Should I get rid of my old car?

I bought my 2000 Mazda Protégé days after I moved to Ottawa from Toronto. My Mazda was brand new and cost about $16,000 right off the lot. I recall I used my credit card to make a $500 down payment the day I bought it. (Don’t gasp financial people, I did pay off my credit card that month.)

My Mazda has been paid for since 2005, 11 years ago. Most people don’t own a car as long as I haven’t had car payments for this vehicle. This car doesn’t owe me a nickel. It’s been a worthy ride for many years and it could likely stay on the road even a few years longer.

Which brings me to this…should I get rid of my 16-year-old car?

Mazda Car

Let’s start with what’s driving my decision (pun intended), to potentially get rid of this car:

  • I want a new car – I drive by no less than five car dealerships on the way to and from home many days and over time, I feel like I’m getting drawn towards the shiny, newer, metal objects on those lots.
  • The price is right – I’ve seen 0% financing at many car dealerships, so the idea of dirt-low borrowing costs is appealing; I intend to keep my new(?) car for at least 10-12 years (like I did with this one).
  • I probably need something more reliable – although I don’t drive my old car very much anymore, including a few times per month in the winter, I need something more reliable when I do. My neighbour had a good laugh last year when I had to push my car out of my garage, to get it started by CAA.

Let’s look at why I should consider keeping my old car…

  • It runs fine, for the most part – OK, so over the last few years, I’ve pumped a bunch of money into it to keep it on the road and I need CAA now and then. But doing the math on this, I’ve averaged less than $300 per year in recent years in maintenance costs, and MUCH less than that over the life of the car.
  • I save on insurance – I’m currently paying $50 per month to insure this car.
  • I get good gas mileage – this lil’ four cylinder sips gas.
  • We already have another car payment –  enough said, although that car payment will be done in another 9 months.
  • I rarely use it – as a secondary car, I probably drive it a handful of times per month. It pains me to think about paying for a depreciating asset, sitting in the garage, that I’m not driving very much.  So, we’ll probably make the new car the primary car and the current vehicle we have the secondary car.

I think a new car deal with 0% financing, an economical and affordable car that continues to sip gas, with the intention to keep the car for at least a dozen years, might be the route I will take but I’m really not sure.  Does it have to be a new car?  Maybe a 2-year-old used car is a better deal?  The challenge is we don’t have enough money saved up yet for a sizable downpayment on a used car and therefore we would need to borrow money on our line of credit at roughly 3.2%.  Lastly, why get a newer car within the next year at all – should I hold out a bit longer?

I’m rather attached to this old Mazda.  I’ve had it for so many years and I take great pride in keeping it roadworthy for so long.  It’s been good to me.  Keeping this old car has also afforded my wife and I to do other things in life (instead of making car payments).  That includes more international travel and completing renovations around our home.  Lack of another car payment has also accelerated our early retirement journey.

Needless to say I’ve got some thinking to do this year.

What would you do?

76 Responses to "Should I get rid of my old car?"

  1. If I was set on getting a new car I’d probably aim for something 1-2 years old with low kilometres. I say this because people trade these types of vehicles in for something brand new and dealers have much more wiggle room on these, especially if you’re trading something in. You’d basically be negotiating on the difference between your current car and the new one, with your goal to make the difference as small as possible. Extras like heated seats, hitch, upgraded stereo, new tires etc are all available for the dealer for cheap, so if a car that’s 1-2 years old is missing something you want (ie. heated seats) they can easily add them for cheap even though they’ll quote you the retail price. Also, paying interest at 3.2% isn’t too bad and my goal with the new car would be to a) keep it as long as possible and b) pay it off as soon as possible. In the long run my guess is the savings on buying a car thats 1-2 years old instead of brand new would be lower than the interest at 3.2% assuming you pay it off soon. Whatever you do – good luck and keep us posted

    1. I’m leaning on that Dan. 1-2 years old. We plan on starting a car fund sometime this year, socking away a bit of money where we can, and hopefully in 1-2 years, we can make a sizeable downpayment on a nearly new car. I really don’t want to finance my next car if I can help it. If I do, maybe the financing term can be <5 years with $5k – $10k down.

  2. we purchased a 2011 toyota sienna with 32k on it last june for cash. we just love it and we paid half the price of the new model. take the amount you would probably pay monthly for a new car and put it in a car replacement fund mark. you’ll be driving a nice new/newer vehicle in no time. ps: 0% financing is a gimmick — no such thing!!!!

  3. Ryan, you seem to know cars as much as me and you sure get more features on your Forester (AWD etc) than on the Matrix. We both WANTED a Forester to upgrade our econobox (mine was a 2002 Civic) and its definetly more convenient for a lot of uses.

