Regrets, I have a few…should I sell the car?
I promise that eventually I’ll quit referring to the Nitty Gritty post. But a subject was brought up in the comments that I thought should be explored further.
The idea of selling our vehicle for a cheaper one.
I can’t say that the thought has never crossed my mind. In fact, a case of “Buyers Remorse” arrived almost immediately upon purchase, but it never fully set in, instead it comes and goes. On one hand our van (2004 Honda) is by far the nicest vehicle that either me or my wife have ever owned. The leather seats are easy to keep clean, it has a smooth ride, and the DVD system is great for long trips. On the other hand, we are paying almost 10% of our take-home income on something that just transports us from point A to point B.
What where we thinking?
It was early in the summer of 2006 and my wife and I were expecting our 2nd child. We knew it would be tough to fit two car seats and our dog in my old car (a 2000 Ford Contour), so we thought about doing the unthinkable…buying a mini-van!
Since we were given a gift subscription to Consumer Reports, we knew the highest rated Mini-Vans were made by Toyota and Honda. So on a random rainy Saturday, we drove to the lot in my Ford, and drove home in a Honda. So much for following Consumer Report’s advice!!!
Looking back I’d like to plead temporary insanity, because if I remember correctly we also bought a brand new hide-a-bed that same week. Obviously we were going to need a hide-a-bed since child #2 would be taking over the guest room. Plus it has to be a nice one because it’ll be in my wife’s office…I can count the number of times that hide-a-bed has been used on one hand.
Back to the issue at hand:
From a debt elimination standpoint, it’s a no-brainer. Kelly Blue Book says the van’s retail value is $16,800. which is about $5,000 more than we still owe on it. So we could sell it, buy a another van for probably half the price and pay off the old van debt in no time.
But I’d have to add the cost of alimony and child support to my debt because when this idea is brought up with my wife, she says it’s a deal breaker. **Note, this is an exaggeration. My wife wouldn’t leave me if I sold our van. But I do think she’d find subtle ways of torturing me little by little. Plus I’m pretty sure I’d be locked out of the sugar shack for a very, very long time.**
What to do?
Our plan is to ride out the payments (only 37 more to go), keep up on the routine maintenance and drive it forever. Or as long as we can, whichever is longer. At least that was our plan before we came upon The Happy Rock. Perhaps one of you has a better idea. I hope to get some comments on this matter, the previous one I’ve gotten have been really good.
No pressure.
Until next time,
-DD
Interest Free Payments…are they a bad idea?
Sleep Your Way To Better Finances
If you plan to sell it to reduce debt (always a good thing) and get a new car then make sure you consider all the different angles. This would include gas, insurance, selling fees, time spent selling and searching for a new car. The other thing is reliability. You already know what to expect from your current van, but it is difficult to assess when purchasing a used car….Just my 2 cents.
It also depends on whether on what the final selling price is for the van. If it end up being sold for a lot less, then it would not make much sense to sell it. Further more, how would an older car impact on your lifestyle? I don’t mean from a luxury perspective, I mean can you depend on it to be a reliable car. Anyhow, just a few thoughts.
Personally I’d sell the van, and buy a cheaper reliable van, and use the difference to pay off debt. Then you can start saving for your next vehicle that might be a bit nicer. I would try Dave Ramsey’s Drive Free Cars and retire rich plan – google it!
Yep, ditch the van for something more economical. Little, less fuel consuming cars are getting more expensive though because of the demand due to fuel price hikes.
It’s going to end up being Car Repayments VS Fuel Costs.
I would stick with the current van and pay down the debt more quickly with extra payments. My car loan on a 2005 would be complete in 2010 but we made extra payments so we could move on with life.
Good luck.
Maybe instead of looking for a way to get rid of this mini-van debt, look for a way to cut other things out to have a bit more money to pay it off?? (snow-ball effect)
When my husband and I were in a simular situation (I’m the one with the 4 kids), this is what I did:
I set out all our bills in front of me. I started with the most expensive one and thought, “O.K., how can I make this one smaller?” then I did the same with the next one. This is what I came up with: Mortgage: at the time, I could not make it smaller. Next biggest: auto gas-so I drove less. I have consulidated all my trips to town(20 miles to a larger one). I make menues out for the whole month. We run out of milk and frest fruit mostly, so my husband picks it up on the way home from his first job. Next came propane for heat, so my husband and I are using our “stimulus check from the gov’t” to purchase a woodburning furnace for the winter. that will save us money on propane. I have now gone from filling up my gas tank once a week (at about $70) to once every 2 weeks. With the extra savings we are now able to make extra house payments. that’s just one way that we’ve saved money. Maybe you guys could do something like that and put extra money toward your van payment?
Yes, this has taken a lot of disciplin but we’re still on my husbands dream farm (raising our own food) and I’m still able to stay at home and raise our children.
Thanks again for all the great comments. You guys are the best!!!
@nick – Those are all great things to keep in mind if we decide to sell the van.
@tehnyit – Good point about the final selling price.
@Pete – Thanks for the tip, it sounds interesting. I’ll be checking that out very soon.
@Drew – if we choose to sell we’d probably stick with a van, just a cheaper one.
@Sue – Yeah, that was my initial thought as well. And I now my wife would agree with you 🙂
@Jacquelin – Thank you for commenting, it was very inspirational. Hopefully you get to keep living the dream. And with good discipline, I don’t see why you won’t.
I think you have a nice idea to sell the vehical. Very nice post. Thanks
DD
When I read your Nitty Gritty post my first thought was the car must go. Sell it, pay off the loan and buy another van for about half the cost for cash. That would free up $330 monthly for other expenses/debt reduction. 37 months can be a long time.
However, if your wife is not 100% on board with the idea, then it should not happen.
Have you asked her why she doesn’t want to sell the van? Is it because she is concerned for the children’s safety and comfort? Is it because she likes to have the van parked in the driveway as a symbol that you are financially successful? Is there some other reason?
In my mind the answers to the above questions will decide if you keep the van or convince her that it really needs to go along with the debt.
That’s my 2 cents worth. I’ve enjoyed reading your posts. Thanks.