Join Early Retirement Today
Reply
 
Thread Tools Search this Thread Display Modes
Should I sell my car?
Old 04-29-2015, 08:34 PM   #1
Recycles dryer sheets
 
Join Date: Feb 2013
Posts: 187
Should I sell my car?

Having just paid my license plate annual renewal fee ($100), 6 month car insurance policy ($350), and facing my city sticker renewal in Oct ($100) plus anther 6 month policy ($350), I am highly considering selling my car.

I live in Chicago and take the train to work everyday. I really only use my car to drive to the grocery store, the gym, and the occasional random place (target, a sports game, random store, to dinner with a friend if more convenient etc).

My car is paid for and is about 4% of my net worth excluding my home. Given that I rarely drive, and pay ~$1,000 a year just for insurance and registration, I am highly considering selling it.

If I sold it, I could rent a zip car when needed, or take an uber and not feel bad about it, given that I am saving ~$1,000 a year.

The easy and obvious answer is "yes" why wouldn't I sell it? I've only had it about a year, and I must say, it is very convenient to have when I do use it. But the amount of money I am paying for it is crazy.

I am reluctant to sell it because I think I will miss it, and I did some back of the envelope calculations, and if I were to add the approx $12k I could get back if I sold it to my portfolio, in 15-20 years, I would only be about $27-$28k wealthier in today's dollars (this only takes into account the $12k lump sum - not the additional $1,000+ I'd be saving year over year). Plus, given that I drive so little, it will likely last me many many many years, but over those years, my annual licensure and insurance costs will surpass the cost of the car.

Thoughts?
__________________

__________________
younginvestor2013 is offline   Reply With Quote
Join the #1 Early Retirement and Financial Independence Forum Today - It's Totally Free!

Are you planning to be financially independent as early as possible so you can live life on your own terms? Discuss successful investing strategies, asset allocation models, tax strategies and other related topics in our online forum community. Our members range from young folks just starting their journey to financial independence, military retirees and even multimillionaires. No matter where you fit in you'll find that Early-Retirement.org is a great community to join. Best of all it's totally FREE!

You are currently viewing our boards as a guest so you have limited access to our community. Please take the time to register and you will gain a lot of great new features including; the ability to participate in discussions, network with our members, see fewer ads, upload photographs, create a retirement blog, send private messages and so much, much more!

Old 04-29-2015, 08:38 PM   #2
Recycles dryer sheets
 
Join Date: Feb 2014
Location: San Diego
Posts: 70
Keep the car and earn another $13,000 a year. You'll probably want to buy another car within a few years and that will cost you more than $12k. Good luck
__________________

__________________
DH retired 2014.
Sold my business in '16 and retired 5-17!
Ginny is offline   Reply With Quote
Old 04-29-2015, 08:56 PM   #3
Moderator Emeritus
Bestwifeever's Avatar
 
Join Date: Sep 2007
Posts: 16,375
DH and I were carfree in Chicago for the first three years we were married. Like you, we took the train/el/bus everywhere. I highly recommend selling your car and squirrelling the $ away until you really need a car more often than not.
__________________
“Would you like an adventure now, or would you like to have your tea first?” J.M. Barrie, Peter Pan
Bestwifeever is offline   Reply With Quote
Old 04-29-2015, 09:01 PM   #4
Moderator
Sarah in SC's Avatar
 
Join Date: Sep 2005
Location: Charleston, SC
Posts: 13,457
Wow, I can't believe it costs $1k annually to keep a car there! That's a lot for something you don't use all that often.
I'm a total car junkie, and live in a place where I'd quickly starve to death without one, but even I see your point about selling it.
Tough call, but maybe you could share the car and expenses with a relative or close friend? Just thinking of alternatives to ditching it completely.
__________________
“One day your life will flash before your eyes. Make sure it's worth watching.”
Gerard Arthur Way

Sarah in SC is offline   Reply With Quote
Old 04-29-2015, 09:07 PM   #5
Recycles dryer sheets
 
Join Date: Feb 2013
Posts: 187
My plan would be to sign up for zip car, which is a car sharing service.

There are 3 cars in a lot next to my condo. You can reserve them on the mobile app or online and you pay $7-10 an hour for them.

