I’m looking to by a car, and I’m trying to keep my expenses down. The other day, I visited a Toyota dealer and a Honda dealer to see what they had available in the “used but less than 50,000 miles” category. I’m looking for something that’s going to last ten years. I may not keep it for all of that, but I don’t want to worry about its reliability, and I don’t want to spend a fortune in repairs.
My old car, a Honda Civic (1997, not the 2004 linked) was really great, but so far I have a better feeling about the Toyota Corolla. I talked to the AAA auto insurance agent to get an idea the price of insurance. The problem here is that since I racked up a bunch of points, I’m considered a “high risk” driver, and will be for the next three years. Ouch.
If I were to own the car outright, without any loans, then I can get liability coverage for $2,150 a year. The price for high risk drivers is set by the state, so I can’t shop around for a lower price. If I were to take out a loan to get the car, I would be required to also purchase collision and comprehensive insurance. I’m not sure of the total, but it is likely over $4,000 a year.
I was set in my mind that I would pay for the car out of the cash I have saved up, thus not needing to bother with the loan. My father seems to think that I would be better off getting a loan instead of using all the money I have saved up, getting the extra insurance so I don’t have to worry about setting money aside for car emergencies, and buying a new Hyundai for about the same price as a used Corolla.
I’m not sure that his advice makes the best sense. So, this is one of the rare occasions I’m looking for thoughts (not advice) and opinions (not correct answers). Anyone?
I have the same problem with points, and recently went three years without any, but have a ticket court date coming up (damn!). Look at NJ Cure, they will still insure higher risk drivers, and their rates are better.
I must say that Hyundais don’t thrill me, but I believe that they come with a stoopid good warranty, and I know a few people who have them and generally like them, and have driven them for a long time.
I don’t know about the insurance, but you might want to look into a financing option like GM’s “Smart Buy” (http://www.gmacfs.com/automotive/smartbuy.htm).
Hyundai is not a good car for the money you will spend. If you’re not gonna stick with a Toyota Corolla, take a look at the Echo. It’s as basic as you can get but it’s cheap and reliable. Also, you could take a look at a Saturn. If I were in your shoes though, I’d buy a car outright that comes with some sort of warranty. For instance, most used cars off of a Toyota lot have a warranty up to 100,000 miles and considering you don’t do the traveling that you used to, that should keep you covered for a few years which would enable you to build up your nest egg again.
I’m kinda with Neese on that one. How long would it take you to build up some saved money again? It would probably take you even longer if your monthly expenses were increased by the difference in the insurance. Also, you kinda saved that money for exactly this kind of reason. In the end, though, you have to do what makes you comfortable. I’m pretty sure you wouldn’t be comfortable driving that Hyundai.
In my experience, debt breeds more debt. I always think that it’s better not to take out a loan if you can. If you buy a car, you’ve exchanged your monetary value for an asset of the same value. If you take on a loan, you haven’t acquired an asset, but you *have* acquired debt. Also, I’m a Honda girl all the way. My dad will buy a honda with over 70,000 on it with no qualms at all. They’re great cars. That’s just how it is.
NJ Cure wouldn’t work for me because of the no-suspension-in-last-60-months requirement. Oops.
yeah i hear hondas are good – but my car is basically a corolla (with a geo nameplate). my car has 128,000 miles and is running strong (knock-on-wood). i think the buying it outright is good if you can afford it- then you don’t have to deal with the monthly payment thing. yeah.
I love my VW Jetta… I’m on my third one and even convinced my fiance to buy one (after we had only been dating a month!). Jettas run forever, are fun to drive and are waaaay more stylish than a japano-box… By the way, we’re selling my fiance’s 1998 Jetta VR6 (leather, sunroof, mmm-mmm good!) because, since we moved up here to the frigid wasteland of New Jersey, we do not need two cars.
The problem with VW’s is that they are unbelieveably expensive to fix when things go wrong. Parts are extremely expensive and the way that the engine and what not are set up inside, it’ll cost hours in labor as well.
According to edmunds.com’s True Cost of Ownership calculator, over the course of the first five years, maintence and repairs on a 2003 Toyota Corolla cost $3,920, on a 2003 Volkwagen Jetta they cost $3,699, and on a 2003 Honda Civic they cost $3,446. So it looks like over the first five years of ownership, maintence costs the most on the Toyota Corolla. I compared the 4-door medium-option sedan models of the cars.As far as total cost of ownership goes, the Corolla is $24,853, the Jetta is $26,001 and the Civic is $23,670.The Civic still wins on all counts.
I’m not arguing with you on the civic, it’s a darn good car. If I didn’t have a Toyota then I’d have a Honda. I just lucked out that I get my car for essentially manufacturers cost and I got parts for manufacturers cost and the labor is whatever I feel like paying my brother. Interestingly enough, this offer can be extended to family and friends.
I’m curious about something with that whole cost of ownership chart that you’re looking at…..do they take manufacturer’s warranty into account? Because, it seems to me that with a new Corolla (or Civic, or whatever), you generally get about 3 years on the warranty. So, if in the first five years your estimated repair costs are $3,920 on a Corolla, it implies that you’ve either got almost $4000 in repairs in the 4th and 5th year, or that there are a number of non-warranty repairs that happen in those first three years (which, as far as I know, should be rare). Either way, that number just doesn’t seem right to me when the warranty is taken into account.
It looks to me like they’re not taking the warranty into account. This is what they said about maintenance:
This is the estimated expense of two types of maintenance: scheduled and unscheduled. Scheduled maintenance is the performance of factory-recommended items at periodic mileage and/or calendar intervals. Unscheduled maintenance includes wheel alignment and the replacement of items such as the battery, brakes, headlamps, hoses, exhaust system parts, taillight/turn signal bulbs, tires and wiper blades/inserts. Estimated tire replacement costs are supplied to Edmunds.com by The Tire Rack, Inc.
Okay, so, they’re not taking into account warranty, but they’re also not taking into account any repairs that would be covered by warranty, anyway. They are, however, taking into account the regularly scheduled maintenance, which not everyone does. But it makes sense the way that they did it…