My wife and I have two aging cars. My car is nearing the 220k mile mark (Saturns apparently run forever) and her car has logged just over 160k miles. Our plan? Drive them until they die or need a major repair that wouldn’t be worth paying for.
Unfortunately I’m not sure how much longer my car is going to last so it’s definitely time to start thinking about what we want in our next car. There’s a few different routes we could go ranging from spending only a couple thousand on another old car to buying a brand new car with all the bells and whistles.
Deciding on how much to spend on a new car is never easy, nor is picking out the specific make/model. Today I won’t go into detail about which brand is better or worse, but instead talk about three factors that we are taking into consideration when buying our next car.
Cost
As with most things cost is one of the most important factors when it comes to deciding which car to purchase. You can spend as much or as little as you want on a new car. The last car I bought – which I’m still driving – was a 2001 Saturn L200 with just under 110k miles. A big reason I went with this car is because I was able to find it for $5,000. I was lucky enough to pay for this car in cold hard cash and have never had a car payment.
One reason most people hate to buy a car is simple: they’re expensive. While I was able to find a decent car for $5,000, you’d be hard pressed to find cars with under 100k miles on them for less than $5 or $6 thousand. There’s a few reasons why it sucks to buy cars with over 100k miles on them:
- You don’t know how good/bad the previous owner took care of the car
- You don’t know how many repairs you are going to have to pay for as parts start to have issues and need replacing
- There’s typically no longer a warranty
While there are negatives that come with buying an older car, there are also positives. You are much more likely to be able to pay cash if you purchase a less expensive car. You also may get lucky and will need minimal repairs. If you can spend less on your vehicle and avoid having to make car payments you should have some extra cash flow you can put towards savings, retirement, debt, etc.
Size
My wife and I both drive 4-door sedans right now, but what we’d really like to get a small SUV for our next vehicle. The problem is that it’s pretty difficult to find a lower-mileage SUV for under $10,000. Yes, I realize that some SUVs can be a bit pricey for most people, but even the less-expensive brands are going to run for around $15k or so if you are looking for vehicles under 100k miles. On the flip side if you are shopping for 4-door sedans you are likely going to get more for your money as far as mileage and manufactured year is concerned.
While it was my wife’s idea and not mine to get a small SUV for our next car, I can’t help but think how much easier some things will be with a bigger vehicle. One time we bought lawn furniture only to realize there is no possible way to get it to fit in my car. We had to go back in and return it. Other times we’ve had to pay for shipping or try to find companies that offer free shipping on large items because we simply can’t move them ourselves. We have made this work for some time, it would be nice to have a vehicle that has more storage space for hauling. Additionally a small SUV could easily have a trailer hooked up to it which makes it really easy to haul things (as I’ve witnessed from my neighbor’s jeep + trailer setup).
Reliability
I touched on this briefly when discussing cost, but reliability is a huge factor for us. My wife’s car has had countless repairs and issues. While my car hasn’t had quite as many problems, I still have to keep in mind that any given day this car could have some major issue that will force us to purchase a new vehicle. Just on Friday I had a problem where my car wouldn’t shift from neutral to first gear, and in the past I had issues going from first to second gear among other issues. It’s not fun knowing neither of your cars are reliable.
A second factor is that we live in Minnesota where snow and ice on the road are things we have to deal with for about six months out of the year, sometimes longer. My wife hates driving in the snow and having an SUV with AWD and snow tires would really help her anxiety. Beyond that, having a car that is newer and possibly even under warranty would make me feel better from a financial standpoint as well as the re-assurance that we have at least ONE vehicle under our roof that is reliable.
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I realize there are many variables that come into play when deciding how much to spend on a car and what type of car to get. For us, though, these are the three most important factors we will take into consideration when purchasing our next car.
And hey, if you have to purchase a new car and are frustrated about how expensive they are, just be happy you don’t have to pay $500 a month to rent an old car like Cat did! #Perspective
What do you consider when you are looking for a new car? Are you in the same boat as us and need one soon? If you just bought one recently, what was the most important consideration?
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We are in the same boat as you guys, DC. Both of our cars are older with high miles and may or may not need to be replaced soon. But we have the same philosophy; we are driving them until there is something major that needs to be replaced/fixed and we don’t want to spend the money on it. It’s really hard to think about parting with cash for a new one or, alternatively, going back to having car payments. We don’t really want to do either, which is why we are keeping the crappy cars for now!
colormefrugal Haha we think exactly the same! I like having the cash in my savings account and the alternative – car payments – is not attractive either. I hope I can make it to next Fall without having to purchase one.
