Stressed over the car

lifeonthehill · March 2014

This is just me venting.The car had been violently shaking the last two times we took it out. Fortunately we really only need to use it once or twice a month. H needed to go to his home town for a family hockey tournoment this weekend. On the way home he blew a tire and now has to get it towed back, a new tire, new rim and obviously whatever the shaking was needs to be looked into ASAP. We were set to pay off another SL Thursday but obviously not now.
We agreed on the phone tonight that if it is going to cost over $1,500 to fix not including the tow we need to get rid of the car and get something newer. We have no money saved for a new car because we SWORE we were going to get another 12 months out of it. I am really stressed that we aren't better prepared for this and now we are looking at a car loan on top of our SL debt. We have been lucky to have 11 months of sever snowballing with no interruption so I am not taking this well.
Murphy's Law in effect. Just like Dave Ramsey warned me about! Haha.

vlagrl29 · March 2014

Hopefully it doesn't cost that much and you don't have to buy a new car. I would love to pay cash for our next car but I don't even see that happening.

hoffse · March 2014

That sucks - but sometimes fate pushes your hand one way or the other. Try to focus on the fact that a newer car probably means a safer car as well. At the end of the day, your life and safety in that vehicle are a lot more important than maxing out the debt snowball.

The good news is that interest rates are dirt cheap for car loans right now (or they were a month ago when we bough H's new car). I think H and I will be paying less than $200 in interest over the life of our loan for a brand new car. Amortized over 3 years, that's such cheap money that we actually borrowed more than we had to in order to avoid draining our savings too much. Obviously that's not the choice many on these boards would make, but we've found the car payment pretty easy, and it has allowed us to keep our e-fund and other savings funds intact.

If you can get a low-interest loan for 3 years or less that's comfortable, you will be done with the car payment in no time.

hoffse · March 2014

Oh and I know next to nothing about cars, but I do know that you should drive them at least once a week to keep everything working right. Otherwise stuff can clog (or so my car-crazy friends tell me). Might underuse be an issue here?

lifeonthehill · March 2014

Thanks ladies. I know that safety is the real concern here I am just not ready to break into my e fund for something I could have planned for. It is good to know loans are low interest now but we really both wanted cash for a used car. Haha. Things are not going according to plan.

We do drive the car once a week right now we just don't have to. So at least if we had to go carless for awhile we could find other ways around for a few weeks.

H just called to say the tow truck is on its way out to get it. I guess we will know the damage in a few hours. Hopefully It is going to cost much less than we are predicting and we wont have any other issues!

KatieCutie05 · March 2014

Whats the point in paying off debt if your just going to sign up for more.... Dave Ramsey doesn't warn you against murphy - he warns you against car loans. Buy another beater. Especially with the little amount you drive it.

But regardless whatever you do, don't buy a new car. They are the biggest money suckers. I bought a new 2011 car 3 years ago for 22k - financed at 360 per month. Now 3 years later and its worth 10 or 11k tops. I'd be lucky to get back what i owe on it. I lost 12k in 3 years plus interest is 13k. Don't buy a car any newer then 2 years old. New cars lose 60% of their value in the first 4 years. a year ago my car was worth not much more then its worth now so you lose value slower after 2 years. Never making that mistake again. Oh yea and my husbands car we bought used with 20k miles on it - 2 years old. We paid 14k and the exact same new one was going for 22k dollars. 20k miles is not worth 8k dollars no matter how you pay for it.

brij2006 · March 2014

I'm going to agree with Katie. Don't go into more debt. What's the point in focusing on paying off student loans, just to take out a car loan?

Either pay to fix this car or buy another beater until the SL debt is gone and you can save up to buy a newer car.

cbee817 · March 2014

brij2006 said:

I'm going to agree with Katie. Don't go into more debt. What's the point in focusing on paying off student loans, just to take out a car loan?

Either pay to fix this car or buy another beater until the SL debt is gone and you can save up to buy a newer car.

I disagree with this- they want to TTC in less than a year. Get a car that's reliable and safe for you and your future family. You'll need to go to the doctor's a lot when you're pregnant and the first year for your LO. From what I remember, you guys are in good financial shape.. sure it's a set back, but sometimes things like that happen. GL with whatever you decide!

Xstatic3333 · March 2014

That does suck. We went through that with H (then FI's) car two years ago. There were several incidents a few months apart where we had to do $600 repairs to it. We reallllyyyy wanted it to last one more year so we could get through our wedding and some old credit mistakes would drop off of H's report. Well, fate had other plans. When a $1,000 repair came up I put my foot down.

We ended up financing a $10,000 used Subaru (5 year loan, but now it will be paid in 3.5). The $2,000 DP is what would have been our honeymoon to Iceland. I don't know if we'd do it this way again. It's already had some hefty repairs, despite being a good car in general. But H got a better job offer with a longer commute, and he had to take it. I will say it could have been worse if I hadn't really put my foot down on our payments being $200 or less a month.

If I were you guys I'd probably do something you could finance for three years or less. You've mentioned TTC soon; that will probably involve Dr. appointments, playgroups, etc., and you'll want something safe for your LO. For that reason I wouldn't do a total beater. Plus, you guys rock at paying down debt so if you take out a 3 year loan I bet it's gone in 1.5. If you can get a decent used car and still have e-fund left, then by all means pay cash!

