What do you do when you have a gas guzzler, but it doesn’t make good financial sense to buy a new car?
I’m in that position. However, gas prices are making it more and more economical. And my commute is such that it might almost make more economical sense to get the new car.
I did the math yesterday and it appears that I can reduce my gas cost from $60 once a week to a total gas bill of $60 a month. And I suppose I can use that extra $180 a month to pay off a car quicker. And there’s that whole tax incentive thing.
Usually I jump right into doing something to help the environment, but adding a car payment to my monthly bills sort of makes my stomach turn.
What would you do?
Here is a good resource I found in my research.
- Lindsey
May 3rd, 2008 at 1:57 pm
Lindsey,
Here are factors to consider:
1. your insurance will go up on a new car
2. the car will lose value the minute to leave the sales floor
3. you will lose interest on the money to pay to a finance company
4. you will have to immediately tag, title and pay the excise tag on the new auto–how much depends on the cost of the new auto
5. the chances of your applying any gas cost savings to the payment are slim to none since we all see things we want and that extra money you THINK you have to be too handy
6. figure all the above costs into that payment, then look and see if you are actually saving money on a new car. I do not think you will see any savings–but you will see lots of your money going to others
7. put the tax incentive into a saving instrument and when you save enough to purchase a car outright without financing it–buy a hybrid or electric
good luck,
Karen Ortwein
Moore