220,000 miles? Wow, that’s impressive. We’ve purchased 2 cards over the last two years. I really really hope we are done car shopping for many years. I agree with what you say about the convenience of getting a larger vehicle. We purchased a Honda CR-V and we love knowing that we have a ton of space to haul stuff if needed. Before we just had tiny cars so anytime we needed something big we either had to get delivery or sometimes my generous parents would lend us their larger vehicle to use.
BudgetforMore Nice, hopefully you don’t have to shop for another car for a long time. I have had to rely on my Dad and others for a few years now and would love to get a bigger vehicle to haul stuff. I think we will almost for sure get a Ford Escape for our next vehicle.
We aren’t car people so we mainly focus on price and reliability. We don’t want to pay a lot for the car itself or for repairs =)
Holly at ClubThrifty I’m not a car person either! I’m looking for a practical and reliable car for our next purchase. I have zero DIY experience with cars so the more reliable the better.
The biggest factors for me would be reliability, mileage and of course a good, not necessarily cheap, price. Most Japanese cars fit the bill nicely.
BTW, awesome job on putting on such high miles on your cars!
moneycone Thanks, I’m really thankful to have had a car that’s gone to 220k *knock on wood*. I hope I can get another 10-20k miles out of it, but we’ll see.
My car has about 240k miles on it so you and I are in the same boat. Reliability is up there on my needs as well. Nothing is worse than running late and then having your car die on you.
DebtandtheGirl Very nice, I hope I can hit the 240k mark before having to purchase a new one. My wife will drive the new car and I’ll drive her older one, but having at least one reliable car should be a huge stress reliever for us.
We were willing to pay more for a car with fewer miles simply because we didn’t want to take the risk of buying a lemon. Neither of us are good enough with cars to truly evaluate whether a higher-mileage car was in good condition. But if you are, that can be a great way to save money.
Matt @ Mom and Dad Money I think I’ll do the same, as I also am essentially gambling when I buy a higher mileage car. I have little auto knowledge, though I could bring one of my friends with to evaluate the car. I brought a friend with on the last one and had my Dad look it over and I thankfully had few problems the past five years.
You can put a trailer on a sedan and tow light things. I hauled a 4×8 uhaul trailer across the country in my Corolla. I did drive pretty slow on anything other than flat ground, but I managed to do 60-70 just fine across North Dakota. Montana took forever.
We also live in Minnesota. I’m not convinced a small SUV is the best choice for our weather. Certainly, a car that handles snow well is important, but you can find that in any variety of cars. Knowing how to handle the car well also helps.
If you want an SUV, go for it. But know that there are work arounds, especially if you want to save some money. For my part, I prefer to pay more for my car but get something with much lower miles. I’ve had my Corolla for 9 years and 120k miles, and I credit part of that to buying a 1 year old car with 26k on it and then finding ways to drive less.
lapenn Thanks for the advice, and always good to hear from another Minnesotan! I honestly would only need a small trailer so if a sedan can handle what I’m hauling it could still work.
These are definitely important factors to consider. I have a two door right now, and it can sometimes be inconvenient when trying to pack for a trip or fit additional people in the back. We both have cars and have no problems with that, but an SUV would come in handy down the road if we ever decided to buy things at a garage sale, or fix up our future house. Reliability is probably the biggest thing. Knowing that your car will make it from point a to point b without any issues is nice!
JourneytoSaving I think buying a house has really made us want to get an SUV. We will likely get a large dog sometime soon here so that would help if we ever went on a longer trip and had the dog along for the ride. Ditto on the garage sale purchases. I would love to be able to find some furniture from garage sales to fix up.
We consider if the vehicle will still meet our needs in 5 years and 10 years. In 2012 we bought a new car with the intention of driving it for 10 years, so for now it needs to be the “little” car, compared to our truck, however when we replace the truck my spouse wants to get a sports car. So, the little car will eventually be the big car and need to be able to hold things like skis and camping gear. This is all predicated on living in the city by then. If we don’t, we’ll possibly move to a 3 vehicle *gasp* household that just kept driving the truck to the ground.
Ugifter Thanks for sharing! I would like our next car to last 10 years so low mileage is essential. A 3 car household? WHAT! just kidding, sometimes it’s justified.
