Poll:Vehicle habits

[CSdot]

What is your usual vehicle buying habit?

(1) PAY CASH for a NEW vehicle and drive it into the ground (not worried about resale of trade in value).

(2) FINANCE a NEW vehicle and drive it into the ground (not worried about resale of trade in value).

(3) PAY CASH for a NEW vehicle, but TRADE every few years while it still has value.

(4) FINANCE a NEW vehicle, but trade every few years while it still has value.

(5) PAY CASH for only USED vehicles because I want someone else to take the big depreciation.

(6) FINANCE only USED vehicles because I want someone else to take the big depreciation.

(7) I LEASE vehicles (either personal or through a business).

(8) I only purchase my cars at the Pebble Beach Concours d'Elegance, and my CPA worries about the details. Might you have any Grey Poupon?

 

[wompo]

Vehicle habits

(1) I buy with cash new and keep them 10 to 15 years

 

[CardsFan]

Over the course of almost 50 years of vehicle ownership I/we have done 1 thru 6.

So I guess we don't have a vehicle habit, and don't need to sign up for VA (Vehicles Anonymous)

 

[2017ish]

Combination of 1 and 5. Until I passed 50, all purchases save 1 minivan were used and all cars were towed away when we sold. After 50, we have bought one new car, but may sell it before 250,000 miles (DW's back is getting tired of monthlong road trips in a Honda Fit). Next purchase? It'll all depend.

 

[swaneesr]

Vehicle habits

The last three vehicles were 5-used cash, 1-new cash, 5-used cash, hold until vehicle is 10+ years old.

Ideally cash purchase a vehicle 2-3 years old, hold for 10 years.

 

[steelyman]

There have been interesting threads on EVs. I’ve been wondering if it’s worth leasing one? I have a trusty ICE SUV but it’s got many years on it.

 

[OldShooter]

... wondering if it’s worth leasing one? ...

IMO leasing is just a complicated, opaque, and expensive way of borrowing money unless one finds a seriously below market deal offered by the seller. YMMV, of course.

 

[CSdot]

(1) I buy with cash new and keep them 10 to 15 years

Very similar to me. I pay cash for new vehicles. I do not want to replace a used car with a used car, but I will admit to looking for testers with a few thousand miles at the end of the month to get a better discount.

I prefer a nicer level of vehicle, with the extra bells in whistles, if available. My last few have been two E class Mercedes, two Honda Odysseys and a Jeep Grand Cherokee. I drive them for approximately 100,000 miles (about 7 years), then if it has been a good reliable vehicle, I hand it down to a kid or keep it as a second or third vehicle. My most recent is a 2019 Mercedes, but we still have my wife's Odyssey, my old Grand Cherokee (now off at college with son) and a 1995 Miata bought new in law school (tax is maybe $10 a year).

If the vehicle has problems, especially ones I think might cost me big money in the future, then the vehicle gets traded or donated.

 

[Midpack]

Until 1988 when we were young with no money I bought used (about 2 yo), and it is the most cost effective approach. But since then we’ve bought new and kept the cars for 8-11 years, from 80K to 164K miles. I wouldn’t call that ‘driving them into the ground’ but reasonably cost effective.

 

[bobandsherry]

IMO leasing is just a complicated, opaque, and expensive way of borrowing money unless one finds a seriously below market deal offered by the seller. YMMV, of course.

IMHO I disagree. Hardly complicated, it's very simple as it's simply negotiating payment. It's hardly opaque, very clear as to what it will cost. And my experience with now on my 5th lease, it's cheaper than buying.

Like anything, those educated can do well.

 

[CSdot]

I wish I could be savvy enough to trade every 2-3 years and always drive a new car, but I worry I would take a bath on the trade in. The car the dealer told you was in demand when you purchased it will instantly become the dog with fleas that he tells you no one wants at trade in time.

I know some understand the lease process, but I suspect I drive too many miles a year, plus I don't like owing someone money.

