To trade or not to trade?
 

I'd like to get some input from some smart people. :thumbup:

Should I trade my almost-new Cruze for an older Honda or something similar? I still owe about $7k on the Cruze and I consider buying it to be my third worst financial mistake. It's a great car but I didn't realize how much it SUCKS to be in debt.

I figure I could sell the Cruze for $10.5k, leaving $3.5k for the Honda. Something like this might work if it's in good shape:
https://albuquerque.craigslist.org/cto/4855866349.html

Here are the pros of each vehicle as I see it:

Cruze
Covered by warranty out to 100k
Free maintenance for another year
Maybe 10 years of useful life left
Nice, comfortable, quiet ride
More respectable vehicle

Honda
Save $7k up front
Faster
Maybe 5 years of useful life left

After the initial purchase, I think it would be a wash, financially. The Cruze will save me on maintenance costs but the Honda would save on insurance.

Thanks for your input! I'm leaning towards keeping the Cruze, but $7k would be nice to have.

BTW my two worse financial mistakes were selling my bitcoin stash at $40 (D'oh!) and not selling some solar stocks when they were up 400% in a year. (Bitcoin is dumb-- it wastes soo much power).

I'm casting my vota for the Honda. After considering the interest that will be payed on the Cruz I think you're looking at saving more than 7k. I respect a 20 year old car in great shape more than most new cars. You should also factor in investment opportunity lost by keeping the money tied up in the Cruz. That money could be grown in appreciating asset and be doubled in 5 years if things went well. My 2 cents. Good Luck!

What money? He is planning (hoping) to sell the Cruz for $10.5k, use the money to pay off Cruz and take the rest to buy a Honda outright. Leaving little, if anything, left to be invested. I'm not one to wheel and deal cars and would rather have a car I know the service history on than take a step backward into an older car that could result in becoming a money pit. I say stay the course, especially since the Chevy shouldn't cost you anything in maintenance for a long while. Higher insurance does suck, have you tried shopping around for a new company lately?

That being said, I love owning my cars. I buy them cash and never have to worry about losing one because I don't have money to pay my payment this month and save on insurance by carrying basic coverage. I should note that my Saturn cost $1,500 and my Focus just cost me $1,100 so I'm at a little bit of a different price point...

I'd keep the Cruze. Pay it off faster and save a little on interest. If you do shop around for insurance, look at Erie insurance. We switched a few years ago from progressive and didn't save much but our coverage almost doubled.

i think it really just depends on your immediate financial situation, if you need to get out, i think you should be looking harder at the 35mpg for under $1500 category.

http://ecomodder.com/forum/showthrea...mpg-30489.html

$3500 for a shiny '96 doesn't sound like that much better place to me than where you are in the long run. if you were sitting in a 20, or even $15k car right now i think making a move would be alot easier to justify, but owing 7k on a '14 anything isnt too bad of a boat to be in

What does the free maintenance cover? Most plans I've seen seem to cover oil changes and tire rotations, which would cost you maybe $50 to DIY over the next year. So while its nice, its probably not all that valuable.

We own our Prius, but bought it with a loan. Paid off the loan in under a year to minimize interest payments/time in debt. Having it paid off is great and I think going into debt for a bit to buy it was worth it for us over buying a cheaper car with cash. You just have to decide whether or not its worth it for you. I personally would try to find a Civic that has had less work done to it, if you decide to go that route.

But from that point on, he could invest the money that he would have been paying towards the car loan. He might not have $7k more in the bank after selling the car, but he could eventually have that and more.

Why would a 96 Honda have 5 years life and a Cruze only 10 years. No reason the Cruze won't last 20 years 300,000 miles. I had a 03 Malibu that was running strong minimal repairs(under $1,000) to 265,000 when wrecked a couple years ago.

How much are you going to budget for the Honda's replacement in 5 years?

If you have the 1.4 turbo, a few mail order parts and tune can bump the performance. 1.8 not sure what you can do.

If you can clear the 3.5k over the owed amount, then you are basically choosing a fairly new reliable car or an older more potential maintenance intensive car.

You're also stopping the act of renting some other persons money.

My $300 Sentra, at $1k now with all maintenance current, new tires and struts is down to 14 cents a mile after 7.3k miles and dropping steadily. Anamazingly reliable car so far but it could crap out any day, at least beyond the point where I would fix it, maybe. Fuel cost is 5.7 cents a mile.

If you are willing to go through the used car and get it up to snuff, then consider a muich cheaper car like a 97-01 sentra and you would have some money left over, in the car maintenance fund. Hondas need timing belts and valve adjustments, Sentras don't.

regards
mech

I'd ditch the Cruze for the same reason you want to, debt really sucks. I personally don't think having a fancy car is worth going into debt. You're in it for maybe an hour a day? Take the ~$300 you save a month, put it into savings (or investments). By the time you need to replace that $3500 Civic, you'll be able to pay cash for a much nicer car (if thats what you want), or buy another $3500 car and keep those extra thousands kicking around for whatever. If that Civic lasts you 5 years, you'll have saved 18k (assuming $300/mo saved for 5 years)!

As a side note, I also do all my own maintenance on my cars and don't mind fixing things when/if they go wrong which does happen with older vehicles.

But if the $3500 civic last 5 years then buy another $3500, why not just keep the nice car now and pay the rest of the $7000, interest rate should be no more than 3%, $210 in interest this year, even less in next. Insurance and registration suck for newer cars but will go down over time.