First of all, I am shocked and impressed on how much mileage you got out of your current cars! I always tell people to let your car tell you when you need a new car. If you have a car that is almost ready to go and you need $2,000+ work on it for some reason, then your car is telling you you need a new car. I have only purchased certified pre-owned cars if I purchased used cars in the past, because I feel like you can never be sure what is lurking in your “new” used car.
blonde_finance I think at this point even a $500 repair would make me think about purchasing a new car. It’s hard to justify putting anything more than a couple hundred dollars into my current car, though I do find a lot of value in putting off that next car purchase because I know it will be a big negative on our personal income statement.
I’m so impressed that you were able to put 220k miles on your Saturn. I owned a Saturn in the past but never put that much mileage on it. For me the #1 factor is reliability. For now we’re good with our current vehicles but I have considered an SUV for the future after the winter we’ve had here.
Raquel@Practical Cents My parents had a Saturn previously that they gave to the “kids” and we got to about 208k before it needed some major repair. I feel like if you experience rough winters you really do need to consider getting a better vehicle if you have the opportunity to.
One thing I look for is availability and cost of parts. I know that for Saturn, there is going to be a point where it is hard to find parts since they are no longer around. While this will be some time in the future, that is always a concern of mine. I also just look at overall cost of repairs. Foreign cars tend to cost more to repair than domestic.
DebtRoundUp Great point, and one that I didn’t factor in. You’re right about the Saturn parts. I even considered buying another Saturn, a cheap one, as they seem to have a limited number of repairs. I did not think about how the parts will be harder to come by. My friend had a Jetta and his repairs were always twice as expensive as comparable cars made in the US.
DC @ Young Adult Money I only say it because my brother is a mechanic and he said that is typically what happens when a car stops being made. You can get parts, but over time it gets harder and more expensive.
DebtRoundUp DC @ Young Adult Money Good to know! Will take this into consideration when looking at cars.
I think we have reached the “drive it till it dies” point with our cars as well. Like many people, I get tired of a car a car after driving it for 3-4 years.. But that certainly isn’t a good enough reason to take on another $500/month worth of payments!
seedebtrun I agree! No reason to take on an additional payment when you can keep driving the same car year-after-year.
I have a company vehicle and my wife’s car is paid for. We want an SUV when se have kids, depending on interest rates if I finance or pay cash. It needs to be used within five years, have you considered one of those preowned certified ones from a dealer?
Charles@gettingarichlife Oh nice, a company vehicle definitely would cut down on costs. I have not looked into certified pre-owned vehicles, but from what some other commenters have said, it could be a good choice.
We have been a hot debate about this all winter, even though we are about 5 years out from buying a new car. My husband wants to get a smaller sized SUV because winters in Chicago are just horrible and we have a ton of issues with our car getting stuck in snow piles. I, on the other hand, want to stick to a car and use the saved money to pay for covered parking. We’ll see who wins this one…
fitisthenewpoor Haha oh boy this sounds like quite the debate! Covered parking shouldn’t be underestimated. I know it’s made a huge difference for me the past two winters.
Reliability is probably at the top of our list, since the initial cost of a vehicle can pale in comparison to the ongoing costs, if you get unlucky. We are big hatchback/wagon fans, so that ended up being a limiting factor, too.
I can definitely see the merits of a small SUV in Minnesota. Though you might be able to get away with smaller/more fuel efficient options + snow tires.
DonebyForty Good point about the more fuel efficient options + snow tires. It wouldn’t be a bad way to go and it would serve the same purpose of helping us drive through some difficult weather.
Reliability and safety are my chief concerns. I drive a 4 door sedan and Chris has an SUV. I will say beyond the Minnesota winter consideration, which is very valid by itself, it is also nice having an SUV with kids. I don’t know if that is something you guys are planning anytime in the near future, but it does make road trips easier when we have more room. :)
ShannonRyan Well, there is no plan for kids for at least 5+ years, but I know there is always a risk haha – that sounds so terrible. We do plan on getting a bigger dog within the next six months so it’ll give us a bit more room if we have an SUV versus a sedan.
Hey DC, I was a big believer in buying older cars and only recently switched to new cars. I don’t like the way they depreciate but like you said, you never know how the previous driver treated it. On top of that, I was recently rear-ended in my last car (second-hand) and insurance would only cover part of the loan for it because it had previous hail damage. So we were stuck with $4000 on the loan. :(
Anyway, I will always buy new and just drive it until it dies. The depreciation thing doesn’t really factor in if I’m going to drive into the ground.
