the road.  All the windows get fogged up, hard to see, etc, etc. 

I bike to work half the year so again, not many miles would be getting put on the VW compared to lots of other people's driving habits.  This would increase longevity. 

Lastly, the loan from my friend would be paid off within 4 months (I save 50% of my income) and then I would own the car outright.  My friend would likely object to charging me interest(like he has in the past).  Then me, my mom, and my brother can all drive reliable cars that fit our needs. 

let me know if there are any other details to this story anybody would like.



vivophoenix

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Re: Should I give my camry to my brother and buy my moms volkswagon?
« Reply #10 on: December 14, 2015, 11:46:38 AM »
Thanks for all the replies.  Couple of things I have to say.

I understand that 99 camrys are the most reliable cheapest cars out there, thats why I bought it in the first place (for $1k from a friend with 146k miles). 

I live in minneapolis minnesota, and while it is possible to get by without a car in certain lifestyle situations here, anybody who knows the midwest knows that not having a car really really really sucks.

The camry kept maintained will last my brother well into his 20's.  I feel like it would help him out/give him more job/life opportunities and whatnot as he figures out what he wants to do. 

I have a hellacious 12 mile commute in terrible weather all winter and sometimes I feel like my camry is going to go off the road.  All the windows get fogged up, hard to see, etc, etc. 

I bike to work half the year so again, not many miles would be getting put on the VW compared to lots of other people's driving habits.  This would increase longevity. 

Lastly, the loan from my friend would be paid off within 4 months (I save 50% of my income) and then I would own the car outright.  My friend would likely object to charging me interest(like he has in the past).  Then me, my mom, and my brother can all drive reliable cars that fit our needs. 

let me know if there are any other details to this story anybody would like.

i guess i am confused, you came to blog about early retirement.
but it sounds like want advice that is based on emotion.

it sounds like you already know what you want to do, but want 'permission' to do it.

do you want to give away your car and take on a loan for your brother?
does it matter what other people  add?

humbleMouse

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Re: Should I give my camry to my brother and buy my moms volkswagon?
« Reply #11 on: December 14, 2015, 11:50:32 AM »
Thanks for all the replies.  Couple of things I have to say.

I understand that 99 camrys are the most reliable cheapest cars out there, thats why I bought it in the first place (for $1k from a friend with 146k miles). 

I live in minneapolis minnesota, and while it is possible to get by without a car in certain lifestyle situations here, anybody who knows the midwest knows that not having a car really really really sucks.

The camry kept maintained will last my brother well into his 20's.  I feel like it would help him out/give him more job/life opportunities and whatnot as he figures out what he wants to do. 

I have a hellacious 12 mile commute in terrible weather all winter and sometimes I feel like my camry is going to go off the road.  All the windows get fogged up, hard to see, etc, etc. 

I bike to work half the year so again, not many miles would be getting put on the VW compared to lots of other people's driving habits.  This would increase longevity. 

Lastly, the loan from my friend would be paid off within 4 months (I save 50% of my income) and then I would own the car outright.  My friend would likely object to charging me interest(like he has in the past).  Then me, my mom, and my brother can all drive reliable cars that fit our needs. 

let me know if there are any other details to this story anybody would like.

i guess i am confused, you came to blog about early retirement.
but it sounds like want advice that is based on emotion.

it sounds like you already know what you want to do, but want 'permission' to do it.

do you want to give away your car and take on a loan for your brother?
does it matter what other people  add?



Yeah I am going to get the car from my mom.  Guess I am just posting because I am bored at work and I know from other people's perspectives I like hearing about their financial turmoils and decision making strategies.  This is an ER forum, but it is also a lifestyle and finding your values forum.  I want my brother to have a good reliable car - something I didn't have when I was his age. 

backyardfeast

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Re: Should I give my camry to my brother and buy my moms volkswagon?
« Reply #12 on: December 14, 2015, 01:22:05 PM »
I would just echo the "pay your mother for the car over installments" option.  It sounds like your friend is a fine option, but would your mother also be fine with the 4 months of payments?  Especially as your car is going to her other son?

Jakejake

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Re: Should I give my camry to my brother and buy my moms volkswagon?
« Reply #13 on: December 14, 2015, 01:33:42 PM »
The camry kept maintained will last my brother well into his 20's.  I feel like it would help him out/give him more job/life opportunities and whatnot as he figures out what he wants to do. 
Giving it to him as a gift may do as much harm as good long term. Sometimes giving high value gifts teaches the wrong lessons to teens. If he needs a car to get to work, he should be paying at least a portion of that cost to teach the value of money. If it's purely for recreation, I wouldn't fund it at all. The Millionaire Next Door has a good bit of writing/statistics about what happens when family members subsidize the living expenses of adult children - you might want to at least get that from the library and read/listen to it before making a final decision.

humbleMouse

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Re: Should I give my camry to my brother and buy my moms volkswagon?
« Reply #14 on: December 14, 2015, 01:42:32 PM »
The camry kept maintained will last my brother well into his 20's.  I feel like it would help him out/give him more job/life opportunities and whatnot as he figures out what he wants to do. 
Giving it to him as a gift may do as much harm as good long term. Sometimes giving high value gifts teaches the wrong lessons to teens. If he needs a car to get to work, he should be paying at least a portion of that cost to teach the value of money. If it's purely for recreation, I wouldn't fund it at all. The Millionaire Next Door has a good bit of writing/statistics about what happens when family members subsidize the living expenses of adult children - you might want to at least get that from the library and read/listen to it before making a final decision.