If he has 3 more years to pay on the $7000 that's just over $200 a month, in 3 year he can start putting that way and have a solid car payment free for a long time. Step up and pay $300 done in 2 years.

If cash today is a issue I'd consider refinancing it, $7000 for 48 months at 2.64% payment would be $154/month and $384 in total interest. The bank I use would even go to 66 months same rate. ($114/month $528 total interest) . Almost dumb to pay it off early as you can hopefully invest and make more than 2.64%.

How many more years will the 100,000 warranty last?

He still has $7000 to pay on the Cruze, plus interest. I assume that is the money that could be invested...

That will go a long ways towards maintaining the old car. Plus, with no loan, he is not required to have full coverage insurance for further cost savings.

I had car payments once and hated it. Loans on rapidly depreciating assets are awful financially. Never again.

That said, maintaining old cars is certainly not for everyone.

Everyone is going to have their own opinion of what you should do, but the only opinion that really matters is yours. Make a list of all of the pro's and con's of both situations and weigh your options based on that. If you want to know anything about a car that you may have in mind as a replacement for the Cruze, this is a great place to get that information. The people here can help you take a look at their personal long term maintenance costs of some of the types of cars you may be thinking of and you can use that information to help make your decision.

Good luck with your decision.

Good point on the full coverage insurance savings thats what another 1k per year?

He's already lost (WAG)$7-10000 in depriciation, done and gone, the only way to get it back is to keep it a long, spread that deprication out over 15-20 years, not a big deal, own a car since new or almost, know the history, know the maintenace, maybe not pricesless but hard to put a price on.

One of the worst finicancial mistakes I made wasn't buying a 2002 Montero Sport, but trading it off with only 55,000 miles. If my wife was still driving it today it would have been a good choice.

I actually enjoy fixing things, I just wish that I could afford it better! According to Blue Book, the value of my Civic was below $2,000 and I paid twenty-seven hundred. Over a thousand more is difficult to accept, but that had a great deal of work done to it. The dealership showed me a list of parts that they replaced on my Forester before I purchased it. Then my battery died and hoses and tires started rotting.

I still regret not having a full inspection done before purchasing my first car almost fifteen years ago. The cars that I had inspected did pretty well. I do not know what to think about Bacon, I remember specifically looking at the tires before purchasing, but one year later they started failing from dry rot.

How much less would you pay for insurance? Honestly, I think that is the most important detail. You really should be able to trust the Civic's engine, but there are plenty of other components, like the transmission, that are not necessarily worth fixing or replacing.

We would love to! Where are the pictures?!

I for one wouldn't buy that hx you posted. When there is a massive repair/maintenance job like that engine replacement, you have no assurance of how well it was done or if they're even telling the truth about the engine. People, even professionals often make mistakes. Stripped threads, wrong clearances, wrong torque values, using cheap parts, basically the whole 9.

But I'm all for beaters! Like the youtube show Roadkill (amazing show, check it out if you haven't seen it) I flock to beaters. If you're into saving money and not maximum mpg, that's where it's at. People will sell running cars for sometimes as much or less than scrap value. Then you drive for free. I paid $220 for my 1998 neon in 2007, it had 115k miles and a bad automatic transmission. It also was modified. I sold off the wheels, lowering springs, and cold air intake to end up with a free car. I then swapped in a five speed for under $100 thanks to a popular junkyard chain and it ran great! Over the years I have put more money into it, but nothing crazy. I even did the timing belt and water pump for $40 thanks to an ebay deal. It was a Pittsburgh car, I did the fuel line, evap line, and all brake lines with new fluid for $30 including one man bleeders. Rust free lines for under $2/ea at the junkyard.
Including replacing the seats, interior panels, major maintenance stuff but excluding oil/gas/taxes/tires I have less than $500 into the car. Over 8 years and 70k miles.


If you're going to buy a beater, be extreme and turn a wrench!

On the other hand, I think the Cruze is an incredibly nice car. Great safety, pretty good mpg, quiet and pretty big for a one person commuter. I would not recommend a cheap car to someone who can not do their own repairs.

Aside from a major design flaw or bad luck, I have total faith in the longevity of cars built since 2000. 150k miles should be nothing.

In the past and current, keeping a car with high miles has been good times. But with the incredible advances in safety and efficiency, I think those days are over for cars made today. Electric cars are making good leaps, both in efficiency and lower prices. It's just going to be a matter of time when gas is high again and electric cars are cheaper to drive.

Thanks guys. I'm gonna talk to my significant other and see if she has strong opinions. I'll probably just keep the Cruze for now. There's a cherry G1 Insight in Texas for $6000-some that will be attractive after I pay off a few more thou.

I think you're on the right track though. If I was you, I'd keep hunting autotrader.com, ebay, and craigslist for a deal.

The money that he's currently giving the bank every month. At the moment he has a car and has to make monthly payments on a loan with $7k in principal. After this swap he'll own a car... and not have any payments to make. Other costs will go down too.

That's not even a wash, it's a win. If he can sock away that same payment every month then instead of disappearing into the car he already drives, it'll be a pile of cash that he owns outright. It can go towards repairs if needed or eventually turn into a newer car, a pretty nice trick.

Or he can keep writing a check every month for the Cruze.

Get the Honda.

OK so I've been in contact with the Honda seller. It's been for sale for over a month now, so I'm sure I could bump him down a couple hundred $. He also says the cylinder compression was between 160-165psi on all four. Are there any red flags I should be seeing here? Think I'm gonna go for it.

*cough cough* I'll let you take over the payments on my 02 Honda Insight