I’m not sure which I dislike more – going to the dentist or going car shopping. Today, I decided it was time to take the leap and visit a car dealership to at least test drive a few cars and get a feel for what I’d like to buy. I went in with the plan to spend $14k – $16k on my next (used) car. I left wanting to buy a $26k 2013 Nissan Passat.
It’s not that I’m obsessed with the idea of buying a new car, I just happen to really like the design of cars built in 2012 and 2013. The Passat built before this, for instance, looks awful. Sure, looks aren’t anything, but if I’m spending more than $5k on something I’m going to drive everyday they matter.
But spending $26,000 on a car doesn’t make sense. Neither does spending $20,000. My last car I bought used from a private seller for about $8k after taxes. Granted, that was 7 years ago, but today I should be able to buy a similar car for $12k. So wasting an extra $8k – $15k just doesn’t make sense. I’m writing that a lot because I’m trying to convince myself of that.
I cannot keep driving the car I have right now. It may drive ok but it’s falling apart. So I’ve decided I must replace it in 2013. I’m still paying sky high insurance rates because of my DUI (the gift that keeps on giving), so it doesn’t at all make sense to buy a newer car (or lease one) and spend even more on comprehensive insurance.
What makes sense (probably) is to buy a used car – maybe even the same one I currently have, just a slightly newer model, or one made in the same year which is in better condition than my car. Or I get my car fixed, but at 194,000 miles, that doesn’t make a lot of sense either.
I’m thinking if I really like the 2013 Passat, by the time I am ready to buy my next car, there will plenty available used to buy for much less than $26,000.
But then again, I admire the type of people who can not think about these things, and who would lease a car new versus buying a used car. I do make $100k per year — I should be that type of person. I just can’t save $50k per year if I do that, so why bother?
For your income level buying that new Passat is well within your means. On the other hand, if you stick with your initial budget under $16K total, then you can invest that extra $10K today in a well balanced portfolio. If you get a modest 5% return per year then in 10 years from now that investment will be worth over $16K which you can then use to buy another used vehicle. Or you can lease now, and wait to see if you like the 2014 designs even more and maybe pick up one of those. Up to you 🙂
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