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Clunker bait - car dilemma?
Old 07-28-2009, 11:28 AM   #1
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Clunker bait - car dilemma?

OK - I could use some perspective....

The cash for clunkers program has my interest peaked and I am thinking of taking back some of my tax dollars via this program. But is this a good financial choice?

I have a qualifying vehicle - 1999 Ford Exploder with 66,000 miles.
The Kelly private sale value is $2500 and I bought this heap new (stick shift, crank windows, no center console, plastic seats) and paid cash at the time.

Usually I keep cars forever and with this mileage would expect another 5-7 years of use but I HATE this car and given the number of plastic bits that have begun snapping off it, don't believe that it will be on the road for many more years. Currently, there is nothing wrong with the car mechanically and I would be buying a similar vehicle. I need to be able to tow 5,000 lbs and carry heavy, lumpy gear. I can find an SUV with better fuel stats though that would still qualify under the clunker program.

Should I take the $4500 now or suck it up and drive this low rent rig until it dies?

Am I over thinking this?
  • It seems fundamentally wasteful to me to trash a perfectly drivable vehicle.
  • This is the only time I'll ever see 4500.00 for this car
  • The fuel mileage rots (just under 17 mpg)
  • New car would only get a little better fuel mileage
  • I am cheap and opening my check book causes me heartburn
  • I love the smell of new car
  • Insurance would go up
  • Repair costs would go down
  • I would have to interact with car sales 'professionals'
  • That could be good sport...
What do you think?
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Old 07-28-2009, 11:43 AM   #2
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All I can say is that I'm regretfully doing the same with my 147,000 mile 1988 Mazda RX7, owned from new. My rationalization is that I'll have the new car for at least another 10 years, maybe 20, as with the RX7. And there's no way the Mazda is going to last that long, so I'm in for a new car anyway at some point in the near future.

But I'm 'holding my nose' as I do it.

Peter
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Old 07-28-2009, 11:44 AM   #3
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Keep the money, drive it 'till the end. Besides, not likely to be stolen.

I think you could have fun spending lots of money in venues that do not include sparring with salesmen.
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Old 07-28-2009, 12:07 PM   #4
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Life's too short to plan on spending years owning a vehicle you hate. Take advantage of this golden opportunity.

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Old 07-28-2009, 12:26 PM   #5
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Obviously there's no clear answer. More questions for consideratoon:
- Does it make sense to spend $25,000 now (new vehicle price) to get this $2000 in "free" cash (difference between market value and CFC check)?
- How much time do you spend in the vehicle? If you are driving it only 10 hours/month hauling stuff, then the $$/hour for this splurge on a new vehicle works out to be very expensive. You could probably find other uses for the cash that would bring more enjoyment.
- Depreciation will be a lot on the new vehicle. Even if you plan to drive your vehicles for a long time, depreciation can be a factor: If your present ride lasts another 5 years, you could then buy a used version of whatever you are thinking of buying right now for much less $$.

I think you already know the right answer from a financial standpoint. But if other issues outweigh the $$ aspect, then just do the math so you know how much the splurge is gonna cost you, figure out if this is the best enjoyment per dollar, then jump in if you still think it's a good idea.

- Re: Heavy, lumpy gear: Would a utility trailer help? I love my small trailer--I can haul 1200 lbs of anything with my 4 cyl mini-minivan, it is easier to load than a truck, and I don't have to worry about scratching it up. You'd still need a big/heavy vehicle to pull the loads you want, but maybe a trailer would give you some flexibility regarding vehicle configuration (e.g. maybe you could get something with more passenger volume, or smaller overall if you used a trailer for the hauling of bulky stuff.)
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Old 07-28-2009, 12:50 PM   #6
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If I hated my car I would go for it . Besides the cash for clunkers the deals are great right now and you can deduct the sales tax on your income tax . I only ever had one car I did not like . It was a Nissan station wagon . Great car but I never felt like I was the station wagon type so I traded it for a GEO Storm which was much more fun .
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Old 07-28-2009, 01:04 PM   #7
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Well it looks like CFC is going to get at least two old cars off the road.
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Old 07-28-2009, 01:10 PM   #8
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Janet, if you can afford it then I vote for you to get a new vehicle!! You really seem to want one and dislike the one that you have. That is good enough justification, it seems to me. The $4500 will be nice to have as well.
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Old 07-28-2009, 01:23 PM   #9
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Janet, here are two ironclad factors you didn't include in your pros and cons above:

- If you keep your old vehicle it will shortly begin running up major repair bills.
- If you go for the new ride, your old vehicle would have continued to give you years of reliable service.



