Down size the fully paid vehicles.?

I'd try to get by with just one car, but if you are in backwoods CO I'd sell the Honda and the Nissan and get something with 4W drive to go along with the truck.

Me, I have 6 vehicles. One Honda civic and five bicycles. I live in a town with good public transportation so I'm thinking of selling the Honda when I retire and just renting or using Zipp Car for those occasions when I really need a car. I also might buy one of these.......

385x385-7714cf9a51222aa690cc5eca9dc56d52.jpg


or I might have to get this, which costs the same as the vespa

1270723391745-12apsviirzme3-280-75.jpg
 
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Though we only have 2 cars (for 2 people) I've struggled with this question as well. Our cars are about 12 years old, so depreciation is minimal. Insurance and tags are the big expenses for us. She likes her car and I like mine. (Okay, she hates my car and I hate hers - full disclosure). If we sell one, it can only be mine as her car is much easier for her to ingress/egress. Right now, she can not even drive due to injury. We are hopeful the health issues will abate soon, but we don't have a guarantee at this point. She is only capable of riding in her car - not mine. Because of her need for care, I rarely leave home without her so my car sits right now. Normally, we drive 10K per year total. Currently, DW is nearly housebound (trips to doc and the occasional "sanity" outing) so our present miles-per-year is more like 3K.

Probably my most compelling reason to keep both cars is in case one conks out - which is always a possibility given age and miles. I don't want to depend on public transportation, though ours is better than most.

So far, we think we can afford the extra vehicle, so we've put off any decision, and that's probably where it will stand. If DW's disability persists, we'll need to rethink this, but that will be later.

I really do think it comes down to perceived "value" vs cost. We aren't taking any money with us when we leave planet Earth, so unless you want to fatten your heir's wallets some day (or have charities you wish to endow) you might as well spend your ER money the way that gives you the most pleasure/utility. Just keep within the 4% rule or whatever ER philosophy you live by. Oh, and YMMV.
 
We'll have two paid off Toyota Camrys when I retire. One (2007) is paid now, the other (2010) has about $1100, zero interest) to go, so will be soon finished. However, sometime late next year, I'll be shopping for a late model pickup, cause I gots to have somthing to tow a boat. Probably will keep both Camrys and also have a truck. I don't really expect to finance much if any of the truck. Unless I can get another zero interest loan, that is!

Oh...sorry...was supposed to be a thread about DOWNSIZING the vehicles... In that case, NO, I don't think so because:

1. The Camrys get 30+ mpg at highway speeds and are big enough to be comfortable for a guy like me (6'2" & 240 lbs).
2. They are very reliable and I expect them to be fairly trouble-free, based on previous experience.
3. That's it!
 
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Birchwood said:
I am planning to retire next year. Just like most Americans, despite my relative frugality, due to the fact that we live in a town where there is no public transit, plus we have awful winter weather, we ended up having
three vehicles. Fortunately for us, they are all fully paid.

What is the thought of the group with regards to "fully paid" vehicles.?
Should we just keep them until the wheels fall off? Is there a financial benefit is keeping one and trading the two left to a newer one, thus downsizing to 2 newer ones.
The vehicles are:
1. Ford F150 Supercrew 4x4 truck -4000miles only
2. Honda Accord Coupe v6 - 15,000 miles.
3. Nissan Altima v6- 23,000 miles.
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I'll "see" your 3 vehicles and raise you 1. :cool:

My 3, all paid for and with various odometer readings...

1. 2005 Mustang convertible, less than 15K miles, 6 cyl, 5 speed, summer only "fun" car for me. :D
2. 2002 Jeep Grand Cherokee, 90K miles, 8 cyl automatic, winter only car for extreme bad weather. Also handy for picking up items at stores than cannot fit inside the others and transporting my 2 dogs.
3. 1992 Honda Accord, 150K miles, 4 cyl, 5 speed, best mpg of the fleet, winter rat for short distances and recently an all year short distance beater car, so Mr B can save adding yet more miles on his 2003 Impala. Very low maintenance vehicle and no collision coverage. :LOL:

Mr B's wheels...

1. 2003 Chevy Impala, 6 cyl automatic, 160K miles, long distance car to MA and my spare 3-season wheels when he hijacks my Honda. We garage this car in the winter unless we are going to MA.

We will run the Honda into the ground so we can keep the mileage low on the Jeep and Impala. The Honda's retirement will most likely not happen for a very long time. :D
 
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REWahoo said:
Uh, it looks like you may have already missed the boat on the Chevy...:)
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That's from Mr B's pre-Freebird era, the dark ages so to speak. :LOL:

We trust this car to get us to MA and back, no problem at all. It has been and continues to be well maintained. I actually enjoy driving it despite its lack of a clutch. ;)
 
We have two paid off cars, a Jeep Wrangler and an Infiniti G35X. We have always had two cars, but after retiring we seldom use both cars at the same time. So we and are considering downsizing as well. We also have a 30 ft motorhome, which we purchased after we retired. Before retiring I never would have thought that we would only use one car.

