What to do with a car that’s now ‘too much?’

[scantee]

I’ve owned my current car, a 2017 Volvo v60 for 3.5 years. Purchased for ~$27k, lightly used. Paid off. It was a fantastic car when I was regularly commuting to work and driving my kids around. Safe, great in snow, comfortable but not too big, no issues whatsoever.

But for the past 1.5 it’s been mostly sitting in my garage getting very little use. Without a commute it turns out I drive very little. My kids are also getting older and are more able to get around by themselves by walking or biking.

In the last year I’ve spent about $400 on gas and parking. I fill up maybe every six weeks. My insurance costs are around $600/yr and registration $350/yr.

It’s starting to feel like this car is just too much for what I need right now. I’d like to get rid of it and get something smaller and cheaper but with the used car market being the way it is there are few good options. Everything seems overpriced relative to what I could get for my current car (~$22k). I’d like to get something in the ~$15k range, maybe a Golf or e-Golf or something similar but the only ones I’m finding in that price range are significantly old or have way more miles than my car (45k). I value that my current car I know to be very reliable whereas I don’t know that for an older car. How to quantify that is difficult though.

Any guidance from people who know more about the car market? Unsure if it makes sense to trade down and could use some help figuring that out first. Once I know that I feel like I can better home in on how much to spend, what type of car, etc. I could go carless for maybe 6 months, so also wondering if people think the used car market might come down by spring (unlikely, from what I’ve read, but maybe I’m wrong on that).

[Paper Chaser]

I can't see a time where you'd ever get more for your used vehicle than right now.
Sell it and buy a $5k-7k beater to get you through a year or two. Something that can't really depreciate any over that time. You don't drive much, so fuel economy shouldn't even really have much of an impact over the short term.
When prices have gotten more reasonable on the vehicle that you want, sell the beater for a minimal loss and get what you want.

[RWD]

Downgrading from a $22k car to a $15k car is unlikely to save much money due to transaction costs (sales tax, fees, haggling, etc.). Though you could do some estimates to see if there is a significant difference for your expected use (e.g. running costs will be cheaper on an e-Golf). But if you really want to save money you'll probably have to go the route suggested by Paper Chaser.

[boarder42]

Downgrading from a $22k car to a $15k car is unlikely to save much money due to transaction costs (sales tax, fees, haggling, etc.). Though you could do some estimates to see if there is a significant difference for your expected use (e.g. running costs will be cheaper on an e-Golf). But if you really want to save money you'll probably have to go the route suggested by Paper Chaser.

Sales tax should offset. At least it does in my state. Sell are car for 20k buy a car for 20k or less pay no sales tax

[CrabbitDutchie]

The obvious solution is to sell your car to @ObviouslyNotAGolfer and buy their 740 in return.

Seriously though without knowing more about your situation I have no idea what makes sense.

[ChpBstrd]

I can't see a time where you'd ever get more for your used vehicle than right now.

Agreed. People are doing stupid things for used cars. You're driving a luxury car and have only suffered depreciation of $5k in 3.5 years ($1428/y)? That's winning the lotto.

Now if you want to fully optimize, you'll have to cash in that lotto ticket before it expires. Ideally, you could go maybe a year without a car, waiting for the used market to calm down. Then you could buy something from the sucker who bought in 2021 and got hit by depreciation once the chip shortage eased up. If you can pull this off, you'll save at least $2k in related expenses, PLUS perhaps $5-7k in depreciation, depending on how things go with the used car bubble. Maybe subtract a few dozen Uber or Lyft rides from the savings, but you still have massive savings. If your savings only amount to $5k, consider that to earn that amount of money from 10 year treasuries would require an investment of $384,615!

Sell it and buy a $5k-7k beater to get you through a year or two. Something that can't really depreciate any over that time. 

This is a good strategy to beat depreciation, especially if you don't need to put a lot of miles on the vehicle. Yes, you'll have to pay sales tax if you later go from the $5-7k car to another $27k car, but that doesn't make up for the savings in depreciation or from going to liability-only insurance. Besides, why would you upgrade later? As long as you can WFH, you should take advantage by keeping car expenses low.