Lindsey at Sense Not bad logic, in my opinion. Once you can afford the payments or afford to pay for a new car with cash, it does have it’s benefits.
DC @ Young Adult Money Lindsey at Sense Second hand cars are the way to go but we just have such bad luck with them, it just turned into a game of how to reduce the risk as much as possible. But I think your approach would work best in 98% circumstances. :)
Lindsey at Sense DC @ Young Adult Money It’s the 2% chance that worries me!
I went to Edmunds.com and watched an awesome video on negotiating my car’s price. I was able to wallop $4k off the price of our car immediately before talking to anyone. That was my favorite consideration.
AverageJoeMoney Hold up, do you have a blog post on this? I’m very interested in hearing more.
Definitely all important factors that I’ll be considering. Since we have a growing family, I might look into minivans or SUVs. I might go with a minivan since it’s more practical for a family. A lot of people don’t like them because they’re not cool…but that doesn’t bother me!
Andrew LivingRichCheaply My friends are going to go with the minivan as well! We had one growing up and it was great…until we were teenagers.
A while back I was shopping for a car for my wife that would be under 10k with under 100k miles and it was very difficult to find a decent car . Reliability is always top of my considerations and then cost.I think if you can afford the payments comfortably including the insurance, then a new car would be much better. However, I still don’t think I would buy a brand new car due to depreciation. I would be fine getting a car with around 20k miles.
BorrowedCents I was looking at some nice cars today with about 20-40k miles on them. I think that’s the way to go, as you can save ~$5k from the get-go by getting a newer used car.
Reliability and warranty are big items with my wife….any time one of our cars has anything go wrong with it, it’s like the world is collapsing around us. LOL. She feels better when it’s under warranty – and it’s nearly impossible to explain to her that repairs on a paid off vehicle are almost always cheaper than the payment on a new vehicle. She just likes the peace of mind that we won’t have an unbudgeted expenditure I guess. :)
Last year I bought 97 honda civic with 125k miles on it. It was serviced regularly, well taken care of, and was a great buy. It gets 40 mpg and saves me a lot of money as I now rarely drive my big truck. smart deals can be found on older vehicles you just have to be willing to do the research and spend the time looking for them.
I am on my way to Orlando to buy a car :). Going with a dealer friend at dealer auctions so prices could be good. I want reliable brands and well known models so it is easy to find parts anywhere. A cheap price for a brand nobody knows how to fix means problem.
4 or all-wheel drive is such a blessing in these harsh MN winters, DC. Rick doesn’t have it on his commuter car, but it’s nice knowing we’ve got it on our SUV, and makes life much more bearable when you’re driving through a storm or snowy roads. I know what you’re saying about buying used too – it’s scary not knowing what the real story is behind a vehicle.
I never gave it a ton of thought until my last Nissan because I knew I was done with new cars and trade ins every three or four years. For this last one, I wanted something reliable that got good gas mileage, plus I know this is not a need, but I really, really like heated seats. I am always cold, especially in cars, so that makes my life much better. We also have a 4WD truck. After going for several years with small cars only, I can say that it makes life in a place with snow a million times better, plus you don’t have to rent or borrow a vehicle when you need to haul something.
Cars are rough, DC. I’m driving our old car until the wheels fall off, but I like having something safe and that gets great mpg. Unfortunately, like you said, they can’t be had for cheap. I’ve really come around to the line of thinking that our next car will be a couple of years old. We’re the types where I know we’re going to have it for a long time, so I can get peace of mind in addition to not paying a premium for a new off the lot car.
I drive all my cars for a long long time, until they start nickel and diming me. So, I sold my Dodge Intrepid and I bought a 3 year old Honda CRV. It was really a toss up between a Toyota Rav 4 and the Honda but I wanted a door in the back that opened up rather than out, so I could open it with the garage door closed.
i noticed that there were alot of cars available because the three year leases expire, so there was alot of competition. Most of my choices were the same price but not all were in the same condition. I waited and found one for $1500.00 less then the others and in great shape.
I spent over $10,000 but I plan on having this car for 15 years. I also pay for everything with cash but this time I sensed I should finance part of it and luckily I did because 6 months later I was laid off from a job of 13 years. It took me 9 months to find another job.
I am very happy with my choice. I love having a small SUV that still gets good gas mileage.