Author Topic: Using the GI Bill - Sell my Car?  (Read 453 times)

aquapanic

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Using the GI Bill - Sell my Car?
« on: June 01, 2018, 06:46:47 PM »
Ok so I have a very specific life event coming up - I am transitioning out of the military and am going to be living on a fixed-income for a while, to give you a clearer picture. I live in Bremerton Washington, and my finances look something similar to this in ten months:
Age:25
Mortgage: 1531/month (244,000 at 3.6%) (I live in a duplex that I own, am currently doing some small renovations to the unit I occupy so that it is also immediately rentable)
Water Bill: 135/month
Electricity: Highly Variable between 0 and $100/month
Solar Panels: 300/month
Food: 350/month
Gasoline: Currently $125/month (my car is currently necessary for my job)
Car Insurance: $100/month
Cellular Phone: $80/month
Internet: $80/month
Trash: $25/month
Rental Income: $1225/month (this can reasonably be increased to about 1450-1550/month)
BAH from Stipend: $1818/month
Current Assets:
Retirement Account (TSP) : $7000
Home Equity: $8000 w/o including price increases from the market.
Index Funds: $3000
Car: Blue book value $4116

What do we think about selling my car in 11 months when I get out? It will add no real transportation costs (going to Seattle is infrequent for me and would only cost approximately $8 round trip, $12 if I use the fancy fast ferry). I can suitably meet almost all of my daily transportation needs using a bicycle. The only question is: is it worth maintaining my Car for a once or twice monthly Costco trip, or should I give up and bike to Safeway/Fred Meyer which are closer? An Uber to and from Costco would add approximately $40 per trip to my costs. I am going to be going to school extremely local, then transferring to a larger school on the Seattle side, which will significantly impact my transit costs (the car becomes even more of a liability here and I make more money from government here regardless, so we are really only talking about the year following my transition). I predict the twice-monthly Costco run, at a price of $80/month, will effectively save me $20 on Insurance per month (although I could replicate some of this by switching to a per-mile insurance program like Metromile), gas costs, and car repairs (the car currently has 135k miles on it and is paid off).  This trip will cost me $880 dollars for the timeframe considered, and I gain $3000 (approx) at the low end of selling my car. It appears to me that selling my car is the right choice to make, especially after making considerations for the time value of money (that $3000 makes me $210 dollars that year in index funds approximately). Any thoughts? Things I am not factoring in?

The part that I hate the most is committing to paying for a convenience (Uber) to make a necessary trip (Costco) - if a Mustachian in the Washington area has done an extensive analysis of Costco vs. Fred Meyer (my option on the bike) and finds that Fred Meyer and Costco are roughly equivalent (I am not sure if this is possible without doing some sort of extreme couponing) this makes the decision easier. There is also the potential risk that the $3000 in cash-in-hand very quickly becomes "lots of previously unnecessary uber rides for me to do things I used to use the car for".

Is there anything else I am not thinking about or categorically wrong on?