That said, as you all know I'm not a DR follower. His advice would be what Bri and Katie mentioned. Either way, good luck! I think not fixing it if it's over $1,500 is a good call no matter what you pick for your next car.

maple2 · March 2014

I have had really good experiences buying used cars from private sellers. I have pretty much always payed cash for my cars, and as a result the cars have reflected where I was in my life. My first car out of college probably cost $2,000. It didn't have power anything or AC, but it was a relatively low mileage older Toyota that I got checked out by a trusted repair shop before buying. It lasted me almost 10 years (for better or worse). Once I got a professional job, it was a bit funny to be driving everywhere in my tiny old car with the windows down, but the trade-offs were worth it to me since I didn't have to go into debt. In your situation, with a car that is not used regularly, I would definitely just buy an inexpensive used car rather than taking out debt. Then start saving for the new car you want.

brij2006 · March 2014

cbee817 said:

brij2006 said:

I'm going to agree with Katie. Don't go into more debt. What's the point in focusing on paying off student loans, just to take out a car loan?

Either pay to fix this car or buy another beater until the SL debt is gone and you can save up to buy a newer car.

I disagree with this- they want to TTC in less than a year. Get a car that's reliable and safe for you and your future family. You'll need to go to the doctor's a lot when you're pregnant and the first year for your LO. From what I remember, you guys are in good financial shape.. sure it's a set back, but sometimes things like that happen. GL with whatever you decide!

There are some safe beaters out there. You can easily get a Buick Lesabre for under $5k. Those run forever, have amazing safety ratings, and an engine that isn't overly complicated so doesn't have costly repairs. There's also anything from Honda or Toyota that usually has good safety ratings. She also stated that it is only used once or twice a month. That makes a huge difference when it comes to having a car payment on a vehicle that is barely used.

Yes, safety is important. I'm not saying at all that safety isn't. But do your research on cars. There are many out there that are "safe" that don't involve $15k in debt and a $300/month payment.

Also, if the student loan debt will be paid off before TTC, then why not focus on building the Efund, then savings for a newer car while TTC. Then you could purchase a better/safer/newer car at that time with cash.

Yes at the time $1,500 sounds like a lot in car repairs. But $1,500 split up over the course of 12 months is $125/month. That's still cheaper than a car payment on a vehicle that is only used twice a month. Instead do this math....if you buy a car with a payment of $200/month to only use it 2 times in a month. Then it costs you $100 each time you drive that car. On top of the regular maintenance, gas, and the added expense of full coverage insurance because it has a loan.

Xstatic3333 · March 2014

I see what's going on here-different definitions of beaters! I wouldn't consider a $5,000 2005 Corolla a beater. Good points on safe and affordable not being mutually exclusive, @brij2006. When I hear beater I'm think $2,000 or less and think of H's old car that was held together by prayers for the whole last year. Personally I don't mind my car payment-it's $140 a month, and I had over half of the car's value down. $300+ a month and mostly financed would bug me big time.

Alyssa, any news yet?

lifeonthehill · March 2014

KatieCutie05 said:

Whats the point in paying off debt if your just going to sign up for more.... Dave Ramsey doesn't warn you against murphy - he warns you against car loans. Buy another beater. Especially with the little amount you drive it.

But regardless whatever you do, don't buy a new car.

I would never buy a brand new car. That is stupid. But yes we would need a car loan to get a beater car.

Dave Ramsey does warn about Murphy's Law in his book. He claims by being prepared it wont be as big of a deal when something happens and he thinks it prevents it(which I disagree with).

lifeonthehill · March 2014

cbee817 said:

brij2006 said:

I'm going to agree with Katie. Don't go into more debt. What's the point in focusing on paying off student loans, just to take out a car loan?

Either pay to fix this car or buy another beater until the SL debt is gone and you can save up to buy a newer car.

I disagree with this- they want to TTC in less than a year. Get a car that's reliable and safe for you and your future family. You'll need to go to the doctor's a lot when you're pregnant and the first year for your LO. From what I remember, you guys are in good financial shape.. sure it's a set back, but sometimes things like that happen. GL with whatever you decide!

Exactly this. We want a reliable car in 24 months so I see no point in buy a horrible car to have the same issues and then turn around and need something nicer. We would never buy brand new and we would try and get something with high miles since we don't drive often but that is still going to force us into a car loan.

lifeonthehill · March 2014

Xstatic3333 said:

I see what's going on here-different definitions of beaters! I wouldn't consider a $5,000 2005 Corolla a beater. Good points on safe and affordable not being mutually exclusive, @brij2006. When I hear beater I'm think $2,000 or less and think of H's old car that was held together by prayers for the whole last year. Personally I don't mind my car payment-it's $140 a month, and I had over half of the car's value down. $300+ a month and mostly financed would bug me big time.

Alyssa, any news yet?

I agree about the beater! A 5000 dollar car is in no way a beater to me! 2,500 is. No news yet. H is waiting for a mechanic to have a look now and hopefully it will be good. They warned him it could be $200 or $2000 so we will have to wait and see.

lifeonthehill · March 2014

UPDATE! He just called to say it was $225 for the whole job and the mechanic even drove it around a bit to make sure it wouldn't shake on acceleration before H had to take it out on the road! As always I worried for nothing. Now we need to start a car fund so we can save at least a good down payment for a used car before something like this happens again. Thanks for listening to my ranting.

vlagrl29 · March 2014

I'm so happy it wasn't very expensive. In an ideal world none of us would ever have to go into debt and pay cash for everything, but it's just not realistic. If something happened to your car and you needed a used car you would need to finance it if you didn't have the funds. As long as you are smart about paying it off is all that matters which it seems you are.

goldiemu · June 2014

I know enough about cars given I have always bought used cars and had to learn how to do some of the work myself which was easier on older cars, not so much now.

I always buy used cars from private sellers and have had amazing luck. I would never buy a new car because I have saved so much buying one that is about 3 years old with no more than 20,000 miles.

I had the same questions so I wrote an article about the true cost to own a car. It turns out Edmunds.com did this study which outlines all of it. I thought it was very helpful especially since I don't know how to calculate depreciation.

Stressed over the car

Re: Stressed over the car

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