Author Topic: So I Bought A Truck...  (Read 10993 times)

Just John

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So I Bought A Truck...
« on: July 17, 2013, 09:09:15 PM »
Hi There,

As of about a week ago, my wife and I (we are 28 yrs/o )became adherents to the wise words of the 'stash, acolytes of the frugal lifestyle, and, most importantly, quick adopters of the real, practical steps a couple could take on the daily to advance their financial health. All of this has been phenomenal. However, at the risk of being a "complainy pants," there is a dark side to all of this: I discovered the website about 3 weeks too late:

I am prone to worry and I constantly analyze any and all purchases I make (Do we REALLY need to eat today?). I also strive for constant optimization, attempt to use my own brain and handy-skills whenever possible, and am a true believer in hard work over convenience: I was a mini-mustachian before I even knew it! But all of this came to a halt recently- My beautiful, intelligent, and savvy wife and I fell pray to extreme consumerism and purchased... a 2013 F-150 (I can feel the shame and discomfort as I type this- and I will spare you the not-so-great reasons that this purchase was made, due to the fact that we now understand they were/ are all hogwash. I am an asshat). THAT'S when I found the blog. Oh, the inner turmoil that has hit me in the days since!

BUT, I am starting to see my way out of the haze of self-disappointment as I realize that we have learned a valuable lesson and that we can only attempt to make more well-informed decisions from this point on. The question is: What is the next step? Do we attempt to sell the brand new truck, take the loss, pay off the debt, and chalk this up to a giant mistake? OR do we keep the truck, pay off the debt, and use the truck until it dies? A different move altogether?

The Deets: We owe less than the truck is worth ($29K owed vs. a value of $32K), we have an APR of 0.75%, and we expect to pay it off in 1.7 years.

Thank you for any of your time and I look forward to seeing what you have to say!

bogart

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Re: So I Bought A Truck...
« Reply #1 on: July 17, 2013, 09:17:19 PM »
Unless there is some logical reason why you need a truck of that size and capacity (you run a landscaping business and need it to haul trees around?), you sell the truck and replace it with something that will get you where you need to be more cheaply and with a lower environmental impact.  Depending on your circumstances, this could be a pair of tevas, a bicycle, or a used Toyota Matrix, to name a few examples.

onehappypanda

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Re: So I Bought A Truck...
« Reply #2 on: July 17, 2013, 10:15:33 PM »
My assumption is that the truck is going to cost you a LOT in gas, interest, and payments than it's worth. Run the numbers yourself if you'd like, but to me it makes the most sense to sell it now while depreciation is minimal, pay off the debt, and find a more sensible vehicle. Even if you need a truck occasionally, you'd probably still save by borrowing or renting one as needed and driving a smaller car.

Don't spend too much time wallowing in turmoil- we ALL make mistakes. To me, the key is to minimize the damage, take it as a life lesson, and move on. Too much turmoil is counterproductive ;)

shadowmoss

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Re: So I Bought A Truck...
« Reply #3 on: July 17, 2013, 11:29:18 PM »
Look at the reasons you bought the truck.  The real reasons.  I drove Toyota trucks for close to 30 years.  I decided to change to a Jeep Wrangler because I wanted 4WD and the Toyota trucks now are way too expensive for me.  I miss my truck!  I seem to always need the room of the truck.  However, YMMV.  Look at YOUR life.  Look at YOUR reasons.  Everything is a trade off.  Is there a better way?  Probably, no matter what decision you make there is one more 'perfect' out there.  Drink the Kool-Aid here, but don't feel like you have to make a total diet of it.

MissStache

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Re: So I Bought A Truck...
« Reply #4 on: July 18, 2013, 08:17:53 AM »
My assumption is that the truck is going to cost you a LOT in gas, interest, and payments than it's worth. Run the numbers yourself if you'd like, but to me it makes the most sense to sell it now while depreciation is minimal, pay off the debt, and find a more sensible vehicle.

I'll agree to this and add insurance!  It must cost a fortune...

Rebecca Stapler

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Re: So I Bought A Truck...
« Reply #5 on: July 18, 2013, 09:18:33 AM »
Can you return it? I think some dealerships have a 30-day guarantee? Even if you trade it in for a comparably priced, but more fuel-efficient, car it would be better than keeping the truck. (although maybe not as good as taking the hit and selling the truck outright)

NCoffey

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Re: So I Bought A Truck...
« Reply #6 on: July 18, 2013, 09:19:38 AM »
Honestly, if you think a bit there are a lot of ways to make money with a truck. If you live somewhere that isn't just a big city, then you can advertise  that you can cut up and remove fallen trees or haul junk away for a fee. Then you take it somewhere and sell it (scrap yard for random metals and such as well as the cut up fallen tree as firewood.) You make money on both ends if you are willing to do a little work. I was actually planning on doing something like that to be self-employed. For the super thrifty, there are also lots of free things on craigs list and other yardsale like sites if you have a way to get it. A truck helps in that.

