Hi!
I've recently gotten a new job, in a new city about 3 hours away from the old one. The situation is a little odd, because while we now have an apartment in the new place, my wife is still taking a course at a community college in the old city. It's the last course she needs for a specialized technical certification, and she couldn't take it in the new city without losing her credits, so she'll be staying with friends or family and finishing out the semester before coming to live with me full time. We have been visiting each other on weekends, and plan to continue doing so.
The issue is, we don't have a car. I have a lot of student debt (detailed elsewhere), and until now we couldn't have afforded a car even if we had wanted one. The new apartment is close to public transit, and it's easy to bike from home to the new job, so we don't need it for local travel in the new city. But, with going back and forth between the two cities for visits, bus tickets add up, and also take much more time than driving. (6 hours by bus, 3 by car). We also have family and most of our friends in the old city, and would likely use the car to have more freedom to visit them occasionally.
I've done the math, and based on our current budget it will take us approximately three years to eliminate all of the loans. It will be significantly less time after my wife finds a job in the new city. We're looking at cars priced under $5000, and the difference between buying a car now or putting that money towards loans immediately is negligible, about one or two months either way. I've incorporated costs of insurance or gas into the budget as well, considering that we won't drive much and will only purchase liability insurance. However, I'm not totally sure what realistic numbers for these expenses are, given that I haven't had them for years, so some advice on that would be helpful.
We are trying to decide between the following options:
1) Buy a decent used car, hunting craigslist for reliable hatchbacks priced under $5000. Pay cash for it.
2) Buy a decent used car, hunting craigslist for reliable hatchbacks priced under $5000. Use a personal loan probably about (4%) from the bank to pay for it, and put the difference towards making a large lump sum payment to my loans, which have a higher interest rate.
3) Buy a beater, something old but of a reliable brand, for under $2000, and get a better car after it breaks down and/or the loans are paid off. Use the extra $3000 or so for an emergency fund or paying off student loans faster.
4) Do not buy a car, and put all the money towards paying off student loans faster.
5) Do not buy a car, and put all the money towards an emergency fund, which we currently don't have.
6) Say fuck it and buy a paraglider and a monkey.
We'd appreciate your thoughts, as we might be a little too close to this issue to think clearly about it. Thanks!