Selling a car I just bought?

[FlyJ]

I haven't had a car for over two years. I ride my bike, use micro-mobility, Uber, public transit and rent a car when necessary. Unfortunately, the pandemic hindered my mobility with reduced transit frequency, removal of Jump bikes, etc., and has generally left me feeling sort of isolated due to a lack of things to do. The idea of buying a car crept into my mind as a result and, over a stretch spent with my uber consumer parents encouraging the decision, I decided to do it.

The car is a used RAV4 I found for $12,000. I have a $9,000 loan. I've used the car some, but quickly realized that it was the wrong decision. An e-bike would have given me that bit of extra reach I want and, as a sort of anti-car urbanist, I feel terrible every time I drive. Having the car sitting out there and feeling the weight of my now being responsible for it is awful. And venturing into the sprawl wasteland full of big trucks infuriates me. I've hardly driven it and don't want to.

With taxes, maintenance, equipment, fees, etc., I've spent close to $2,000 getting the car fixed up, and also don't think I could sell it for what I paid. In selling the car, I suppose I'd lose about $3,000 total ($11k sale price + $2k fees), which is what my transportation expense would have been for the second half of this year before getting a car. I've calculated that keeping it costs about $10 per day.

Selling the car doesn't make financial sense at this point, but it'd certainly make me feel a lot better and allow me to return to living my values. Is it justifiable to call this mistake a sunk cost and get back to cycling everywhere?

I live in Austin, TX, which is an auto-centric town, so getting by without a car isn't exactly easy. My employment and schedule allow me to be a transportation extremist, but if my situation were to ever change, a car might become necessary.

[jfer_rose]

Makes sense to me to consider this a sunk cost and move forward accordingly. Take some time to carefully consider how you want to handle transportation moving forward-- thinking about all the seasons in case that would have an impact. If the car doesn't make sense, go ahead and take the loss to sell it.

This is an interesting post to me and I am taking it to heart. I'm 42 years old and have never owned a car. I'm starting a business and having a car would make it SO much easier to do what I want my business to do (non-clown car driving, too: hauling lumber and other big loads). Yet I resist, I resist, I resist. I can only really picture myself driving fuel efficient cars if I have to drive one and fuel-efficient cars aren't great for carrying sheets of plywood. I think the lesson I will take from your story is to try other ways of doing this before I buy a vehicle that doesn't square with my self-image...

[FlyJ]

This is an interesting post to me and I am taking it to heart. I'm 42 years old and have never owned a car. I'm starting a business and having a car would make it SO much easier to do what I want my business to do (non-clown car driving, too: hauling lumber and other big loads). Yet I resist, I resist, I resist. I can only really picture myself driving fuel efficient cars if I have to drive one and fuel-efficient cars aren't great for carrying sheets of plywood. I think the lesson I will take from your story is to try other ways of doing this before I buy a vehicle that doesn't square with my self-image...

You're setting a great example with your resistance. Thank you. A moment of weakness on my part I suppose. As highways, big box stores and giant trucks continue to dominate, it can be hard being a hold out.

[MilesTeg]

I haven't had a car for over two years. I ride my bike, use micro-mobility, Uber, public transit and rent a car when necessary. Unfortunately, the pandemic hindered my mobility with reduced transit frequency, removal of Jump bikes, etc., and has generally left me feeling sort of isolated due to a lack of things to do. The idea of buying a car crept into my mind as a result and, over a stretch spent with my uber consumer parents encouraging the decision, I decided to do it.

The car is a used RAV4 I found for $12,000. I have a $9,000 loan. I've used the car some, but quickly realized that it was the wrong decision. An e-bike would have given me that bit of extra reach I want and, as a sort of anti-car urbanist, I feel terrible every time I drive. Having the car sitting out there and feeling the weight of my now being responsible for it is awful. And venturing into the sprawl wasteland full of big trucks infuriates me. I've hardly driven it and don't want to.

With taxes, maintenance, equipment, fees, etc., I've spent close to $2,000 getting the car fixed up, and also don't think I could sell it for what I paid. In selling the car, I suppose I'd lose about $3,000 total ($11k sale price + $2k fees), which is what my transportation expense would have been for the second half of this year before getting a car. I've calculated that keeping it costs about $10 per day.

Selling the car doesn't make financial sense at this point, but it'd certainly make me feel a lot better and allow me to return to living my values. Is it justifiable to call this mistake a sunk cost and get back to cycling everywhere?

I live in Austin, TX, which is an auto-centric town, so getting by without a car isn't exactly easy. My employment and schedule allow me to be a transportation extremist, but if my situation were to ever change, a car might become necessary.

Sunk cost, lesson learned imo. You are o ly going to lose more money if you keep it longer with no no usage.

[Clever Name]

If you want to be completely rational, you should absolutely consider it a sunk cost, because it is. But if you want to be completely rational you should also discard your emotional baggage about having a vehicle and make the decision based purely on the utility the vehicle does or does not provide relative to the cost of keeping it.

[FlyJ]

If you want to be completely rational, you should absolutely consider it a sunk cost, because it is. But if you want to be completely rational you should also discard your emotional baggage about having a vehicle and make the decision based purely on the utility the vehicle does or does not provide relative to the cost of keeping it.