The brand new big truck may be excessive, but it could have been worse. At least a truck is useful.

Jamesqf

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Re: So I Bought A Truck...
« Reply #7 on: July 18, 2013, 11:14:38 AM »
I drove Toyota trucks for close to 30 years.  I decided to change to a Jeep Wrangler because I wanted 4WD and the Toyota trucks now are way too expensive for me.  I miss my truck!

But the good thing about Toyota trucks is that you don't need to buy new ones.  They run just fine when they're close to 30 years old.  (Got an '88 4WD in my driveway right now.)

DanBrewMan

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Re: So I Bought A Truck...
« Reply #8 on: July 18, 2013, 01:23:38 PM »
Dude.  I completely feel your pain.

I was in a very similar situation when I stumbled upon this forum; I had just purchased a 2013 Subaru WRX.  I ended up selling it with <3k miles on it, driving my beater for awhile, and then finding a used 2010 Hyundai Elantra Touring for nearly 1/3 of the price and have been driving it ever since.  Here's my (very similar) forum post from that time.  There you can see how much I deliberated...

http://www.mrmoneymustache.com/forum/ask-a-mustachian/should-i-sell-my-2-month-old-subaru-wrx/msg63851/#msg63851

So here I am, several months later, and I couldn't be happier with my decision.  It took at least 2 months for me to go from "the WRX is so awesome, I really miss it" to "Yeah the WRX is awesome, but $30k? Really?!" and then finally to "I love my Hyundai". 

If it were up to me, I wouldn't own a car at all, but I do need one for the time being.  But having a reliable used car that isn't for show is, in my mind, the closest thing to not owning a car.  All those worries that are bouncing around constantly in the back of your mind like "can't park to this guy, he'll ding my car for sure" or "this road is so rough, probably going to have rocks chipping off my paint" will completely disappear and your car will truly become a machine designed to transport you long distances in a short amount of time.

I was driving on a gravel road during vacation in the Hyundai and ended up putting a big dent in the front bumper cover and my only reaction was *shrug*.  I would have freaked if that was a WRX.

Additionally, I'm not afraid to work on the car.  I've never worked on my own cars, and being able to learn how to maintain the Hyundai myself has been a great experience.  I do oil changes all by myself now! :)

I say sell it.  Yeah it sucks, but over the long term not only will you save yourself some money, but you are making a big decision that will set the stage for a more MMM-type lifestyle for decades to come.

Good luck.  Let us know how it works out.

onehappypanda

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Re: So I Bought A Truck...
« Reply #9 on: July 18, 2013, 02:23:47 PM »
Honestly, if you think a bit there are a lot of ways to make money with a truck. If you live somewhere that isn't just a big city, then you can advertise  that you can cut up and remove fallen trees or haul junk away for a fee. Then you take it somewhere and sell it (scrap yard for random metals and such as well as the cut up fallen tree as firewood.) You make money on both ends if you are willing to do a little work. I was actually planning on doing something like that to be self-employed. For the super thrifty, there are also lots of free things on craigs list and other yardsale like sites if you have a way to get it. A truck helps in that.

The brand new big truck may be excessive, but it could have been worse. At least a truck is useful.

True, but will that really make up for the thousands of dollars they're going to pay on a $30K car loan, plus the increased cost of carrying full insurance (since they owe on it), plus the fuel consumption biting into the profits of everything they do. Not to mention the crazy new-truck sticker price.

If you actually wanted to make money just by hauling stuff away with a truck, you could get an old Toyota truck for $2,000 that'll do the exact same thing. Hell, my friend inherited a 1992 Windstar van that'll haul furniture.

Jamesqf

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Re: So I Bought A Truck...
« Reply #10 on: July 18, 2013, 04:50:22 PM »
...you could get an old Toyota truck for $2,000 that'll do the exact same thing.

Or do it better, because (as DanBrewMan points out above) you don't worry about dings & scratches, or getting your shiny new bed dirty, so you load up faster.  Just say "WTF" and toss it in :-)

Just John

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Re: So I Bought A Truck...
« Reply #11 on: July 19, 2013, 11:55:19 PM »
'Stash World,

Thank you to everyone who responded so far, we sincerely appreciate the different thoughts you have all provided! It's funny, a small part of us is caught up in the ego side of things (what will our friends think when we have to sell this brand new truck!?). That definitely will not deter us from making the right decision, but it is interesting how easily caught up people can get in "things" without even realizing it.

My wife and I have spent the last few days hammering out our budget, pairing down expenses, and trimming the fat where we can. Needless to say, the discovery of the main blog, this forum, and you contributors has made us look at finance, necessity, and the future in a whole new way. Ultimately, I believe that we will make the decision to sell (a decision that, while not easy, I would love to share here when it happens) and soon. It seems that there are just too many positives staring us in the face to pass this up.