This is a good point and something I have been thinking about.  My mother has expressed that she does not want my brother to be in debt to me (I suggested 100/month payments for a year).  My brother doesn't have a job right now because he is struggling to graduate high school.  So perhaps I could work something out where he starts paying me $100/month for a year when he gets a job again. 

Villanelle

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Re: Should I give my camry to my brother and buy my moms volkswagon?
« Reply #15 on: December 14, 2015, 02:10:34 PM »
If I didn't have $2500, no way in hell would I be considering borrowing money to upgrade my car.  Nope.   Even if you can pay off the loan to your friend in a short time, the fact that you have to borrow it at all means you don't have sufficient savings.  So you haven't yet earned a new car.  Nor, for that matter, has your brother. 

lizzzi

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Re: Should I give my camry to my brother and buy my moms volkswagon?
« Reply #16 on: December 14, 2015, 02:41:52 PM »
+1  The OP gives a rather complex rationalization of why she should borrow money to buy a car, when she already has one. If she has to borrow the $2,500, she can't afford it. Also, I don't see why she should give her car to her brother. If he wants to get a car, he needs to figure it out for himself.

lizzzi

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Re: Should I give my camry to my brother and buy my moms volkswagon?
« Reply #17 on: December 14, 2015, 02:42:52 PM »
Forgot to say that I have three younger brothers.

frugaliknowit

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Re: Should I give my camry to my brother and buy my moms volkswagon?
« Reply #18 on: December 14, 2015, 02:55:03 PM »
No.  It is not appropriate for you to give your car away when you would require a loan for a replacement.

therethere

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Re: Should I give my camry to my brother and buy my moms volkswagon?
« Reply #19 on: December 14, 2015, 03:29:07 PM »
Your brother does not work and is barely getting by in high school. Why does he need a car again? It sounds like it would be more of a distraction. Are you sure you just aren't using a made up "need" to give you warm and fuzzy feelings allowing you to upgrade your car?

Also, you say the Camry can last for a long time if well maintained. Do you really think your brother will actually maintain it? Let's be honest he's 18. I barely even took my car for oil changes at 18. Paying anything for scheduled maintenance will most likely not happen.

mizchief

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Re: Should I give my camry to my brother and buy my moms volkswagon?
« Reply #20 on: December 14, 2015, 04:34:00 PM »
Who is paying the insurance on your brother's car?  That's a big expense.   Particularly if/when he stops being a student.

He may be better off without a car until he can afford one.

Jakejake

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Re: Should I give my camry to my brother and buy my moms volkswagon?
« Reply #21 on: December 14, 2015, 04:45:27 PM »
The more details I see, the more I think this is a lose-lose situation for both of you. You end up in debt for a car, when you already have one that works.

Your brother's main job right now is to finish high school. Getting a job right now seems like a very bad idea if he's struggling with that - a job makes it harder, not easier, to get homework done and get enough sleep. If someone else pays for the car and insurance, that's enabling him and starting an adult cycle of financial dependency. If they don't, he's got more pressure to get a job to pay for the car and gas and insurance.

If he doesn't get a job, is given the car just for fun, and then starts to pay it back only after he graduates and gets a job, then he's starting his adult life already in debt for fun he had while in high school (a horrible reason to acquire debt!). Plus if he can't or won't pay it back, it will likely damage the relationship between the two of you as you start to feel more and more judgmental about how he does spend his money, if he is in debt to you.

Rural

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Re: Should I give my camry to my brother and buy my moms volkswagon?
« Reply #22 on: December 14, 2015, 06:23:24 PM »
 Your math doesn't add up, either. You don't "come out about even" you lose the value of your current car, plus you lose the $2500, plus you lose whatever interest you end up paying on the $2500. Not to mention that you'll probably end up with less reliable vehicle in the long term.

purple monkey

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Re: Should I give my camry to my brother and buy my moms volkswagon?
« Reply #23 on: December 15, 2015, 08:10:00 AM »
I think that you have to do what you think is best.
Would this have helped you at that age?
Would it have hindered you?
Would you have wanted your older sibling to do it for you?

Good luck.

humbleMouse

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Re: Should I give my camry to my brother and buy my moms volkswagon?
« Reply #24 on: December 15, 2015, 04:34:04 PM »
Thanks again for everybodys input.  I think the right thing to do here is just wait because i am saving money at a good rate.  By the time next winter rolls around I could buy a car with better traction control with cash.  I want to help my brother but I will help him more in the longer run by being financially stable and able to help other ways in the future. 

paddedhat

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Re: Should I give my camry to my brother and buy my moms volkswagon?
« Reply #25 on: December 16, 2015, 05:45:56 PM »
Even if your mom has had wonderful luck with the VW, it still is what it is, and not something that is guaranteed to be reliable for much longer. Things can get real ugly and expensive with any modern VW, and dropping much more than you paid, to address common flaws in what is essentially an over engineered and underbuilt vehicle, would be far from unusual. Personally, as a former owner of one of their mid-2000 shit boxes, I would only end up with one if it was too cheap to pass up on, and I was planning on flipping it ASAP.