[RWD]

Downgrading from a $22k car to a $15k car is unlikely to save much money due to transaction costs (sales tax, fees, haggling, etc.). Though you could do some estimates to see if there is a significant difference for your expected use (e.g. running costs will be cheaper on an e-Golf). But if you really want to save money you'll probably have to go the route suggested by Paper Chaser.

Sales tax should offset. At least it does in my state. Sell are car for 20k buy a car for 20k or less pay no sales tax

This is state-dependent. You may also have to use a dealership to qualify (which is not ideal for maximizing your dollar).

[scantee]

I can't see a time where you'd ever get more for your used vehicle than right now.
Sell it and buy a $5k-7k beater to get you through a year or two. Something that can't really depreciate any over that time. You don't drive much, so fuel economy shouldn't even really have much of an impact over the short term.
When prices have gotten more reasonable on the vehicle that you want, sell the beater for a minimal loss and get what you want.

Sounds like this approach is my best bet. I haven’t really looked at cars in this price range so I’ll have to get a handle on what’s out there first.

Something I didn’t mention in my first post is that I’d like to use some of the proceeds from a car sale on an ebike. I plan to buy an ebike regardless of what I do with my car but will likely get a nicer bike if I sell my car. An ebike with decent cargo capacity should allow me to go longer without a car if I do decide to go the route of being carless for awhile.

[boarder42]

Downgrading from a $22k car to a $15k car is unlikely to save much money due to transaction costs (sales tax, fees, haggling, etc.). Though you could do some estimates to see if there is a significant difference for your expected use (e.g. running costs will be cheaper on an e-Golf). But if you really want to save money you'll probably have to go the route suggested by Paper Chaser.

Sales tax should offset. At least it does in my state. Sell are car for 20k buy a car for 20k or less pay no sales tax

This is state-dependent. You may also have to use a dealership to qualify (which is not ideal for maximizing your dollar).

We do not have to use dealers. Just bring bill of sale when you register the new car. Or mail it in within 6 months of new purchase for refund.

[Ecky]

The classic answer is Honda Fit. 2009-2014 models have incredible reliability. 2015+ models are still highly reliable, but they're not quite as insanely bulletproof.

After watching one of my coworkers go through four Volvos in as many years, I'm wary of the brand. At 45k miles yours is still young, but I've observed their recent vehicles having a lot of very silly and expensive issues by 150k miles - things like computers burning out and AWD systems failing, or even bad design stuff like an alternator that requires 7 hours of labor to replace because you need to drop the transmission to get to it. Meanwhile the Hondas and Toyotas are rust buckets at 250k miles, but aside from the rust, rarely does anything major or expensive fail.

[Fishindude]

I'd just keep what you have and use it when you need it.   You know what you have, whereas if you buy something else, you could be walking into someone else's problems.
It's not a like horse you have to feed and care for every day.   

[darknight]

If you're ready to really make a change, sell it. If you're going to sell for ~$20k and buy a ~$12k car DON'T do it. You likely won't save much making a mediocre change. You'd be buying a slightly cheaper car with potential problems.

 If you are ready to really cut expenses, find a car valued no more than $3K. If you're willing to ask around a little, it can save you big. Give yourself a few weeks, and start today by mentioning it to co-workers and family. There are more people than you realize that have a cheap budget car sitting around that they don't know how to sell. Say "hey i'm looking to get a good inexpensive runaround car, do you have (or know of any cars) for sale around $3k" etc etc.
I have purchased many vehicles this way. A few years ago I literally was driving and saw an older toyota camry in a driveway that looked quiet nice. I knocked on the door and complimented the guy on his Toyota and asked if he knew anyone else with one that wanted to sell... (it was the camry station wagon) his response "well, I am"! A week later I was driving the toyota haha.

[ender]

Downgrading from a $22k car to a $15k car is unlikely to save much money due to transaction costs (sales tax, fees, haggling, etc.). Though you could do some estimates to see if there is a significant difference for your expected use (e.g. running costs will be cheaper on an e-Golf). But if you really want to save money you'll probably have to go the route suggested by Paper Chaser.