With that, we have a couple of follow up questions: Given our income and budget, we determined that we would be able to pay off the entirety of the debt within about 7 months. Because the interest rate is so low (0.75%), do we continue to pay down the loan as aggressively as possible OR do we contribute to some sort of investment (Mutual Funds, etc) while paying off the loan at the same time, although at a slower rate?

@DanBrewMan- How did you sell your vehicle? Was it private sale or another form? Thanks again for your story- helps to know others may be in a similar boat (or truck).

Thanks

Paul der Krake

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Re: So I Bought A Truck...
« Reply #12 on: July 20, 2013, 03:45:23 AM »
At the very least, I would max out your tax-advantaged accounts for the year before making extra payments on a .75% loan. Once that window closes, it's gone.

little_owl

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Re: So I Bought A Truck...
« Reply #13 on: July 20, 2013, 05:22:16 AM »
Listen to JustJohn, and others.  Sell the damn truck now, assuming you cannot return to the dealer.

You will be well served to do a private sale, this truck would be a great buy for some other sucker who wants to piss away their hard earned dollars on gas and insurance for a big truck.

You can save yourself!!

Keep us updated...

hybrid

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Re: So I Bought A Truck...
« Reply #14 on: July 20, 2013, 11:10:19 AM »
...you could get an old Toyota truck for $2,000 that'll do the exact same thing.

Or do it better, because (as DanBrewMan points out above) you don't worry about dings & scratches, or getting your shiny new bed dirty, so you load up faster.  Just say "WTF" and toss it in :-)
[/quote

I couldn't agree more.  I have a 96 Mazda B2300 we hang onto because we use it for truck stuff at least a dozen times a year and I never worry about how it looks any more.  And when the AC compressor went after 17 years of service?  Too bad, riding with the windows down now.  A beater truck is the way to go.

DanBrewMan

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Re: So I Bought A Truck...
« Reply #15 on: July 22, 2013, 07:26:41 AM »
I took my car to carmax and got a VERY reasonable offer.  Might be worth a shot, they'll let you take the offer home and think about it for 7 days.

Just John

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Re: So I Bought A Truck...
« Reply #16 on: July 23, 2013, 09:33:38 PM »
Hello All,

Again, thank you for the thoughtful comments and general (and necessary) kicks-in-the-ass. Just a brief update: My wife and I have decided suck it up, do the sensible thing, sell the truck (probably via CarMax) and eliminate our debt. I will check back in when the deed is done for one final check-in.

We were talking today how truly badass it is that resources like this exist: In the span of a few weeks we have taken a number of philosophies and approaches discussed on these pages and applied them to our own lives, vastly improving our future. A big thank you to all who took the time to read OUR humble entry and even greater thanks who took additional time to reply. We look forward to more great reading and advice.

Sincerely,

John

Self-employed-swami

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Re: So I Bought A Truck...
« Reply #17 on: July 23, 2013, 10:59:01 PM »
And just as another option, there is a middle ground between a total 1980's beater Toyota truck, and 2013. I drive A LOT for work (like 35,000km last year, all paid for by my clients) and I did it in a 2006 Tundra.  It has all the creature comforts (power everything, A/C, cruise control) while not costing upwards of $40,000.

I had an unfortunate accident in February with the 2006 Tundra, so I bought a 2005.  I paid $11,000 for it, and it is in better shape than the 2006 that insurance gave me $15,000 for (I paid $15,500 for it in 2010, and put 60,000km on it since then).

But, I don't drive around in it, for sheets and giggles.  It has been parked for a week, on the driveway, and hasn't moved.  It was parked for a week on the street before I moved it onto the driveway.  My 'daily driver' is a 1995 tercel I paid $575 for in April.  I use the truck only for work (which I haven't done since February) and for the odd dump run, flood clean-out, or furniture acquisition.

For me, gas in the truck is the #1 expense for work, and so I don't let that spill over into my personal finances.
« Last Edit: July 23, 2013, 11:01:35 PM by Self-employed-swami »

lifejoy

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Re: So I Bought A Truck...
« Reply #18 on: July 23, 2013, 11:29:10 PM »
Kudos for being so willing to change! I'm very impressed with your ability to reassess the situation.

AlmostIndependent

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Re: So I Bought A Truck...
« Reply #19 on: July 26, 2013, 01:56:02 AM »
CarMax gave my SO a decent offer for her big expensive financed SUV. In the end Craigslist got the job done with some extra $ in her pocket. She lost some money short term but is coming out WAY ahead in the long run.

aaronpct

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Re: So I Bought A Truck...
« Reply #20 on: July 26, 2013, 08:38:38 AM »
I'm also in a similar situation, I have a 2012 VW GTI which I purchased brand new about a year ago.  It has less than 20k miles and i've financed it at 1%.  Fortunately with my previous trade-in I still owe a little less than the KBB value. 

