Ahhh vehicles. Everyone wants to have the newest and coolest car, because obviously that will make them look super cool, too. That $30k Jeep Wrangler looks GOOD. I fucking agree. Dream car goals right there. But who am I trying to impress? Everyone that knows me knows I’m a frugal fuck and would never finance a car again. Sometimes I want to say ‘fuck it’ and just go out and buy one. But in the back of my head, I have to keep telling myself that the $30k, plus $2,000,000 in interest that I would pay on it, is not fucking worth it. All I do is drive to work and back. Why do I need a $30k vehicle to do that?
For those of you looking into purchasing your next vehicle, ask yourself WHY you want to spend that much money, just to drive yourself to a job where you are going to work for years to pay off that exact same vehicle…sounds kind of stupid, right? And please don’t get me wrong, I’m not calling you stupid. I’m just calling your decisions stupid. Sorry not sorry.
Before I was introduced to “financial independence”, I, too, went out and financed a vehicle. It was 3 years old with 26k miles on it. I financed $13k. I knew I only wanted to spend $200/month on a car payment, so I only looked at vehicles within that realm. In hindsight, I would much rather have saved and bought a car outright that would have lasted me just as long. But I had to look cool. I had to have a nice car. But since I found FI, that car is paid off. Moving forward, I don’t think I will ever finance a car ever again. They are a depreciating ‘asset’. Once you drive that vehicle off that lot, it immediately starts to lose value. 5 years later, and my vehicle is only worth about $4k…
My advice for anyone looking to finance a vehicle: save up a couple grand and pay cash for a used one! Trust me, having ANOTHER bill every month is no fun. But, if you are dead set on financing a vehicle, go for it. This is your journey! Since I’m all about a balance between frugality and fun, why don’t you look for one around the $10k range instead? There are A LOT of nice looking quality vehicles at that price point. And I bet you’ll look way cooler than the dude that is riding his bike to work…
Speaking of, I totally just bought a bike! Hello exercise and gas savings. I’m not about biking to work with where I live currently, but one day I would totally be down with that if I lived closer to work.
Back to the vehicles. Do not forget to factor in your car insurance when purchasing a new vehicle. Chances are, if you are buying a nicer financed vehicle, you will be paying more money for car insurance. Figure out how much money per month you can devote to a vehicle, and make sure that accounts for your insurance and other vehicle related expenses, as well.
While we’re on car insurance, when is the last time you shopped around for car insurance? It literally will take you an hour of your life to fill out some questions online for free quotes from various companies. An hour of my life saved me well over $100/month. Do yourself a favor and forgo that next episode on Netflix and get yourself some quotes. I personally changed from USAA to Geico and it was quick and painless. If it makes the process easier, a beer (or two) will definitely make that hour worthwhile.
And finally, gas. Stop buying the gas guzzler vehicles! You do not realize how much that will affect your monthly finances. I fucking love when I see someone driving a heavy duty pickup truck, and that same someone will NEVER use the bed of that truck. What’s the fucking point?! You’re just throwing money out the window. Get a car that is efficient on gas, and when you’re not driving to work, park it! There are plenty of things you can do on the weekends or after work that do not require you to throw money in your gas tank. To note, check to see if your local grocery store gives you fuel points for your purchases. You will be amazed how much money you can save on gas by using their gas station.
Okay buckers, there you have it. Moral of the story here is to not be a total superficial prick when looking into getting a car. Your future self will thank you. Now, go take all that money you saved when buying a cheaper car and get yourself some beer. Cheers!