In our quest to become more mustachian, my wife and I are considering selling one of our cars. But we're not sure if it's the right move.
We purchased a brand new Subaru Forester a year ago at $25k. We put down 10k, and our balance right now is 12k. We have 0% interest, so that's definitely a plus. We also have the peace of mind in knowing that we have a rock solid vehicle for the next 10 years and one that's safe for our 6 month old boy.
But we also have some student loan we'd like to knock out, not to mention the 12k we owe on the vehicle itself. Even though the interest rate is 0% we still have $240/month of cash flow we're losing.
Our idea is to sell the Forester (blue book has it at $22.5k in a private sale), recoup our 10k down payment, and use that to but a 10k used vehicle outright.
Is this a viable strategy? I'm going to guess that it's the mustachian thing to do, but are we taking on significant risk with a 10k station wagon, while we have a 6 month old kid? Just looking for some thoughts.