Bottom line, you can't win. Do what you want to do and don't look back...
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Old 07-28-2009, 02:10 PM   #10
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Originally Posted by Janet H View Post
The cash for clunkers program has my interest peaked and I am thinking of taking back some of my tax dollars via this program. But is this a good financial choice?
Bear in mind that a few car companies are offering fairly sizeable cash allowances in addition to the government program to entice buyers into dealerships as well (depending on the region, Chrysler is offering up to $5K off in addition to the Cash for Clunkers). And, you'll also be able to deduct any taxes that you pay on the new car from your federal income taxes regardless of whether you itemize (Special Tax Break Available for New Car Purchases This Year).

With all of the "free" money out there, it might be a good time to reset the clock on your vehicle (especially if you don't like it).
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Old 07-28-2009, 02:12 PM   #11
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I haven't done much research on this since in Canada I believe they give about $300.00 which is actually a joke but........I believe the sales drop will be dramatic when the clunker cash disappears in the US,what incentives will be in place then?

I plan on keeping my cars till they die simply because they're reliable, don't cost much to maintain and I don't want to dish out $20,000.00 plus for a new car when I have 3 reliable ones now. Years 75', 92', 97.

One thing I forgot to mention is, I do all my own repairs.


EDIT: If it truly makes you happy having a new car and you don't mind the added expense then go for it.
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Old 07-28-2009, 02:13 PM   #12
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I'm sure you are a keen negotiator and don't need to hear this Janet...... But dealers are working very, very, very hard to try to keep some of that $4.5k for themselves by keeping the price of the new car as high as possible. Be sure you have a reasonable estimate of what you could get your new vehicle for in a cash deal before you start negotiating with the "cash for clunkers" money as part of the scenario.
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Old 07-28-2009, 03:54 PM   #13
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Going through same decision process with 1994 Jeep Cherokee with 99k miles (don't use it much). I think I'll keep the Jeep until it rusts away, rather than take $4500 in exchange for paying $20,000.

BTW, anyone know what will happen with the clunkers? Will the dealers wholesale them to be resold? The gummint wouldn't allow that kind of stupidity in one of their programs, would they?
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Old 07-28-2009, 04:00 PM   #14
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BTW, anyone know what will happen with the clunkers? Will the dealers wholesale them to be resold? The gummint wouldn't allow that kind of stupidity in one of their programs, would they?
They are going to be crushed, like the hopes and dreams of many Americans in this recession...
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Old 07-28-2009, 04:49 PM   #16
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Keep the money, drive it 'till the end. Besides, not likely to be stolen.

I think you could have fun spending lots of money in venues that do not include sparring with salesmen.
All I can say is edmunds or carsdirect. No sales people, but you're right. Even then, there are better ways to spend one's precious time than standing in a car dealership.

Yeah, isn't it strange that the Cash for Clunkers program is bringing out the true colors of some of the posters on this board myself included. Perhaps the program should be renamed Cash for Cheapskates.
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Old 07-28-2009, 04:52 PM   #17
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They are going to be crushed, like the hopes and dreams of many Americans in this recession...
OK, that makes sense. Only the gummint would buy a car for $4500 and then crush it.
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Old 07-28-2009, 05:12 PM   #18
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OK, that makes sense. Only the gummint would buy a car for $4500 and then crush it.
It makes sense when you realize that they are not buying cars, they are buying votes. With our (or our future generation's) money.

It really makes no sense any other way - as far as I can see.

-ERD50
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Old 07-28-2009, 05:35 PM   #19
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The govt should buy the clunkers, remove those wasteful engines, give a contract to their new GM subsidiary to fit each rustbucket with an environmentally-conscious hybrid powerplant, price them at about $50K each to cover the cost of the mil-spec drivetrain, then offer tax incentives of $45K so that people can buy them and feel good about themselves ("I helped GM, I kept a car out of the crusher, and I'm driving a hybrid!").

It helps everyone! More stimulus! Keep those dollars circulating, they came from thin air.
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Old 07-28-2009, 06:20 PM   #20
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I haven't done much research on this since in Canada I believe they give about $300.00 which is actually a joke
As a Canadian taxpayer, it sounds like smart responsible government policy to me
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