 

[cat4ever]

(1) for the most part, although life events sometimes cause detours. e.g. Second baby = good bye jeep wrangler, hello SUV. HS Graduation = graduate gets my current, 4 year old used car, but I'm retired so am in no hurry to get one of my own.

 

[Aerides]

Pay cash for a new vehicle until I decide that it needs repairs and/or I just don't really like it anymore, and/or there's some new shiny model/feature that I really want.

 

[ransil]

I'm mostly #2

 

[Car-Guy]

#3

 

[RobbieB]

Motorcycles - Buy new, pay cash. Except my "learner" a used Honda 350 that cost $300

Cars - Been blessed with Company rides mostly. All new leasers of course. With free insurance, gas, oil and repairs. Bought a '57 Chevy Bal Aire in Texas, bought a '83 T-Bird in '85 and I bought me my first new car, the '19 Impala 2 years ago.

So, new and paid cash; six motorcycles and one car. Used and paid cash: one motorcycle and two cars.

 

[Ready]

I have traditionally kept my vehicles for around 8 years. But now that we have Teslas I’m not sure what to expect. Teslas are sort of like IPhones. If the tech keeps getting better I suspect I’ll want to upgrade more frequently. I usually get a new Iphone every two years, but hopefully I won’t have to do that with our cars.

 

[aaronc879]

I didn't vote. I have bought used three times. Once was financed and twice was cash. The first two were driven several years before I upgraded to better vehicle even though there was some life left. The third I still own. I bought a new car once and financed it. It was a 63 month loan but I paid it off after around 36 months and have kept it for 17 years. I will drive my current cars until they die or nearly die then I will buy a new car and keep it until it's near death(15+ years). I may pay cash or I may finance if it's at 0.9% or lower. I doubt many people fit under just one catagory.

 

[TheWizard]

I've always bought new vehicles, beginning back in 1975.
I buy new shoes as well, not used ones.

Back in the old days, I wasn't rich enough to pay cash, so I financed the car for a few years.

Nowadays, in retirement, I pay cash.
Single, I keep two vehicles for convenience: a Mustang convertible and a F150 pickup.
The 2008 Mustang is getting old , so I'm looking for a new one, a hybrid AWD.
If only Ford would make one, I would order one...

 

[pb4uski]

We used to buy 1-2 year old cars that still had at least a year of mfg bumper-to-bumper warranty left and we could get them at a good discount compared to buying new.

When we were in the market for a new car 5 years ago that discount was much slimmer so we bought new.... ordered the car so we could get exactly what we wanted.

We usually keep our cars for 5-10 years and less than 100k miles... though today's cars are so good I'm thinking of increasing my mileage limit.

 

[skipro33]

None of the above but one comes close. I finance a new vehicle every few years but only if interest is below 1%. I finance for 48 to 60 months (4 to 5 years) I make sure the car is paid off at the end of 4 years. During the 5th year, I will attempt to trade in. If the dealer makes me a fair offer on trade-in, fine. If not, then I'll sell on my own via craigslist or other local listing.
By doing this, I stay with a modern car with payments well below $300 a month. In my current case, I bought a 2020 Subaru Ascent in November of 2019. My trade in was a 2015 Subaru Forester. Payments on the new car is $265 a month after trade-in and will be paid off in 4 years, 48 months, from the time I bought it. This includes the extended 'Gold Plus' bumper to bumper warranty. No smog checks, no wrenching, free loaners, free tow, $500 a night if break-down happens more than 50 miles from home, etc. I budgeted for this amount when I retired, not wanting to work on the family car if I didn't have to.

My other main vehicle is a 2006 Dodge Ram 4x4 Diesel I use to haul my camper around as well as tow my boat. It has 77,000 miles on it, barely broke in for a diesel. Around 5,000 miles a year is all I drive it. I bought new and financed for 5 years. I'll keep this truck until I die or it somehow gets destroyed and I need to replace. I paid $32,000 out the door. Same truck today is in the neighborhood of $75,000. At that price, this truck will always be repairable unless it's been in a serious wreck that I probably wouldn't survive anyways.

