Down size the fully paid vehicles.?

[devans0]

We have three vehicles, a Prius (DW's) a box Scion, and an over sized 4x4 diesel truck. Having been through a Mother Nature disaster, I bought the truck for rebuilding, but keep it as a bug-out and camping vehicle.

Financially, downsizing makes sense but since I bought it as a work truck, depreciation on an already depreciated vehicle is minimal. The upkeep hassle will someday prompt me to simplify and downsize. Less stuff means less maintenance time. For me, it is about the emotion drain costs. FWIW I drive six thousand miles a year split in the two vehicles.

 

[kz]

I guess it's a psychological thing for me that our cars are 'paid for'. I'm certainly not judging anyone as to whether their cars are paid for or not. Whether right or wrong here are my reasonings for not making payments on our vehicles.
2001 Truck-we've had it for years....it should be paid for by now
2009 Mid-size SUV....originally took a loan but we're very fortunate to make some money on an investment 18 months ago and paid it off
2007 Wrangler.....it's a toy. At our house toys are paid for with CASH!! (it's an agreement hubby and I made yrs ago, no cash, no toy)

 

[brett]

Only you can be the judge. You know the costs, the opportunity costs, and the utilty or enjoyment that you get from these vehicles. Everyone has a different utility level and financial situation.

 

[powerplay]

I have a pickup and a car and like the flexibility they provide. Pickup is a 96 and car is a 99 model year. Pickup has a yard of garden compost in it right now that I will hopefully get unloaded over the next few days depending on the rain showers. It does cost to maintain and insure 2 vehicles, but for now it is worth it to me. I will probably buy one more new pickup in my lifetime and possibly several cars. I may not want to be hauling around soil or other large or heavy things by the time I am in my later 70's and downsize to just one vehicle at that time.

YMMV though and only you can decide what provides value in your life for your money.

 

[youbet]

I guess it's a psychological thing for me that our cars are 'paid for'.

+1. There ya go. I think that's the case for many folks.

In reality, the wisdom of purchasing a particular item is not necessarily related to how you finance it. But people do like to generalize thinking that everything paid for in cash is a wise purchase and everything paid for on time is a foolish purchase.

Here on the FIRE forum, I'm assuming we all could pay for our cars, applicances, toys, etc., with cash by simply withdrawing the money as part of our RE budget. Whether you chose to make the withdrawal all at once or over 2 - 3 years (with time payments) is a matter financial determination (interest rates, where the money is coming from, etc.). Whether the object being purchased is a wise and prudent purchase is another matter altogether.

BTW, I personally haven't had a "payment" of any kind for over 20 years.

 

[Meadbh]

In finance this is known as "sunk costs". You put a value on something because of what you have already invested in it. Same with houses. If the OP currently had two vehicles, knowing what he knows today, what (if anything) would he pay now to acquire a third? That is the current value of the third vehicle, no matter what was paid for it in the past.

 

[NW-Bound]

BTW, I personally haven't had a "payment" of any kind for over 20 years.

I am younger than you, and I have not had a car payment for 25 years.

And that also applied to new cars purchased from dealerships (meaning a tidy sum).

Now that I am semi-retired and have more time to shop for used cars and wait for good deals, I may not buy new cars anymore.

The last car we bought new (an SUV), we gave the dealer a personal check. Because there was no trade in (we kept the old car for my daughter), and there was no way he could be sure that the check wouldn't bounce, he made up some story about how he needed a couple of days to "prep" the vehicle. He did not want to offend us about wanting to see if the check would clear. I knew the real reason for the delay, so did not press it.

This is in contrast to the usual purchase, when there is a trade-in value to protect the dealer. The dealer would want the buyer to have the new car immediately, lest the latter changes his mind.

 

[Birchwood]

Fully paid and how it happened.

1. the 3 vehicle purchases didn't just happen because I thought it is a lifestyle cool idea. As you can see, the purchases took several years.
2. My high income allowed me to trade in and pay the difference in cash.
3. I would not in any way buy vehicles from my retirement fund.
4. If I could not support the 3 vehicles in retirement, I will sell any of them without any hesitation.
5. The big Ford truck came about bec. where I live at present, we can have 4 feet snow drift in the driveway! My old Subaru don't have such a high clearance.
6. My wife likes to drive her car, but is scared to drive such a big truck.
7. Fully paid concept, I thought was a good thing, since in retirement I don't have to worry about car loans. Whatever I spent on the cars, I already consider it as forever lost or the price to pay for moving around.
8. The cars are only a miniscule part of my asset, and I know the value of which will be almost zero as they get older.
9. I understand that my lifestyle and interest does change, and I don't have any emotional attachment to these vehicles. In the event that I only need a small Prius and a Honda Civic, all these present cars will be sold
and I'll use the proceeds for other things.