After reading these forums, i've thought about selling it and buying a cheaper car (exchange a 20k loan for a 10k or less loan) but because my credit got killed around the same time because of a short-sale I feel my financing options are limited until it gets back over 700.

Any suggestions on what I should do?

Self-employed-swami

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Re: So I Bought A Truck...
« Reply #21 on: July 26, 2013, 08:45:31 AM »
I'm also in a similar situation, I have a 2012 VW GTI which I purchased brand new about a year ago.  It has less than 20k miles and i've financed it at 1%.  Fortunately with my previous trade-in I still owe a little less than the KBB value. 

After reading these forums, i've thought about selling it and buying a cheaper car (exchange a 20k loan for a 10k or less loan) but because my credit got killed around the same time because of a short-sale I feel my financing options are limited until it gets back over 700.

Any suggestions on what I should do?

Sell the VW, and buy whatever you can afford to, in cash.  Don't get another loan.  If you can't afford to buy anything with cash, ride the bus, or bike until you can.

http://www.mrmoneymustache.com/2011/11/28/new-cars-and-auto-financing-stupid-or-sensible/?doing_wp_cron=1374849918.6995449066162109375000

aaronpct

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Re: So I Bought A Truck...
« Reply #22 on: July 26, 2013, 11:13:47 AM »
I'm also in a similar situation, I have a 2012 VW GTI which I purchased brand new about a year ago.  It has less than 20k miles and i've financed it at 1%.  Fortunately with my previous trade-in I still owe a little less than the KBB value. 

After reading these forums, i've thought about selling it and buying a cheaper car (exchange a 20k loan for a 10k or less loan) but because my credit got killed around the same time because of a short-sale I feel my financing options are limited until it gets back over 700.

Any suggestions on what I should do?

Sell the VW, and buy whatever you can afford to, in cash.  Don't get another loan.  If you can't afford to buy anything with cash, ride the bus, or bike until you can.

http://www.mrmoneymustache.com/2011/11/28/new-cars-and-auto-financing-stupid-or-sensible/?doing_wp_cron=1374849918.6995449066162109375000

Thank's for your thoughts, will read up on it now and will begin looking into what type of reliable car I can pay for with cash.  I know MMM has posted a list of some reliable models/years that I will investigate as well.

DanBrewMan

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Re: So I Bought A Truck...
« Reply #23 on: July 26, 2013, 12:10:58 PM »
Glad you're able to work though this tough decision.  I was a little worried about the social implications, but ended up saying "to hell with it!" and selling.  Whenever I explain it to family or friends I always get responses like "Wow!  That's some discipline!" or "Maybe we should do that!".  Just spreadin' the good word!

AlmostIndependent

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Re: So I Bought A Truck...
« Reply #24 on: July 26, 2013, 12:40:00 PM »
Glad you're able to work though this tough decision.  I was a little worried about the social implications, but ended up saying "to hell with it!" and selling.  Whenever I explain it to family or friends I always get responses like "Wow!  That's some discipline!" or "Maybe we should do that!".  Just spreadin' the good word!

Its nice when hard work is noticed. My SO caught some shit from a coworker of mine about what a waste of money it was to sell her SUV after she bought it new a year ago. We both just rolled our eyes. My coworker is broke and always complaining about not having enough money (she is always driving her newish Mercedes SUV to the outlet mall for shopping.)

ritchie70

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Re: So I Bought A Truck...
« Reply #25 on: July 26, 2013, 11:44:01 PM »
I'm also in a similar situation, I have a 2012 VW GTI which I purchased brand new about a year ago.  It has less than 20k miles and i've financed it at 1%.  Fortunately with my previous trade-in I still owe a little less than the KBB value. 

After reading these forums, i've thought about selling it and buying a cheaper car (exchange a 20k loan for a 10k or less loan) but because my credit got killed around the same time because of a short-sale I feel my financing options are limited until it gets back over 700.

Any suggestions on what I should do?

I have an '08 GTI that I bought with cash when it was a year or two old. It hasn't held value very well (not that cars ever do) and it doesn't feel like that well built of a car. Oh, and I'm constantly pouring oil into it.

If the '12 is similar, get out while you can still get decent money for it.

Micheal

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Re: So I Bought A Truck...
« Reply #26 on: July 26, 2013, 11:49:21 PM »
Sell the fat bastard take the 3k profit, pick up a truck on CL for 2k and insure it and you will still come out ahead, if you need a truck toyotas are pretty good and chevy makes a few small trucks that run well and are easy to repair, I rather like the old Chevy Love for personal reasons, a good used truck will cost about 1-2k depending on age and condition.