Because the Jeep is good during the winters and easy to tow, it is probably the one we will keep. But after living in Colorado for about 26 years we have been able to go skiing and explore the state with any front wheel drive vehicle. If you are thinking about serious off-roading, a large truck can be a challenge. The don't make the turns on the "trails" very well.

It is hard to predict what your lifestyle will be after retirement. One car and a motorhome for us, and four cars and a Cessna for others!
 
Keep 'em all. Heck I have a monster suburban 99, a car 95Jag, DW has a Buick. Works out just fine. All paid for long ago. None worth a lot on the used market. Yet they are all in excellent shape in the paint and mechanicals.

DW does not like to drive either of my wheels, I don't much care for driving the Buick, mind you it is great driving car, just not my style.
 
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We have two cars for a two person household, which I think is shameful (as far as impact on the planet), but where we live because of weather and poor public transportation, it helps our relationship. So I understand the emotional issues involved, and it's your decision what is important, as long as you can afford it. I'm not telling how many bicycles I own.:angel:
I owned a pickup for many years until it rusted away. I wanted another to replace it, but in our situation, doing the math, it's much much cheaper (and greener) to have a hatchback for the occasional hauling (put down the back seats and line it with a big tarp, I've hauled topsoil that way), and the one time we really needed a truck, we rented it for a full day for less than $50 total.
 
Colorado car tax.

I studied Colorado car tax. MSRP X85%, then X 2% for a 1 yr old car, and then slowly going down 1.5%, 1% etc and very low flat tax on old cars.
BTW, it appears we have to pay that every year. It sucks!

But that is the price we have to pay for moving and enjoying life.

I figure it's an additional $1200/year to support the 3 vehicles, on top of plates, maintenance, insurance, and repairs.

But then, this is America, unless we live in a metro area, a vehicle is needed for daily living.

Besides a house, the cars are the next big ticket item, and as long as we are alive, we need to get around!

Since they are all fully paid for and are relatively new, I might as well
keep them all until they are so old that it's no longer practical to keep them.

If we trade the two cars(still worth 41K) to one 41K vehicle, we'll not save much since the Co. tax is MSRP x 85%x2%, about$700 to go to Colorado. Wow!
 
If you like what you have why not keep them? Hubby and I have 3 vehicles in retirement and it works for us for now. We use the oldest vehicle, an 11-yr old truck (114,000 miles) for hauling ATVs, yard waste, items for friends, etc. The next vehicle, my 2 yr old mid-size SUV (30,000 miles) is our long-distance travel vehicle and the last vehicle is the 4-yr old Jeep Wrangler (27,000 miles) which is just for fun! A few yrs down the road we might like to upgrade the truck and at that time we'll revisit the use of the Jeep but for now we our comfortable with what we have. Fortunately insurance and registration aren't much of an issue for us, the vehicles are all paid for and we have a 3-car garage to store the vehicles.
Sure, we could live without any of them (ok....we need 1) but that's what we worked hard and saved for and now we're enjoying them.
 
I'm a bit mystified by the emphasis by OP and a number of subsequent posters on the vehicles being "paid for." Assuming you can afford to have "extra" vehicles, does it really matter all that much whether you withdrew the money to pay for them up front and they are "paid for" or if you are withdrawing the money slowly over time.

I understand that in the second scenario you're paying interest. But in today's low interest environment, that might not be such a big deal. Does the paid-off or not paid-off status of the vehicles really matter to the decision?
 
youbet said:
I'm a bit mystified by the emphasis by OP and a number of subsequent posters on the vehicles being "paid for." Assuming you can afford to have "extra" vehicles, does it really matter all that much whether you withdrew the money to pay for them up front and they are "paid for" or if you are withdrawing the money slowly over time.
Click to expand...
I think it is similar to the 'pay off the mortgage prior to retirement' strategy - you'll need less income in retirement if you aren't paying car notes. Less income also means lower income taxes in many cases.
 
REWahoo said:
I think it is similar to the 'pay off the mortgage prior to retirement' strategy - you'll need less income in retirement if you aren't paying car notes. Less income also means lower income taxes in many cases.
Click to expand...

I don't think that's true in retirement.

Say I have a one million bux FIRE portfolio. I buy a car and withdraw $30k to pay for it and now have a $970k FIRE portfolio and a "paid for" car. Or...... I pay over time and withdraw $10k/yr + interest for 3 years to pay for it. Other than the interest, what's the difference? Income needs aren't involved.

Now, having said that, I haven't had a car payment since I was a kid. It's just been more convenient to pay cash. But I don't see the "paid for" or not status being a relevent factor in a decision regarding how many vehicles you can afford and is the expense of owning a fleet of vehicles the best use of your money given your personal situation and tastes.
 
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youbet said:
I'm a bit mystified by the emphasis by OP and a number of subsequent posters on the vehicles being "paid for." Assuming you can afford to have "extra" vehicles, does it really matter all that much whether you withdrew the money to pay for them up front and they are "paid for" or if you are withdrawing the money slowly over time.