 

[NW-Bound]

No, you do not have to justify any of this to us.

Quite a few here have two houses, and some even more than two.

And then, there are also people who want to live in a motorhome, not even a big one but just a small one of 200 sq.ft.

It's all about pursuit of personal happiness, as stated in the Declaration of Independence of this great country.

PS. I have two houses, but recently have been following blogs of people who live in those smaller motorhomes, and thought it would be fun. So, I bought one to try out myself.

 

[Koolau]

I am younger than you, and I have not had a car payment for 25 years.

And that also applied to new cars purchased from dealerships (meaning a tidy sum).

Now that I am semi-retired and have more time to shop for used cars and wait for good deals, I may not buy new cars anymore.

The last car we bought new (an SUV), we gave the dealer a personal check. Because there was no trade in (we kept the old car for my daughter), and there was no way he could be sure that the check wouldn't bounce, he made up some story about how he needed a couple of days to "prep" the vehicle. He did not want to offend us about wanting to see if the check would clear. I knew the real reason for the delay, so did not press it.

This is in contrast to the usual purchase, when there is a trade-in value to protect the dealer. The dealer would want the buyer to have the new car immediately, lest the latter changes his mind.

An old family friend (long since passed) used to pay cash for his cars. When the deal was final, he pulled a wad of $100s out of his well-worn and somewhat soiled overalls and started laying them out on the desk. In the good-old days, 30 or 40 $100s would buy you a decent pickup or car. Wouldn't that be a treat these days?

 

[Birchwood]

Back in the early 1980s I was working for a large medical practice group in the south and as part of my work package was a car, since I have to go to 5 clinics. We used to lease them, then one day my boss talk to me, saying it is better to buy several cars for the practice. He said, choose the car you want as long as it follows certain price range.
I walk to the dealership wearing T shirts and shorts and nobody paid attention to me. The next week, my boss came asking if I have decided!
Yeah I said, I like that 280Z turbo sitting in a local dealership. He told me to have the car in the clinic. I called the snotty salesperson and told him to bring the car in. My boss look over the window, and said, "Is that the car you really want? Yeah, Without looking at the salesman, He ask the price and wrote a check! The secretary even filled up the paperworks.
Of course, the car is not really mine, I just drove it as if I stole it!

 

[Koolau]

Back in the early 1980s I was working for a large medical practice group in the south and as part of my work package was a car, since I have to go to 5 clinics. We used to lease them, then one day my boss talk to me, saying it is better to buy several cars for the practice. He said, choose the car you want as long as it follows certain price range.
I walk to the dealership wearing T shirts and shorts and nobody paid attention to me. The next week, my boss came asking if I have decided!
Yeah I said, I like that 280Z turbo sitting in a local dealership. He told me to have the car in the clinic. I called the snotty salesperson and told him to bring the car in. My boss look over the window, and said, "Is that the car you really want? Yeah, Without looking at the salesman, He ask the price and wrote a check! The secretary even filled up the paperworks.
Of course, the car is not really mine, I just drove it as if I stole it!

Way, cool story, Birchwood. This would be a dream come true for many of us. A good friend got "bumped" from a mid-size to a 300Z turbo rental. Nice!

Almost worth w*rking if you get to drive the car you want - NOT!

 

[kz]

"used to pay cash for his cars" "he pulled a wad of $100s out of his well-worn and somewhat soiled overalls"

OMGosh does that bring back memories. Many, many years ago my father owned his own car dealership and I remember him bringing a wad of $100s home on a few Saturdays (after the bank had closed) 'cause someone would buy a new car with cash. And I vividly remember him saying it was usually a farmer in soiled overalls. Seriously! And then he'd wrap it in foil and put it in the freezer. Reason No. 1....no one would look for it there. Reason No. 2.......in case of a fire it wouldn't burn.

 

[REWahoo]

And then he'd wrap it in foil and put it in the freezer.

Cold, hard cash...

 

[unclemick]

OK, why not? I guess I'm not hearing a question here. You enjoy having the three cars, you can afford them and don't have a more enjoyable way to spend the money in mind, so keep them.

Amen. Two cars both paid for 06 Equinox and a 2000 Chrysler 300M. Will add a third if I find the rat rod or old pickup I can't resist.

Two dogs and a cat. Also might switch houses if I find a nice garage with a house attacted.

heh heh heh - . I was muuch cheaper early in ER. Now loosening up a tad.

 

[W2R]

And then he'd wrap it in foil and put it in the freezer. Reason No. 1....no one would look for it there. Reason No. 2.......in case of a fire it wouldn't burn.

One of our former Louisiana politicians had the same idea.

