Author Topic: Cycle, Cars, Cash  (Read 1556 times)

JCfire

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Cycle, Cars, Cash
« on: July 07, 2014, 11:45:27 AM »
Early in my journey towards financial independence, I've learned that I have it easy.  I have a good income, and I have a very firm idea of what I actually care about.  So now that I've actually woken up and stopped drifting through my financial life on autopilot, I've grown to hate two things more than anything else: spending money voluntarily on things I don't care about, and paying more taxes than I would have needed to with careful planning.

Until recently, I owned a nice and nearly-new car.  I bought it new in 2009 and paid off the loan in 2011.  I counted myself frugal for just not carrying debt on the car.  But there is so much in that car that I realized I don't care about.  It has a great NAV system I never used.  It had fancy sports suspension and expensive tires that I only used to drive 30mph down a straight road for 3 miles on my daily round trip commute.  It only had 40k miles on it, when I would be comfortable driving a car with twice as many miles at least.  I realized that even though I like the car as a whole, I had paid for a lot of expensive things I didn't really want.

As luck would have it, a family member told me he was planning to sell his older vehicle to upgrade.  His car had around 80,000 miles on it, no NAV system, no fancy sports suspension, dents on the doors and a crack in the rear bumper, and it really needed a car wash.  "Perfect", I thought.  My relative and I worked out a car swap.  He got my car, I got his car and several thousand dollars.  At least in my state, vehicle transfers between close family members are not taxable events, so I avoided giving the government the money that they would have made had I visited a car dealership. 

I used part of the cash windfall to buy my first bicycle, a Specialized Sirrus Sport from the old model year, so now I will be putting even fewer annual miles in.  The cheaper vehicle and lower annual mileage mean lower car insurance bills too!

All together, this transaction makes me about $22,000 richer over the next 10 years with compounding.  And as it turns out, my new vehicle has a bit more headroom and it tracks fuel economy better than my last car, so at least for the moment I enjoy it more than my last one!

-- JC

PindyStache

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Re: Cycle, Cars, Cash
« Reply #1 on: July 07, 2014, 02:15:41 PM »
Thanks for sharing, what a great change in your life! You haven't even included an estimate of the health and wellness benefits of cycling! I also started my bicycle journey with an old model year hybrid (a very similar Trek 7.2 FX). I hope you find many happy cycling & cheaper driving days ahead.

JCfire

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Re: Cycle, Cars, Cash
« Reply #2 on: July 07, 2014, 02:20:42 PM »
Thanks for sharing, what a great change in your life! You haven't even included an estimate of the health and wellness benefits of cycling! I also started my bicycle journey with an old model year hybrid (a very similar Trek 7.2 FX). I hope you find many happy cycling & cheaper driving days ahead.

Thanks!  I have only put about 20 (very hilly) miles on the bike so far but I do think health benefits are in the cards -- as long as I survive the first couple months of adjustment!