I understand that in the second scenario you're paying interest. But in today's low interest environment, that might not be such a big deal. Does the paid-off or not paid-off status of the vehicles really matter to the decision?
Click to expand...

To me it does. I view paying any amount of interest as a waste of money in today's environment where the only guaranteed returns on investments are less than 2%.
 
youbet said:
I don't think that's true in retirement.

Say I have a one million bux FIRE portfolio. I buy a car and withdraw $30k to pay for it and now have a $970k FIRE portfolio and a "paid for" car. Or...... I pay on time and withdraw $10k/yr + interest for 3 years to pay for it. Other than the interest, what's the difference. Income needs aren't involved.
Click to expand...

True, but the OP isn't retired yet.

The way I read it, he was pointing out he won't have to withdraw funds from his retirement portfolio to make car payments if he keeps them after retiring, so that shouldn't enter into the keep/sell decision.
 
REWahoo said:
True, but the OP isn't retired yet.

The way I read it, he was pointing out he won't have to withdraw funds from his retirement portfolio to make car payments if he keeps them after retiring, so that shouldn't enter into the keep/sell decision.
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I understand. Still, it seems like the "paid for" or not situation inappropriately bears on these decisions with many folks.

Here is a good example, although it's about a mortgage:

A close friend just finished building his retirement dream house. He's 64 and his DW is 69, yet they took on a 4% 30 year mortgage. Why? Certainly not because they can't afford the beautiful new home. It's because their savings are primarily in deferred accounts and withdrawing $200k (the difference between their old home and this one) from a TIRA in one year would have triggered high taxes. (The withdrawal would have been on top of hefty pensions.) So they'll pay off the mortgage at a pace determined by how much they can withdraw annually without triggering the tax bracket they're trying to avoid, the elimination of certain deductions and higher Medicare premiums.
 
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skyvue said:
To me it does. I view paying any amount of interest as a waste of money in today's environment where the only guaranteed returns on investments are less than 2%.
Click to expand...


As I stated, we're discussing the issue of whether a fleet of vehicles is affordable and the best use of money for OP. Whether you choose to withdraw the money from your portfolio all at once to pay for them and avoid the interest or to withdraw the money over several years and pay interest just doesn't seem relavent.
 
youbet said:
I understand. Still, it seems like the "paid for" or not situation inappropriately bears on these decisions with many folks.

Here is a good example, although it's about a mortgage:

A close friend just finished building his retirement dream house. He's 64 and his DW is 69, yet they took on a 4% 30 year mortgage. Why? Certainly not because they can't afford the beautiful new home. It's because their savings are primarily in deferred accounts and withdrawing $200k (the difference between their old home and this one) from a TIRA in one year would have triggered high taxes. (The withdrawal would have been on top of hefty pensions.) So they'll pay off the mortgage at a pace determined by how much they can withdraw annually without triggering the tax bracket they're trying to avoid, the elimination of certain deductions and higher Medicare premiums.
Click to expand...

I agree with your mortgage example, but I see the situation a little differently with the OP's car situation.

The OP apparently didn't use money from his retirement nest egg to purchase the three vehicles, nor does it appear they were purchased in preparation for retirement. The three vehicles are part of OP's current lifestyle. He's planning on retiring next year and he is wondering whether or not to keep all three vehicles in retirement. Their 'paid for' status does have a bearing on the decision, at least to my way of thinking.

And just for the record, I don't like annuities... :)
 
REWahoo said:
I agree with your mortgage example, but I see the situation a little differently with the OP's car situation.

The OP apparently didn't use money from his retirement nest egg to purchase the three vehicles, nor does it appear they were purchased in preparation for retirement. The three vehicles are part of OP's current lifestyle. He's planning on retiring next year and he is wondering whether or not to keep all three vehicles in retirement. Their 'paid for' status does have a bearing on the decision, at least to my way of thinking.

And just for the record, I don't like annuities... :)
Click to expand...

You'll probably reading details into the scenario which may or may not actually be there. I'll stick to my point, the "paid for" or not status of the vehicles is moot given that OP can afford to have three cars in retirement. If the cars are paid for, OP took the money from someplace. If not, he still has the money.

I'm just sayin' that I sense that folks are inappropriately impacted by the "paid off" or not status of things. I think that if you can truly afford something, whether you decide to withdraw the money at once and pay up front or to pay over time isn't all that relevent to the purchase/hold/sell decision.

I think it's an issue that folks tend to generalize affordability with paying cash. That may or may not be true. My friend from the post above can afford his fancy new home. He could pay for it ten times over with cash if desired. He can afford it despite taking on a 30 year mortgage in retirement. A younger person who paid cash for the same home but depeleted their savings in doing so probably can't afford it. Yet, they paid cash.

Ya gotta know the details.
 
There's something to be said for having one fuel-efficient vehicle for personal transportation and a big, powerful vehicle to haul stuff. Especially if they are all paid for. And if there are two of you doing a fair bit of driving (and you'd often both need a car at the same time), I see nothing wrong with having two cars and a single big hauling vehicle like a truck or SUV. Again, that's even more true if you can afford them and they are all paid for.
 
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