Sister-in-law thinking of buying new Jeep - how to dissuade?

[senorpanqueque]

The wife was speaking to her sister (23 years old) on the phone last night, and learned that she is thinking of buying a new Jeep as her used car is getting to be in pretty bad condition. The cost for a Jeep is apparently around $22000 because it includes no bells and whistles. She explains that she might as well do that rather than get a 2010 or whatever because apparently a whistles-on Jeep from that era costs about the same, and a 2014 has better fuel economy and will have lower insurance costs.

She wants a Jeep because she works in construction. She was asking for advice on whether she should get a full car loan for the $22000, or get a loan for the down payment and then finance from the company.

I want her to do neither, but she is of a bit of a different mindset so I'm not sure how to go about it. Can someone show me an easy way to illustrate how much the vehicle will actually end up costing her in the long run (either by loaning the full amount, or but getting it financed?). I don't know much about car loans or financing because I just buy used for cash.

I know she somewhat understands the value of money because she works hard and works long hours, but I don't think she fully understands the impact this can have on her future.

Here's the short of it:

1. Planning to buy 2014 Jeep (22,000 according to her) either by getting a full car loan or for the down payment with financing
2. Doesn't have much money saved up right now, but is working long hours making decent money and wants to save
3. Current car is in bad condition, and won't last long (I do believe she needs a car)
4. I want to try to convince her to hold out and save up for a used truck or something similar
5. I am unfamiliar with how car loans and financing works, but want to give her advice and to illustrate the real cost of buying this vehicle.

Thanks for any advice you might have!

[Milspecstache]

Consumer reports would probably help her.  Encourage her to do some research at a library using CR.

[marblejane]

I think that in order to successfully dissuade your wife's sister from doing this, you need to present her with an alternative solution.

It sounds like, no matter what, you are going to want her to delay the purchase. First, figure out how long she can safely delay buying a car.

Second, I would see if she is open to other models. You say that she wants a Jeep because she works in construction. Which model is she looking at? Maybe another small SUV, or even a Subaru Forrester/Outback would be acceptable to her.

Once you find out these things, you can model different scenarios for her, for example, showing her the total cost to fully finance a 2014 Jeep Grand Cherokee vs. putting down $X. Or comparing the total cost of owning a Jeep Grand Cherokee vs. a Subaru Forrester. Etc. Try using the Edmunds True Cost of Ownership tool or another similar tool to compare different models. http://www.edmunds.com/tco.html

You're probably not going to stop her from buying an SUV, so focus on incremental wins, like getting her to save $1k towards the car, buying a used model, or a more efficient model.

[Hugerat]

Probably not the advice you want, but don't bother. People looking at that sort of vehicle have almost always already convinced themselves that they need it. "A smaller vehicle just wouldn't be adequate for all of the hauling I do", they'll say. "I'm a tall person, like 6'1", I need a HUGE car! If I drive a Civic how will I help my friend move every 3 years? And don't you know that it snows around here???!!"

Besides, it's not like you share finances with a sister in law. She should make her own mistakes.

[zarfus]

I just talk about my experiences.  For example (I actually bought a new care years ago..unfortunately), "I wish I hadn't bought my car new because...XYZ".  Similarly, "I know where you're getting at, however, I bought used and it was a great decision because...XYZ".  Talking like this encourages people to learn from other people's experiences.  Don't tell her what to do, she probably won't listen.  If she won't learn from your experience, she may just have to go out and learn on her own.

Understand that money isn't everything to most people.  Everyone deserves what they want, or at least that's how 98% of the people I work/live/deal with are like :/

[senorpanqueque]

Thanks for the advice, all!

I should have mentioned I'm in Canada, so a couple of those websites mentioned are better for American users.

And yes, she is my sister-in-law, so her finances do not affect mine, but I feel as though one of the roles of an older brother is to offer advice so that hopefully, she doesn't have to make those mistakes. The problem is not necessarily that she won't listen to advice, just that I need to find out ways that advice gets through to her.

[shadowmoss]

I bought a new Jeep Wrangler, base model, back in 2008.  I'm glad I bought it.  I probably won't buy another.  It's a Jeep thing.  I do still love it, and consider it my 'new' Jeep.  At least it should last her quite a while if she's going for a Wrangler.  In my eyes, if she's going for one of the other models, yeah, steer her to something else.  Why buy a Jeep if it isn't a Wrangler?

I'm totally serious.  However, I know I'm not in with the proper party line here.  I have always bought new and driven until the wheels fall off.  1 diesel Rabbit, 3 Toyota trucks (not the monsters they sell now...) and 1 Jeep since 1980.  All but one truck and the current Jeep driven to over 200K miles, one truck 300K+ and still in use by a friend.

[CarDude]

I just talk about my experiences.  For example (I actually bought a new care years ago..unfortunately), "I wish I hadn't bought my car new because...XYZ".  Similarly, "I know where you're getting at, however, I bought used and it was a great decision because...XYZ".  Talking like this encourages people to learn from other people's experiences.  Don't tell her what to do, she probably won't listen.  If she won't learn from your experience, she may just have to go out and learn on her own.

Understand that money isn't everything to most people.  Everyone deserves what they want, or at least that's how 98% of the people I work/live/deal with are like :/

I think this is most likely to work.