William Jefferson verdict: Guilty on 11 of 16 counts | NOLA.com

The verdict comes four years after the Aug. 3, 2005 raids of Jefferson's homes in New Orleans and Washington, D.C., in which the FBI found $90,000 in cash hidden in the freezer of his D.C. home, money the government said Jefferson was going to deliver as a bribe to Atiku Abubakar, then vice president of Nigeria, to gain his help with a telecommunications deal in Nigeria

Jefferson is still free pending appeal, though he must be getting discouraged since he put his 6 bedroom, 5 bathroom Uptown home on the market for $725K this week...

 

[Ronstar]

Almost downsized from 4 to 3 last night when I missed a huge buck by inches while doing around 60 mph in my corvette. Probably would have totaled the car - last accident was 20 mph with a fawn that resulted in $3k damage.

 

[haha]

I may have missed mention of this, but IMO biggest cost to any number of vehicles and it goes up with number is the hassle of owning and maintaining them. With one, that cost is usually an OK deal, depending on what other choices you have. But unless you are running a hobby farm, or a contracting business, or towing your RV, the cost/benefit curves can quickly cross.

Most places you may buy something will deliver the stuff cheaply compared to the total costs of owning a truck for those occasions

It just takes up too much lifespace, unless you one of those guys who lives for cars.

Ha

 

[youbet]

I am younger than you, and I have not had a car payment for 25 years.

The last "payment" I had was my mortage which I paid off over 20 years ago when that avenue turned out to be easier than refinancing at the then lower rates. The only car I purchased on time was the VW Beetle I bought right after college 42 years ago. But it's no big deal one way or the other. My point regarding so-called "paid for" cars in this thread is that for folks like us here on the FIRE Forum, the "paid for" or not status of a vehicle (or other toy) is not relevent to a buy/hold/sell decision. I haven't been discussing pros and cons of financing. That's an entirely different subject that would be relevant to folks who could only afford the new car if they paid for it on time.

The last car we bought new (an SUV), we gave the dealer a personal check. Because there was no trade in (we kept the old car for my daughter), and there was no way he could be sure that the check wouldn't bounce, he made up some story about how he needed a couple of days to "prep" the vehicle. He did not want to offend us about wanting to see if the check would clear. I knew the real reason for the delay, so did not press it.

Interesting. I've never had a dealer question my personal check. It's always been accepted immediately despite me having no trade-in. It's not a big deal.

 

[travelover]

I may have missed mention of this, but IMO biggest cost to any number of vehicles and it goes up with number is the hassle of owning and maintaining them. With one, that cost is usually an OK deal, depending on what other choices you have. But unless you are running a hobby farm, or a contracting business, or towing your RV, the cost/benefit curves can quickly cross.

Most places you may buy something will deliver the stuff cheaply compared to the total costs of owning a truck for those occasions

It just takes up too much lifespace, unless you one of those guys who lives for cars.

Ha

Worse, cars that are seldom driven develop all kinds of goofy problems like sticking brake calipers, rust spots on rotors, oil contamination from running cold, tire flat spotting, dead batteries............

 

[rescueme]

"used to pay cash for his cars" "he pulled a wad of $100s out of his well-worn and somewhat soiled overalls".

Yeah, still do that.

Sometimes what you "see" is not what you "get".

I hate buying vehicles, so I try to get some pleasure out of the experience.

 

[rescueme]

Worse, cars that are seldom driven develop all kinds of goofy problems like sticking brake calipers, rust spots on rotors, oil contamination from running cold, tire flat spotting, dead batteries............

Uh, no. That has not been my experience.

My "baby" (2002 Mustang GT vert) runs as well as the day I picked it up, with less than 19k on the odometer.

All original (tires, battery, me) and still runs as long as it's a sunday (a day when the sun is out, with no rain or salt on the road)...

 

[travelover]

Uh, no. That has not been my experience.

My "baby" (2002 Mustang GT vert) runs as well as the day I picked it up, with less than 19k on the odometer.

All original (tires, battery, me) and still runs as long as it's a sunday (a day when the sun is out, with no rain or salt on the road)...

OK, I guess with a sample size of one, you are the expert. I spend a lot of years dealing with issues like lot rot for new cars awaiting final delivery. The issues that I listed are common.

 

[REWahoo]

Ten year old tires. Yikes.

 

[meierlde]

An old family friend (long since passed) used to pay cash for his cars. When the deal was final, he pulled a wad of $100s out of his well-worn and somewhat soiled overalls and started laying them out on the desk. In the good-old days, 30 or 40 $100s would buy you a decent pickup or car. Wouldn't that be a treat these days?

Now days you would put in consideration as a drug dealer, and might get a 3 am unpleasant visit from law enforcement. The dealer would have to file a report on you. Plus depending on where you are driving thru the cops might decide to stop you and confiscate the money (see Carthage Tx for an example).