 

[CardsFan]

We usually keep our cars for 5-10 years and less than 100k miles... though today's cars are so good I'm thinking of increasing my mileage limit.

+1

The problem is, we tend to put less than 7,000 miles per year on each car, so I am good with upgrading every 8-10 years, even if there is only 60-70,000 miles on the car.

That reminds me, my car is now 9 years old, with about 65,000 miles. Must be time to upgrade.

 

[pb4uski]

IMHO I disagree. Hardly complicated, it's very simple as it's simply negotiating payment. It's hardly opaque, very clear as to what it will cost. And my experience with now on my 5th lease, it's cheaper than buying.

Like anything, those educated can do well.

I'm with Old Shooter. I have a few friends in that lease and it's just perpetual car payments... but the are always driving a new car.

We just finished paying off our 5 year old car that has 75k miles and is in great shape... I picked up a friend at the airport and he is a car guy and asked me when we got our new car (it's 5 years old). So my monthly car payment is currently $0 and I expect it will be for 2-3 years at least.

I've looked at leases over the years but have never found one that was financially compelling.

 

[bobandsherry]

I'm with Old Shooter. I have a few friends in that lease and it's just perpetual car payments... but the are always driving a new car.

We just finished paying off our 5 year old car that has 75k miles and is in great shape... I picked up a friend at the airport and he is a car guy and asked me when we got our new car (it's 5 years old). So my monthly car payment is currently $0 and I expect it will be for 2-3 years at least.

I've looked at leases over the years but have never found one that was financially compelling.

I don't look at it as continued payments. Those who pay cash just prepay their payments. Lol. I look at total cost per year. Then compare with how much I'd spend over a 10 year period depending on maintenance, repairs, etc. For me, I enjoy a newer car every 3 years for either new safety or tech, plus maybe just get tired of looking at same car for too long. Just the way I roll.

As I said, I consider the cost over 10 years, that seems to be what the "frugal" find their sweet spot to buy and hold. I use my own estimates as every time I ask those who claim to be frugal how much they spend over 10 years, including the cost of vehicle less the value after 10 years, plus any repairs and maintenance they've put into the car, I never get anyone to share that. So I estimate the expense for new tires, batteries, oil changes, wiper blades as well as something going wrong within a 10 year period like an alternator.

For me, my cost over past 5 years has been just under $20k. For 7 years my cost will be about $27k. Cars I drive are between $40-50k. My current car had $46k MSRP, my lease payment is $300/mo. That's no money down which is only way anyone should lease a car. I don't pay for maintenance as dealer covers the scheduled maintenance. I'm always under warranty, so any repairs are covered. I also get a free loaner when car is due for maintenance or warranty work, they bring the car to me. I don't drive massive miles, 12k/yr is sufficient for my driving needs, more so for past year due to Covid. So my out of pocket costs truly is just my payment, I'm ok with $3,600/yr (18 more months). Plus a new car with new tech and safety.

If you don't mind sharing, what's your all in cost for 5 year period for owning your car; loan payments, maintenance and repairs, less what you reasonably think your equity is today? How much you expect you'll spend on repairs and maintenance for the next 2 years when you enjoy the freedom of no payments?

 

[statsman]

In the past, mostly #2. We kept vehicles between 9 to 13+ years. DW's previous commute vehicle, which only has ~62,000 miles, was purchased new May 2007, so approaching 14 years ago. The Nissan 3.5L engine in her Infiniti is nearly bulletproof. Quite possibly the best engine we've ever owned. It serves as our second/backup vehicle.

Our current main vehicle and the one I mostly drive was paid for with cash, so option #1 there. It was purchased new July 2015, so 5 1/2 years ago. It replaced a vehicle owned for 13 1/2 years. Only 31,000 miles on it, so it should last a while.

My only complaint is it's a FWD vehicle. Was fine back in the California. Would prefer to have AWD for the colder/icy roads in the winter, flooding from rains, and clay/debris on the roads from the constant surrounding construction here in Texas.

Any further purchases going forward will be cash (#1).