Or, I would just take a taxi.

I'd have to use quite a few zip cars or taxis for $1k!


Sent from my iPhone using Early Retirement Forum
__________________
younginvestor2013 is offline   Reply With Quote
Old 04-29-2015, 09:54 PM   #6
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
 
Join Date: May 2005
Posts: 13,291
Can you get a cab easily where you live When I was in NYC, it was so easy to get a cab... but I rarely used a cab there or in London... the subway is just too convenient to use and gets you to almost every location you want...

I lived 4 years where I did not have a car where I was... still had a car at my house.... (note: I was only supposed to be away for 6 to 9 months... )
__________________
Texas Proud is offline   Reply With Quote
Old 04-29-2015, 10:20 PM   #7
Thinks s/he gets paid by the post
 
Join Date: Dec 2014
Location: Florence, AL/Helen, GA
Posts: 2,093
For your situation, keeping the car or selling the car would be okay. The question is whether you can sell the car for the payoff--or for what it's really worth since you've not had it very long.

I'm car poor with 3 cars and a truck sitting in my driveway--for 2 drivers. Auto and home insurance are our biggest expenses with no car debt and 3 houses paid for.
__________________
Bamaman is offline   Reply With Quote
Old 04-29-2015, 10:23 PM   #8
Thinks s/he gets paid by the post
 
Join Date: Oct 2012
Location: Colorado Mountains
Posts: 2,147
I think you are quite a bit low on your annual savings. Maintenance and fuel will bump you up another $1000 a year. That was my experience. I always had a second car and maintenance and tires, etc. seemed to always cost a lot no matter how little I drove it.
__________________
Hermit is offline   Reply With Quote
Old 04-29-2015, 10:39 PM   #9
Full time employment: Posting here.
 
Join Date: Jul 2013
Posts: 568
How often do you use it? $1k/12 = $83 a month. To me it's worth having a used but dependable car for less than $100 a month.
__________________
dvalley is offline   Reply With Quote
Old 04-29-2015, 11:16 PM   #10
Recycles dryer sheets
 
Join Date: Aug 2014
Location: Western Canada
Posts: 393
$1K/year is about $20/week. Can you get cabs/uber/zip cars for that? When you want them? I wouldn't even consider it.
__________________
I'm not crazy. Honest, the judge had me tested.
Rick_Head is offline   Reply With Quote
Old 04-29-2015, 11:26 PM   #11
Full time employment: Posting here.
 
Join Date: Jan 2011
Posts: 575
I agree with Hermit - I think you need to add gas and maintenance in your calculation. You live in the city where there are public transportation. If you need to go outside the city once in a while - rent a car. I would get rid of the car.
__________________
KingB is offline   Reply With Quote
Old 04-29-2015, 11:33 PM   #12
Moderator Emeritus
Bestwifeever's Avatar
 
Join Date: Sep 2007
Posts: 16,375
Does your condo have a parking space? Could you rent that out if you got rid of the car?
__________________
“Would you like an adventure now, or would you like to have your tea first?” J.M. Barrie, Peter Pan
Bestwifeever is offline   Reply With Quote
Old 04-30-2015, 06:01 AM   #13
Recycles dryer sheets
wrigley's Avatar
 
Join Date: Nov 2008
Location: Jacksonville
Posts: 345
$1000 a year isn't squat knowing that you have a car any time you need it. If you sell the car and then realize you really need one/want one, you're going to fork out a large chunk of change to get one. Keep what you have.

Mike
__________________
wrigley is offline   Reply With Quote
Old 04-30-2015, 06:37 AM   #14
Thinks s/he gets paid by the post
jollystomper's Avatar
 
Join Date: Apr 2012
Posts: 1,364
Figure out what you really will be saving. Your are looking at the gross, not the net. A zip car for say $10 an hour. used an hour or less, means that if you use one twice a week you are spending over $1000 for the year. So you would not be saving anything.