Sales tax should offset. At least it does in my state. Sell are car for 20k buy a car for 20k or less pay no sales tax

This is state-dependent. You may also have to use a dealership to qualify (which is not ideal for maximizing your dollar).

When we recently bought a car from a dealership, I had offers from Carmax/Carvana and so they basically matched what I'd get if I sold it to them.

Not that Carvana/Carmax are maximizing either but it gives you an alternate option to set a "floor" if you will for what the dealership has to offer, which is almost guaranteed to be higher than what it would be otherwise.

The dealership effectively gave us what Carmax was going to as a result.

[markbike528CBX]

Consider donating it to a worthy cause.

Our local PBS TV takes cars in any condition.    Who knows you might be able to get a tax writeoff.

FWIW Kelly blue book says 18-22K.

[Sandi_k]

Consider donating it to a worthy cause.

Our local PBS TV takes cars in any condition.    Who knows you might be able to get a tax writeoff.

FWIW Kelly blue book says 18-22K.

Why in the world would you do this? If you sell it, you get ~ $20k cash.

If you donate it, you get a deduction, which is $20k * (your marginal tax rate). Assuming a 22% tax bracket, that's $4400.

[markbike528CBX]

Consider donating it to a worthy cause.

Our local PBS TV takes cars in any condition.    Who knows you might be able to get a tax writeoff.

FWIW Kelly blue book says 18-22K.

Why in the world would you do this? If you sell it, you get ~ $20k cash.

If you donate it, you get a deduction, which is $20k * (your marginal tax rate). Assuming a 22% tax bracket, that's $4400.

Errr... donation... worthy cause?

[Paper Chaser]

If you're ready to really make a change, sell it. If you're going to sell for ~$20k and buy a ~$12k car DON'T do it. You likely won't save much making a mediocre change. You'd be buying a slightly cheaper car with potential problems.

 If you are ready to really cut expenses, find a car valued no more than $3K. If you're willing to ask around a little, it can save you big. Give yourself a few weeks, and start today by mentioning it to co-workers and family. There are more people than you realize that have a cheap budget car sitting around that they don't know how to sell. Say "hey i'm looking to get a good inexpensive runaround car, do you have (or know of any cars) for sale around $3k" etc etc.
I have purchased many vehicles this way. A few years ago I literally was driving and saw an older toyota camry in a driveway that looked quiet nice. I knocked on the door and complimented the guy on his Toyota and asked if he knew anyone else with one that wanted to sell... (it was the camry station wagon) his response "well, I am"! A week later I was driving the toyota haha.

The $3k cars of yesteryear are often $5k cars now. And what's out there for $3k now would've been $1500 a couple of years ago. There's a difference between a cheap used car with a decent amount of life left, and junk. In the current market, there's a lot more junk than quality at the $3k price point.

[Sandi_k]

Consider donating it to a worthy cause.

Our local PBS TV takes cars in any condition.    Who knows you might be able to get a tax writeoff.

FWIW Kelly blue book says 18-22K.

Why in the world would you do this? If you sell it, you get ~ $20k cash.

If you donate it, you get a deduction, which is $20k * (your marginal tax rate). Assuming a 22% tax bracket, that's $4400.

Errr... donation... worthy cause?

Errr. then sell the car, make the donation, and have enough for new-to-you transport.

[Retire-Canada]

I'd just keep what you have and use it when you need it.   You know what you have, whereas if you buy something else, you could be walking into someone else's problems.
It's not a like horse you have to feed and care for every day.

I'd keep it. I'm doing essentially the same with my lightly driven vehicle. I could get rid of it and downsize saving a few dollars, but the change would have an unnoticeable effect on my NW/annual spend and I'd have a vehicle I like driving less when I do drive.

If you are really keen to get rid of it I'd work all the numbers and make sure the change will be worth it for what you are getting rid of and what you'll end up with.

[Sibley]

Circumstances changed, which resulted in your car sitting mostly unused. Circumstances may change again. Just hang on to it for now. Minimize your carrying costs as you reasonably can.