Why we drive two used cars instead of one
Photo by: johnbrian
As many of my readers know, I have a large family. There are eight of us (my wife and I and 6 children). Finding a vehicle that will haul all of us together isn’t too difficult, but they are expensive. We’ve been looking since 2006 and have narrowed our choices down to either a Chevrolet Suburban or a Ford Expedition EL. There are other full-size van and SUV options, but my wife isn’t comfortable driving them and I am not comfortable with their reliability or safety ratings. Minivans, while some hold 8 people, do not do so comfortably. The Honda Odyssey and the Toyota Sienna both are 8 passenger, but with my children being older, space is tight especially when you throw in 2 car seats. For now, whenever all 8 of us have to go somewhere, we drive two cars, our 2004 Dodge Durango and our 2001 Nissan Sentra (which is paid for).
We like 2-3 year old vehicles
The problem with the Ford Expedition EL is that it’s a new model. Released in 2007, they are difficult to find used and when you do they are expensive. Chevrolet Suburbans have been around since 1936 so there are plenty out there. This would be our primary vehicle and I like to buy cars that are 2-3 years old for our primary vehicle, meaning I’m really looking for something from 2005 and newer. I also try to find something with higher than average mileage and then do a little digging to determine why the mileage is high. If it’s all highway miles, that’s okay and you can get an even better deal. Why 2-3 years old? Here are just a few reasons:
- 2-3 year old vehicle have taken a significant portion of their depreciation. The largest portion of depreciation occurs during the first year, and generally as soon as you drive it off the lot. So basically that nice shiny new car you purchased, takes a huge hit real quick due primarily to the fact you paid retail for it (plus a number of fees that cannot be recuperated). If you were to sell it or trade it in, you would only get wholesale value. Car’s generally depreciate 15-20 of their value each year. This goes even higher for SUVs like the Suburban. For the used car buyer that plans on keep a vehicle for a long time (like me), high depreciation is a good thing.
- 2-3 year old vehicles are still under warrenty. Depending on the manufacturer, they may still be covered under the bumper to bumper warrenty. Even if they aren’t, unless the mileage is really high the power train warrenty is most likely still in effect.
- Many of the “kinks” have been worked out. With any new vehicle, there are bound to be a few kinks here and there. Either problems directly with a particular vehicle due to manufacturer defects, parts the manufacturer used (like tires) or manufacturer recalls. In a 2-3 year old vehicle, many of these types of problems have already been addressed meaning potentially less maintenance cost for you.
Why we continue to drive 2 cars
So with all of this great information, why are we still driving two cars? As with anything, it boils down to making the right financial decisions. Here’s why we are still driving two vehicles whenever we go somewhere all together:
- We’re in debt – We just simply don’t feel good about buying another car right now while we have outstanding credit card and 401k loan debt. Could we afford it? Sure, but it would take a significant bite out of our debt snowball and decrease the speed at which we are paying off our debt.
- We don’t really need to go somewhere as a family very often – Now that my oldest son is a teenager, he doesn’t generally want to go to the store, mall, etc. with us and usually would rather stay home. This frees up a seat in our Dodge Durango so we can all ride together. We are finding we require two vehicles to get places less and less frequent.
- We really like our Durango – Frankly, we really like our Dodge Durango. It’s big, but not too big and it’s loaded with lots of great options(yes, it’s a Hemi)! Seriously we really do like it. We got a really great deal on it, our monthly payment is minimal and we wouldn’t be able to replace it without doubling our monthly car payment right now as we don’t have money for a significant down payment. Not something either of us want to do. We also have a great relationship with the dealership as a result of being friends with the owner.
We’re sacrificing in the short term to gain in the long term
So, it’s a bit inconvenient to drive two vehicles around town every so often, sure it uses a little more gas, and it reduces our family time a bit, but I think the minor sacrifice is worth the cost savings. We keep looking at Suburbans, and will continue to. We keep hoping to find the perfect vehicle at the perfect price and we’re being very patient. I’ve learned through my financial journey, in key to being debt free and gaining wealth is sacrifice. This is a small sacrifice to make that overall is saving us a good chunk of money.
What do you think? What would you suggest we do? I’d love to hear your thoughts, agreements or disagreements on our decision as this is a discussion my wife and I have had many many times.