You should add in your maintenance/fuel costs, then subtract an estimate of what zip car/taxi/subway would cost per trip that you use to go to grocery/gym/occasional shopping (number of trips made today versus perhaps some fudge factor for a conservative estimate). Then you would be closer to what you would actually be saving.
__________________
Current target FIRE date: Under negotiation, can happen anytime.
jollystomper is offline   Reply With Quote
Old 04-30-2015, 06:40 AM   #15
Thinks s/he gets paid by the post
photoguy's Avatar
 
Join Date: Jun 2010
Posts: 2,301
Why don't you try not using your car for a month or two and see if you can survive without it.

Given that your renewal fees are a sunk cost, it will only cost you about $60 a month to test out (insurance costs).

Of course you might feel differently about waiting for the bus in winter.
__________________
photoguy is offline   Reply With Quote
Old 04-30-2015, 08:50 AM   #16
Thinks s/he gets paid by the post
 
Join Date: Apr 2010
Posts: 1,693
YES. Get rid of it. It is a money pit.

We lived downtown in a large city. We had a tight budget..I was in university.

We looked at the cost of the car, gas, parking...everything you mentioned. Everything was nearby and we walked. Plus we both had bicycles.

It was far less expensive for us to rent a car on those weekends when we needed one. Plus we found that there were many great car rental deals on the weekend so we would occasionally take advantage of them when going to visit relatives in another city.

We just moved from the suburbs to the city edge..walking distance to rapid transit. The first thing to go was our second car.
__________________
brett is offline   Reply With Quote
Old 04-30-2015, 10:23 AM   #17
Full time employment: Posting here.
 
Join Date: Jul 2007
Location: ST LOUIS
Posts: 995
What are your yearly property taxes on the car?
__________________
Proverbs 15:22 Designs are brought to nothing where there is no counsel: but where there are many counsellors, they are established.
rec7 is offline   Reply With Quote
Old 04-30-2015, 11:34 AM   #18
Recycles dryer sheets
 
Join Date: Feb 2012
Posts: 443
Quote:
Originally Posted by younginvestor2013 View Post
My plan would be to sign up for zip car, which is a car sharing service.

There are 3 cars in a lot next to my condo. You can reserve them on the mobile app or online and you pay $7-10 an hour for them.

Or, I would just take a taxi.

I'd have to use quite a few zip cars or taxis for $1k!


Sent from my iPhone using Early Retirement Forum
Who carries the insurance? Wouldn't you still need some type of auto policy to cover you in the event you cause an accident? Same if you use rental cars.
__________________
TrvlBug is offline   Reply With Quote
Old 04-30-2015, 11:53 AM   #19
Recycles dryer sheets
 
Join Date: Dec 2006
Posts: 291
Quote:
Originally Posted by wrigley View Post
$1000 a year isn't squat knowing that you have a car any time you need it. If you sell the car and then realize you really need one/want one, you're going to fork out a large chunk of change to get one. Keep what you have.

Mike
+1
__________________
bubba is offline   Reply With Quote
Old 04-30-2015, 11:56 AM   #20
Recycles dryer sheets
 
Join Date: May 2014
Location: Yuma AZ
Posts: 270
To maintain potential freedom to drive when necessary, how about selling the $12k car and get a "beater" to use in an emergency?

While the wife and daughter drive "newer" vehicles, my run errand, haul stuff vehicle is a 27+ year old Samurai, with 240k+ miles on it. It looks as worn and tired as I feel, but whenever I turn the key, it starts.

I see the minimal registration and insurance cost as "insurance" that I can get around where and when I need to.
__________________

__________________
unno2002 is offline   Reply With Quote
Reply


Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
 
Thread Tools Search this Thread
Search this Thread:

Advanced Search
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


Similar Threads
Thread Thread Starter Forum Replies Last Post
Should I sell my car? Katsmeow Other topics 28 05-30-2013 09:42 AM
When should one sell their underperforming funds? Moscyn FIRE and Money 13 06-14-2010 06:06 PM
How do I sell my car? Ronstar Other topics 20 05-16-2009 08:46 AM
Should I sell Wellington and Wellesley? FIREd Stock Picking and Market Strategy 6 03-04-2009 09:11 PM
New car, old car, same car? cute fuzzy bunny Other topics 74 06-15-2006 05:27 PM

 

 
All times are GMT -6. The time now is 05:29 AM.
 
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2017, vBulletin Solutions, Inc.