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Trading in VS long term ownership


KARNUT
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In my house we have different ideas regarding vehicle ownership.  If my wife likes her ride she keeps it. I get bored with whatever it is I like to trade off. Of course good credit is key as with anything. Currently her ride a Genesis is going on 11 years old and cost sits at 300 per month get less each month. In contrast I’ve had 5 new, used now sitting at 300 per month. No major expense never more than 450 per month payments starting either process. I could go back 40 years adjusting for inflation. For me in my conclusion. Buying deals every couple of years and doing general maintenance is better than sweating longevity. I generally never had to do even brakes, some even tires. Thoughts?

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My parents tend to buy new and keep cars 10-15 years. The longest term vehicle they've ever owned is their '03 Chevy Avalanche as it just keeps going, but they recently had some age-related repairs that were a little bit expensive to resolve (new fuel tank mounting straps as the old ones rusted out, 7-pin trailer wiring stopped working, water pump, yet another set of brakes, etc.).

 

They did confide in me and say they regret keeping some vehicles as long as they did due to repair costs eventually going up while value goes down, however. My take on it is if your vehicle doesn't give you any trouble during the warranty period, keep it for a year or two after it has been paid off, then evaluate your options from there, weighing the vehicle's value and upcoming maintenance costs. If your vehicle has had multiple issues during the warranty period, I would get rid of it right before the warranty runs out. If you negotiated in an extended warranty, that buys you a little more time, but you still need to weigh non-warranty wear items like tires and brakes as well as the vehicle's current value.

 

Our '21 Silverado has had a bunch of issues from day 1 including the dreaded lifter failure and it's definitely getting traded in prior to 5 years/60,000 miles, but at least I didn't have to pay to fix them due to warranty coverage. I feel a lot of newer vehicles are engineered to last the duration of the warranty and no longer so I don't feel that a 10-15 year span of ownership is financially practical anymore, sadly. If the lifters on our truck need replacement again, but out of warranty, it'll most likely be a $5,000+ job. No thanks.

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Assuming fuel cost is a wash (I don't know if you included that in your monthly cost), insurance premiums cost more based on the replacement value. Also I know some states charge annual plates/tabs based on vehicle value (Wisconsin doesn't so I'm not too in tune with that.) Everyone knows depreciation is worst in the first year. Now the last year has been a bit crazy, but I'm talking in general.

 

That said, it is definitely cheaper to operate an older vehicle. You can debate the monthly payments vs regular maintenance, but keeping a vehicle for several years after its paid off always puts you ahead. 

 

Some people value having their ride under warranty, so always paying a monthly fee gives them peace of mind. I don't believe that is worth it in the long run, but its a personal choice.

 

I have an extra vehicle so if one needs work, I'm not stranded. I have owned my vehicles for 8+ years on average and I don't plan to stop that trend. My wife would prefer a new one about every 5 years.

 

Purely from a money standpoint, I think it is wisest to own vehicles around 4-8 years of age. Some people are more trendy than I am though. My 2014 Chrysler 200 work beater is bare bones, less to go wrong. Give me an FM radio and a heater and I'm good to go.

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1 minute ago, aseibel said:

Assuming fuel cost is a wash (I don't know if you included that in your monthly cost), insurance premiums cost more based on the replacement value. Also I know some states charge annual plates/tabs based on vehicle value (Wisconsin doesn't so I'm not too in tune with that.) Everyone knows depreciation is worst in the first year. Now the last year has been a bit crazy, but I'm talking in general.

 

That said, it is definitely cheaper to operate an older vehicle. You can debate the monthly payments vs regular maintenance, but keeping a vehicle for several years after its paid off always puts you ahead. 

 

Some people value having their ride under warranty, so always paying a monthly fee gives them peace of mind. I don't believe that is worth it in the long run, but its a personal choice.

 

I have an extra vehicle so if one needs work, I'm not stranded. I have owned my vehicles for 8+ years on average and I don't plan to stop that trend. My wife would prefer a new one about every 5 years.

 

Purely from a money standpoint, I think it is wisest to own vehicles around 4-8 years of age. Some people are more trendy than I am though. My 2014 Chrysler 200 work beater is bare bones, less to go wrong. Give me an FM radio and a heater and I'm good to go.

It was simply taking the purchase cost and subtracting the months of ownership new and used. Paying cash or payments. Usually at o percent. Right now I’m neck and neck with my wife. The vehicles I had were in the time period are, 2010 Genesis coup, 14 GMC, 15 Santa Fe, 17 Camry the current 02 Avalanche. Our toys we’re not included. Weren’t daily drivers or driven in place of. 

