And it’s time again for my monthly car rant, the game where I show you, the readers, how buying new cars and getting car loans is single-handedly keeping the middle class broke.
For those that aren’t familiar, feel free to review a few of my favorites, including:
- You Don’t Need A New Car
- Things I Couldn’t Do If I Had A Car Payment
- How To Buy A Used Car Like A Boss
- Wisdom About Cars From My Grandpa
- We Only Drive Fancy Cars
And of course…
Today we’re going to tackle the ridiculous idea that “cars with high mileage are too unreliable and cost too much in repairs.” This crowd is my favorite bunch, because it’s usually accompanied y a sort of whinyness that only people who waste gobs of cash on cars have.
And this post isn’t going to be accompanied by stupid averages that don’t actually apply to real people, but with cold, hard facts from my own experience and that of my family and friends. So sit back, buckle your shiny new seatbelt, and prepare for a kick in the muffler!
The Typical Life Of The Average Car For One Owner
Again, I could site studies and such that show the average life of a car, but that’s just not the real world. What I want to talk about is the average life of a car for one owner. So here’s a fun re-enactment of the relationship between man….and machine!
Bob: “Hi dealership guy. Phew, glad I made it past all those hoodlums and thieves from Craigslist to a place of real honesty. Now, can you show me a car that will probably work for my family, but gets you the highest commission? Oh, and make sure you tack on undefinable fees for another few grand and a warranty that I don’t really need.”
Sales Guy: “Perfect. Now, if you could sign here and here and here and here. Oh, and don’t forget here for the auto loan that doesn’t let you feel the pain of how much you are actually wasting on this depreciating hunk of metal. It’s a great interest rate over 7 years! But don’t forget to trade it back in for a ripoff price before the loan is finished so we can keep you chained to the neverending misery of financing an investment that loses 10% or more of its value every year. Oh….and here’s some crappy free coffee.”
Back at home….
Bob: “Man, what a great deal I got. Can’t wait to tell everyone about it!”
2 years later….
Bob: “My car is a car.”
5 years later…
Bob: “Wow, check out the shiny new model. It even has some feature that doesn’t really matter, but my current car doesn’t have! I NEED THAT FEATURE! Plus, the battery on my key fab is running low. I can’t even pop the trunk without using the real key anymore. Yup, this hunk of crap needs WAY too much maintenance. What a money pit! Time to go visit my buddy Mr. Sales Guy…”
Back at the dealership….
Bob: “Mr. Sales Guy, my car is old. It has over 100,000 miles on it, it’s probably about to implode. I need something with LOW MILES, otherwise I’ll keep wasting a bunch of money on my car, and that would suck.”
Sales Guy: “Bob, I have the perfect vehicle for my commission. Come check it out!”
The Typical Life Of A Car In My Household
Jake: “Hey Mr. Craigslist dude. Thanks for showing me your car. I’ve already done a ton of research of this model, because Google is so easy to use. I searched your car out because of the features, lower miles (under 250,000) and overall look. Let’s take it for a test drive with my mechanically inclined brother so we can make sure the engine, transmission and suspension are in good shape.”
Craigslist Dude: ”Sure thing. Let me know how much you think it’s worth, as my prices are flexible, and the buyer has all the leverage. I’m just trying to get some money out of it to pay for my minivan that I just bought.”
Jake: “Cool. It’s in good shape, but the issues here, here and here show me it’s really worth about 70% of your asking price. I’ve got cash. That work?”
Craigslist Dude: “Seems fair.”
Back at home….
Jake: “Got a smokin’ deal on this ride. And since it’s a Honda or Toyota, it’s got another 100k miles in it easy. Plus, I bought it 15 years old, so it’s not depreciating anymore.”
2 years later….
Jake: “Ride is still sweet, maintenance has been low, and still getting great mileage.”
5 years later…
Jake: “Still daily driving this awesome machine. 250k+ miles and runs like I just drove it off the showroom floor. Gunna keep driving this until I want something else to play with.”
The Car Maintenance Myth
There are too many people who make car purchases based on fear. I have said this from my first car post, and will continue to say it. Cars with high mileage (over 100k miles) don’t need more maintenance the new cars to keep them running reliably. Let’s compare Bob and Jake above.
Bob did the “smart” thing and bought a lightly used car with low miles (40k) for $18,000 financed at 4% (for a total of $20,667 after interest). He also spent another $3,000 for the extended warranty to take care of any maintenance. Great move! He had the oil changed 20 times, replaced his entire braking system (recommended), got 4 tune ups, new suspension parts, new tires, timing belt replaced, and a bunch of other junk. His warranty covered it all, but he paid the $50 deductible 6 times. Out another $300. BUT BETTER THAN A CAR DEAD ON THE SIDE OF THE ROAD! Car is now worth $8,000.
Jake, in the meantime, bought a car with 204k miles on it for $1,600, and was prepared to keep the car maintained himself (with a socket set, an oil pan and a car jack). Over the 5 years, he changed the oil 15 times ($225), replaced the brake pads and rotors once ($300), tuned up the car once ($75) and replaced a broken taillight ($10). His crazy “money pit” car cost him (HOLY CRAP!) $610 in total maintenance. Even if Jake got lazy and had the local lube shop change the oil, he’s still only out $800.
Used Cars Are Not Money Pits. New Cars Are.
Now, Jake’s (my) story is real. I have owned several cars over 200k miles and keep them running smoothly with the least amount of work possible. I drop in $100-$200 per year for maintenance, and my cars have performed well, and still sold for nearly the price I bought them for years earlier.
I strategically buy 15-20 year old Hondas and Toyotas for $3,000 or less, drive them for 5-7 years and sell them for what I bought them for (or more!). The cars usually get 30+ MPG’s and are fun to drive. The maintenance is minimal, and sometimes even less than newer cars, because they are less complicated.
Every time I post about buying used cars, someone inevitably asks about maintenance, and how at some point, it’s worth it to just get a new car because of how much money is dumped into keeping that used car running. And someone else usually has a story about how their transmission blew and it was going to cost $3,000 to fix, so they scrapped the car and bought new so it wouldn’t happen again.
What they SHOULD have done is just bought a better used car, and learned from the first one. It’s usually some kind of dodge or kia or something that died, so don’t buy that crap anymore. Buy a used Honda or Toyota. Bring a mechanic friend along and make sure the tranny isn’t jacked up. And, for the love of automobiles, PLEASE GO HERE FIRST BEFORE BUYING A CAR! Type in “common issues with (your desired car)” and find out in 2 seconds something that could save you thousands.
Our Cars Are Still Running. Why Would We Buy New?
In my family, here are the top mileage cars we have owned and driven until we sold them or parked them. These cars all still run/ran, and don’t have any major mechanical issues.
- 1986 Honda Accord – 370k+ miles
- 1994 Honda Accord (my daily driver) – 300k miles
- 1994 Honda Civic (sold) – 276k miles
- 1985 Celica GT-S (sold) – 200k+
- 1987 Supra Turbo (sold) – 200k+
And for extra fun, here’s a video of me hitting 300k miles this past weekend in my Honda (don’t try this at home).
I don’t see a reason to buy a new car. Our used cars have proven nothing but reliable with a little TLC and maintenance. Why would I spend $24,000 on a car now worth only $8,000 when I can spend $1,600 on a car now worth $1,600? The math always wins, and now you know the maintenance isn’t even a factor.
Happy car hunting