I'm so upset and I need to vent...

[descovy]

Not a Dave Ramsey follower... just my own un-common sense

First, I'd try to get by with one car as long as possible. You might be surprised how far you can go with a little creativity.

Beyond that, I'd get a reliable newer car. Pay a bit more, but forgo the bells and whistles.

Can you swing the payments on a 60mo loan? If so, I'd get the 60 month loan but pay it down as quick as possible. No one says you can't treat a 60 month loan like a 36 month loan.

We do this... ease of a low payment whe we need it, but pay off early. We pay $500/mo on a $300/mo loan. The extra goes toward principal. Not only that, but the payments extend out... currently we are 6 months ahead, so in a bad situation we'd have 6months before we needed to make a car payment.

I don't fear credit. I try to use it wisely. But I DO fear losing $4000 in liquid savings. Cash is king in emergencies. If I had to choose between $4000 of debt (reasonable intrest rate) that I could pay in smaller installments or $4000 in the savings account (emergency fund) I'd choose the emergency fund.

And $4000 for a new motor won't be the end of the repairs on a 140,000 mi car. A/C, tires, brakes the list goes on on the things that have parts in their end stages of use.

 

[laurafergie]

I would purchase a used car for the money that it would cost to fix the old car. We just bought a car for under $5000 and it has worked out great...it was hard finding such a great deal, but it is possible.

Absolutely.

ETA: You could replenish your savings with the money you would have spent on a car payment. It's a great feeling knowing your car is paid for.

 

[RN01]

My father works for Ford and the employees that do not drive Ford vehicles to work must park is a very far parking lot...they also run the risk of returning to their cars every day and finding the air has been released from their tires on a daily basis. Dad says those guys usually come to work with a new Ford vehicle within a month. Thankfully, my Dad doesn't get involved with such things, he doesn't care what the guys drive, so long as they show up to work.

.

No my hubby doesn't have to park in a different parking lot than everyone else. I hadn't even heard of this untill one day when we were driving by a GM plant in Indy and there was a parking lot of "other cars" I can't remember how it was worded but it was just strange and funny to me. I just feel like since he works for Toyota he should buy Toyota. If would be weird to buy the competetion. I think we've decided to keep looking untill we find something in the price range we are wanting. Wish us luck! Oh by the way, our disney vacation is mostly paid for so don't have to worry about that!

 

[Duckiedee]

I look at this a little differently. Especially when a car is paid in full.

First off - I would definately check AROUND to find a good repair person - it is not always the dealership who is the cheapest or the best. Word of mouth is definately your best bet. Even many small reputable companies will offer some type of warranty. I'm sure you are already doing this

Rely on one car until you can find a price in your budget.

Even at $4000, how many NEW car payments is that? Especially if a car has not cost you a lot in payments at this point and you bought it for a used, reduced price? If you can even put off a new car payment for a year or two - you will have save MONTHS of car payments - in fact - put away what you would have been spending NOW on a car payment until the car breaks down next... and you will be ahead when you need to repurchase.

Just because a car breaks down once - does not mean it is on the way downhill. We had to put our first ever repair-style maintence on our vehicle a year ago at around $2000. Sucked - but that would have been around 4 car payments and here we are 8 months of NO payments we would have been paying for something new we obviously really didn't NEED.

Our car still has no end in sight. Buying new does not equate a better investment. It depreciates SO badly once you drive it off the lot. And by the time you pay the darn thing off, if you aren't paying cash up front, you are starting to look at repair issues again a year or so after it's finally paid in full if you do take five years. So it's the same rollercoaster.

I'm all about making the darn thing last until it is so rusted it is embarassing to drive or repairs become more than the actual payments over a several-month rotation. You can also get the mechanic to give you an assessment of the soundness of the rest of the car before you make the decision. And sometimes you can get a great engine at a autowreckers where the engine is sound, but the vehicle has been rearended or similiar. Depends on how much to want to make a 'game' of it. LOL. The gamble can definately pay... it always has for us. Obviously you want to make sure things are safe.

If you decide to go with a newer vehicle - I'd consider payments on a used car a little over my budget vs payments on a brand-new car just because it is a better investment since it has already done the bulk of depreciating when you purchase it. Seriously, get around with one vehicle until you find something - it may take a few weeks or a month... but it is so worth the savings.

We often buy our vehicles with less than a couple of thousand on them with savings/investment income, save around $5000-7000 since it's not new/new and drive the darn things for ten years. Right now we have a 1997 (had 900km) and a 2003 (had 4400km). DH would love to get something new - but like you - we loathe those payments, so we are waiting and saving. When one really, TRULY quits, we'll purchase. I don't think we've had a vehicle payment since maybe '94?

Definately worth the repair in my books for the long run money-wise. A car is just transportation - it gets you to and from as long as it runs, is safe and you're not falling through the floorboards you're golden.

It is NEVER a good investment unless it is an Antique, Classic or a WAY over my budget one-of-a-kind Lamborghini! LOL.

 

[yoopermom]

I haven't seen it mentioned here yet, but please consider picking up rental on your insurance. We pay less than $25/yr for it, which is only the cost of one day of a rental. When I got hit last year, it took them awhile to fix my car because it's a Subaru (and that must be an endangered species, because my parts took FOREVER to get here), and I used that rental car for almost a month (and drove 90 miles each way to work each and every day!). Well worth the $$!

Good luck on your decision, whichever way you go. My DH is handy, so we've had engines replaced in many of our vehicles and still driven them for hundreds of thousands of miles...