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25 minutes ago, KARNUT said:

It was simply taking the purchase cost and subtracting the months of ownership new and used. Paying cash or payments. Usually at o percent. Right now I’m neck and neck with my wife. The vehicles I had were in the time period are, 2010 Genesis coup, 14 GMC, 15 Santa Fe, 17 Camry the current 02 Avalanche. Our toys we’re not included. Weren’t daily drivers or driven in place of. 

When the wife is ready for a new or CPO it will be from the Genesis, Hyundai family. The warranty is 10-100K. She claims it’s still awhile off. It’s still new looking.

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55 minutes ago, diyer2 said:

My last truck I drove for 20 years. 1993 Silverado. Bought used.

🙂

 

Bravo!!

 

I keep them until there is nothing left (rust) to hang parts on. Most of the time I've been blessed with vehicles that last 20+ years of very trouble free service. Yes, I've had a stinker to two and no I still didn't give up on them until they give up on me. That blessing is a result of a good PM program. One I learned at fathers knee and refined with 50 years driving/building/racing experience. 

 

Vanity is not part of my car buying equation. I don't believe in false economies. I rarely buy new. Twice in fact in my life and in both cases the 'deal' is what I bought. A deal that to buy new was cheaper than a two year old low mile purchase. Both were bought at or below 'auction' price missing entirely the first year depreciation. 

 

I look at the vehicle as a transportation device. Not a gaming center or office or music hall or a cup holder for six or a makeup table or communication center or ___________________.  It moves me from point A to B without causing discomfort or undue stress. The less it has the better I like it. A few notable exceptions. Cruise control is a must anymore. 😉 

 

There is no cheaper vehicle to own than a paid for well maintained one. Anyone who decides buy a $50,000 vehicle because a brake job on his current ride cost $1,500 or a motor cost $7,000 in an otherwise sound vehicle is looking for a reason to own something 'different' not cheaper. 

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As always spiteful and contradictory. All opinions are welcome. One wonders though. How many vehicles do you have in your fleet? Don’t we park pepper in the winter? What about that Buick? Frugality only works if one is truly frugal. As usual you way is the best even if you don’t practice what you preach. I didn’t say my way is gospel, it suits me. I don’t condemn people choices, my mother drives a 20 year old diesel. Can afford a Mercedes. Choices not condemnation.

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When I was younger, I tended to get a new (either new or used) car about every 2-3 years.  I think it was mainly driven by seeing cars and trucks as toys, versus tools.  When I bought my '07 Yukon (new), I bought it for a specific task and it turned out to be the perfect choice for my needs, both as a tool and as a recreational vehicle.  That truck changed my buying habits in one fell swoop.  

 

Now I am a buy and hold kind of car owner.  I just bought a new 1/2 ton Sierra and likely will own that truck until they take my drivers license away from me, so yes, definitely a long term holder.

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A vehicle is a must have tool. I also look at the time of use. It sits the majority of the time so I prefer to have as minimal an investment as I can to have it sit.

 

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I’ve been on both sides. For the longest time if you bought a full sized truck “right” new, you could trade every couple years for small money. I just swapped my ‘19 Silverado for very near what I paid 2.5 years ago. Actually had offers for more than I paid but the timing wasn’t right.

 

Unfortunately looking at the big picture, things are changing in the post-Covid supply and inflation world. Deals on new trucks “off the lot” are gonna be hard to come by with the manufacturers pushing custom orders. 


Also considered this latest push for EVs and realized something like the TRX isn’t going to exist in a couple years. So I took a leap and bought one at MSRP. I’ll likely keep it around forever. As a daily  and work truck through the warranty, and as a toy / collectible with some HP modifications after. I’ve been meticulous with maintenance on it thus far for that reason. Catch can from day one. Put Redline oil in the engine and diffs, and will change on shorter intervals. Not going full Grumpy but I feel there are little things I can do to ensure it lasts even when I turn the wick up.

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I tend to keep my vehicles until I get tired of them and trade them in every 2-3 years. My only exception was my last truck that I kept for 12 years until I traded it in last fall for a new truck. I loved that truck but then it started to cost me money and I was losing interest in it, so it was time to sell and buy a new one. I have been buying new since I could afford it. 

I have always been a car and truck guy. The way I look at it, I could spend my money on far worse things. 

 

It's all about personal preference and I don't think there is a right or wrong answer. 

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  • 2 weeks later...

Personally, I enjoy variety, but I enjoy that in ways that are mindful of transaction costs and the value of the vehicles I'm buying/selling/trading. Just have to do it smartly, on the right vehicles, it can be done without losing or spending a lot of money, but it's still an expense. And so is hanging on to an older vehicle and driving the wheels off of it.

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