You put it well. I should have asked the question in that way. Keeping the car in now the financially rational choice, as its cost replaces that of the Ubers and rental cars I would have used instead, with the added plus of it being more convenient. The sunk cost erases any chance of getting an e-bike from my budget, so it's a step backward in terms of mobility. The choice is about putting values and idealism over finances and practicality - a very first-world problem I suppose.

[HPstache]

Do you have a way to calculate what you spent on Uber and other forms of transportation in years past?

[FlyJ]

Do you have a way to calculate what you spent on Uber and other forms of transportation in years past?

Yes, I've used YNAB for a few years. My transportation expense for the second half of the year would have been around $3200. With the car, taxes, fees, payment, maintenance, etc., the car blows that out of the water. Over a number of years, however, it'd even out with fewer rental cars/Ubers. I travel for work, though, so that won't be completely eliminated.

[ericrugiero]

Do you have a way to calculate what you spent on Uber and other forms of transportation in years past?

Yes, I've used YNAB for a few years. My transportation expense for the second half of the year would have been around $3200. With the car, taxes, fees, payment, maintenance, etc., the car blows that out of the water. Over a number of years, however, it'd even out with fewer rental cars/Ubers. I travel for work, though, so that won't be completely eliminated.

So it sounds like the sunk cost makes the yearly transportation expense higher with the car. That cost is already spent so right now I would calculate the ongoing cost of ownership and compare to your normal transportation costs. A $10000 rav4 isn’t going ton depreciate much and also “should” be pretty reliable. So, I would guess it’s cheaper to keep the car.

It’s OK to include personal preference in this equation. If the car is driving you nuts maybe it’s worth it to sell even if that’s not financially optimal. Just be honest about the cost and justification.

[Zette]

Random idea: you could sign up to drive for Uber and turn the car into a side-hustle. 

[FlyJ]

So it sounds like the sunk cost makes the yearly transportation expense higher with the car. That cost is already spent so right now I would calculate the ongoing cost of ownership and compare to your normal transportation costs. A $10000 rav4 isn’t going ton depreciate much and also “should” be pretty reliable. So, I would guess it’s cheaper to keep the car.

It’s OK to include personal preference in this equation. If the car is driving you nuts maybe it’s worth it to sell even if that’s not financially optimal. Just be honest about the cost and justification.

Correct. There's no financial gain. The decision would be purely preference/values based. In part, I think I got worried about needing to be able to get to a new job in the event of a COVID-related layoff, but it never happened.

[Just Joe]

If you hate having it then sell it. However it sounds like you'll recoup the cost over several years.

As an ebike owner I recommend them. Also - consider a scooter. Like a bicycle it is a good fair weather way to get around. Simple to operate and cheaper than a car. Take a motorcycle safety course if you go that path. You don't know what you don't know. ;)

[Loren Ver]

So it sounds like the sunk cost makes the yearly transportation expense higher with the car. That cost is already spent so right now I would calculate the ongoing cost of ownership and compare to your normal transportation costs. A $10000 rav4 isn’t going ton depreciate much and also “should” be pretty reliable. So, I would guess it’s cheaper to keep the car.

It’s OK to include personal preference in this equation. If the car is driving you nuts maybe it’s worth it to sell even if that’s not financially optimal. Just be honest about the cost and justification.

Correct. There's no financial gain. The decision would be purely preference/values based. In part, I think I got worried about needing to be able to get to a new job in the event of a COVID-related layoff, but it never happened.

So it was more like an insurance policy for finding a job.  You can think of it that way if it helps with the transition.  You got some "term job finding insurance" that you no longer need.  Now you are going to cancel the policy.  Since you didn't need to find a job that required a car (a big Yah! since you don't like the driving) you are now merely stopping the policy.  It was an expensive per month policy, but if you needed it, it could have been a major job finder.  Security can be expensive, good thing it was temporary.

LV

[FlyJ]

So it was more like an insurance policy for finding a job.  You can think of it that way if it helps with the transition.  You got some "term job finding insurance" that you no longer need.  Now you are going to cancel the policy.  Since you didn't need to find a job that required a car (a big Yah! since you don't like the driving) you are now merely stopping the policy.  It was an expensive per month policy, but if you needed it, it could have been a major job finder.  Security can be expensive, good thing it was temporary.

LV

Ha! That's a great way to think of it. Not entirely false. My job will remain shaky for a bit. Maybe I'll just hold on to my policy until things are definitely stable.

[NorthernMonkey]

If it makes you sad, you should get rid of it. It’s not like a small car is a rare thing. You can easily find another.

This car is owning you and it’s dragging you down with it. There will never be a shortage of cars in Texas if you need another at short notice.

Life is too short to own things that make you sad.

[Loren Ver]

So it was more like an insurance policy for finding a job.  You can think of it that way if it helps with the transition.  You got some "term job finding insurance" that you no longer need.  Now you are going to cancel the policy.  Since you didn't need to find a job that required a car (a big Yah! since you don't like the driving) you are now merely stopping the policy.  It was an expensive per month policy, but if you needed it, it could have been a major job finder.  Security can be expensive, good thing it was temporary.

LV

Ha! That's a great way to think of it. Not entirely false. My job will remain shaky for a bit. Maybe I'll just hold on to my policy until things are definitely stable.

Mental framing can be a wonderful thing :).