Terri

 

[rock_doctor]

Is it a manual? If so then replace the engine with a remanufatured engine from any of the normal reman companies such as Jasper or even the original manufacturer of the car. These all would come with a warranty. I would call around to your local garages and see what they want for the labor, the engine and i would add a $1000 to that for misc items like a water pump and radiator. If you are really strapped for cash then look for a low mileage engine from a junk yard. Here is an online search engine for junk yard parts http://www.car-part.com/. Search for the engine and see what is in your area. It will also give you an idea cost. By the way almost all non-electronic parts that come from junk yards come with a warranty. good luck

 

[tar heel]

I put a low mileage (18,000) junkyard engine in my 2000 Grand Caravan in 2004 for $2,400. The vehicle now has 198,000 miles on it and is going strong -- obviously made the right decision.

It had about 70,000 miles on it at the time, though, instead of 140,000 - not sure I would have done that kind of repair if it had had twice as many miles.

 

[brymolmom]

Not sure what I would do on buying or fixing...but wanted to say - if you DO fix it - is there no way you could share a vehicle for a few weeks? I know it might not seem easy - but it could be worth it. COuld one of you get up really early and drive the other to work....is there no one in your basic area that dh could carpool with (offering $25 - $40 a week in gas money depending how far it is to the office) or if he can't carpool - can you? Is there a family member you could borrow a car for at least part of the time?

 

[VAN]

I thought rental coverage was only if you were in an accident ... not just if you needed to fix something that broke. Am I wrong?

 

[sorul82?]

Following financial plans that are explained in books is great, but unless you are working with a personal financial planner, there is no way to account for the unique individual needs a family encounters.

Dave always get me with the "sell your car with the high payments and get a beater car." I'm the crazy person screaming at the radio, "if you sell your car today, how do you get to work tomorrow?"

 

[allison443]

I thought rental coverage was only if you were in an accident ... not just if you needed to fix something that broke. Am I wrong?

I thought the same as you, but maybe some policies allow for repairs as well as acccidents?

 

[Duckiedee]

Dave always get me with the "sell your car with the high payments and get a beater car." I'm the crazy person screaming at the radio, "if you sell your car today, how do you get to work tomorrow?"

In the beater car.

 

[sorul82?]

In the beater car.

That's what I don't get. You have to save up the money you were spending in car payments to buy the beater car.

 

[Suz D]

I haven't seen it mentioned here yet, but please consider picking up rental on your insurance. We pay less than $25/yr for it, which is only the cost of one day of a rental. When I got hit last year, it took them awhile to fix my car because it's a Subaru (and that must be an endangered species, because my parts took FOREVER to get here), and I used that rental car for almost a month (and drove 90 miles each way to work each and every day!). Well worth the $$!
Terri

I'm not positive, but I believe rental insurance only covers you when your vehicle is in an accident, not for mechanical problems. You have rental insurance only for something that is covered under your auto insurance and mechanical problems aren't covered under auto insurance.

 

[Duckiedee]

I see what you are saying. Still, if you purchase a beater car in four/six/10 payments (because you don't have enough money aside to buy one used) instead of 36 or 72 payments - you keep a lot more of your money. You just want to make sure you get a sound, reliable 'beater'. During the time you would have originally been making new cars payments, the best solution is first to pay down high interest debt using the car payment you do not have, then invest the payment or set up some kind of savings with it.

I have nothing personally against new cars... but they are really not a very sound 'investment' when you are talking about your money and what it can be doing for you.

MY OPINION. Is that it is better to put off purchasing a new car until you can pay for it in FULL - until then, purchase used. You will be so much farther ahead in the long run financially. New cars, I find, are the second worst money-sucking drain on the wallet next to non-investment debt.

OP - sorry I've gotten off topic here! I DO LOVE talking about making money work though!

 

[bettymae1121]

We just put a new engine in my DH's truck last month. I priced it out, and the engine was half the cost of getting a similar truck ($5k vs. $10k). It was a lot of money, and I was nervous. But the new engine install went great and DH says the truck runs better now than the day he bought it, we should be able to keep that truck for at least another 10 years, so we'll get our money out of it.

Then again, we had the advantage of being able to share a car while the truck was out of commision, so we didn't have the cost of a car rental to contend with.

I hate car payemnts too, but sometimes you just have to bite the bullet. DR is great but sometimes life throws you things that just don't fit into his plan very well. If you do decide to buy new, buy the cheapest car you can get away with and finance it for as short of time as possible, but DON'T set your self up with such high payments that you don't have any wiggle room. You can always pay extra towards the car and get it paid off early if you find yourself with extra money later on (just be sure your loan doesn't have a pre-payment penalty).

 

[Sadie22]

I thought rental coverage was only if you were in an accident ... not just if you needed to fix something that broke. Am I wrong?

Some comprehensive mechanical breakdown insurance policies cover the cost of a rental car while a vehicle is being repaired, along with towing, battery jump-start, etc. That is separate from insurance liability coverage which would provide a rental car for the victim of an accident while his/her car is being repaired. Some dealerships used to offer loaner cars to their customers while vehicles were being repaired, but that is probably no longer available anywhere.

 

[sorul82?]

OP - sorry I've gotten off topic here! I DO LOVE talking about making money work though!

Me too! I love reading everyone's ideas!!

 

[Brancaneve]

Ahh...you only live once! Get a more expensive car and finance the rest!

 

[Amandaj0831]

We went through this about a year ago and chose the fix it option which was ok until something else broke pretty shortly after and then again pretty soon after. (this was a 2002 accord). When cars hit a certain point they just cost more to maintain and when you fix one thing another one breaks. Ultimatly we drained the savings and then ended up having to get a new car. We found a great used Toyota van within our price range within a weekend. We gave a few car salesmen what we wanted and one called as soon as a trade in drove in. I drive alot of miles to work so a beater is not a better deal to me I have to have reliable transportation. Good Luck