    My Forester is not a lemon, I even bougth it “rebuilt” with 45,000km and never have any issue of any kind over 5 years and 50,000km of ownership. I just meant that all things being equals, a FWD x M.T. is more reliable and cost less to maintain than a AWD x A.T.

    The “marginal” diference is still 20k$ over 10 years (0.15$/km x 10,000km/years x 5 years) + 1,000$ compounded at 4%

    So, people like you and me may enjoy to drive the Forester and dont feel a big difference in our wallet

  4. As many have said, buy a used car in the 3-5 year old range and pay cash. Imagine buying a stock that was guaranteed to lose 50% of it’s value over the next 5 years… would you buy in?

    1. Good point Ryan but then again, you want to buy stocks low right? I only want stocks to rise when I get old 🙂 Kidding aside, I need to write a follow-up post about my decision. Most savvy folks are saying similar things: save some money, buy used, pay cash for the nearly used car if you can. Good advice.

      1. Yes you sure do, so you buy it when it’s down 50-60 or even 70% ;). I just bought a 2008 Subaru Forester for $7K with 160K on it after selling my 2008 Matrix that I bought new for $15K and sold for $6K. So for the extra $1000 I got a car that was worth double in the same year, loaded, leather, heated seats, awd.I will never buy a new car again. All my friends are buying these $35000+ cars but when I talk to them nobody is really investing, how can they when they have a $500 car payment at 2.8% interest. No thanks! My car does the same thing theirs does.

        1. Ryan, we have always owned Subaru’s, our Outback had over 300,000 km when we sold it, and have had 4 others over the years. (Only sold one of them because we moved overseas).

          A neighbourhood boy down our street bought his first car, a Subaru, a few months back, sounds similar to your purchase, apparently they are the “in thing” with the youngsters. His Mom told me he spent $7000 but that was including the tax and maybe the insurance, which in BC is not prohibitive for young drivers. But last week it developed a problem and the mechanic told him it had to be scrapped. So 8 year old cars are not always a bargain.

          My son got lucky buying a used car, paid under book value and was actually a retiree who drove it to church (and maybe shopping) once a week. They just wanted to be rid of it and came to the licensing/insurance place to declare that they were actually selling it below book value. And it has had virtually no problems in 4 years, he paid $3000.

        2. Ryan, if you kept the Matrix, you would have a more reliable car that cost a lot less to drive (fuel and maintenance) and save at least 0.15$/km plus the 1000$ lost in the trade. If may summ to 20,000$ over the next decade. How I know this? I did the same move 5 years ago and ran the numbers afterward…

          Still happy with the Forester thougth!

          1. More reliable than the subaru is a matter of opinion. The forester is a proven reliable vehicle. I had many reasons for the trade up and the cost difference is marginal. I wanted an auto and awd which i got for next to nothing. There are always lemons out there and I personally have never had one, i would like to think because i am thorough and know a bit about cars. The matrix was not the best car in the world.

  5. Mark, I would look for a reliable model about 5 years old in the 60-80,000km range. You would be able to get this kind of car on Craiglist for 8k$ and even if you have to finance @ 3.2% its less than 200$ interest paid if you repay over 18-24 months.

    note: paint and body repairs are a terrible idea with a 16 years old Mazda over 200,000 km!!!

    1. Good point Le Barbu about the 3.2% over the few years vs. many years. That’s just over $600 in interest on a $10k loan over 2 years. I think I’m going to start a car fund 🙂

  6. Have you considered investing some of the money that you would spend on a new car in refinishing the existing car?
    Have a body shop fix dents and repaint the bodywork, get a thorough detailing job on the inside, even get a mechanic to do some serious preventative maintenance on the whirry, clicky bits. It would definitely cost more than the car is worth, but could give the car a new life.

    I traded a much loved seven year old Impreza and bought a new one but I have always wondered if it would have been better to just give the dealer $5,000 or so to replace parts that might break.

    On the other side, there are a lot of features on newer cars that should make them much safer and more economical..

    1. Not really, but thanks for the idea. The cost to update the car might as well go to a newer car with newer parts. I think for my lil’ Mazda (going on 17 years old) putting thousands of dollars into it would be a waste of money. I think I need a car fund 🙂

  7. I would replace the old Mazda with a 2 to 4 year old used car. I think that’s a good compromise between buying new and sticking with the old. In the big picture, switching to a slightly used, or even a brand new car, every 10 years or so doesn’t add up to a lot of additional cost for transportation given the millions of dollars we earn and spend in a lifetime. 🙂 As Tom Haverford would say, “Treat yo self!” I used to have a 1993 Corolla, but have now upgraded to a 2007 Yaris. It’s so much better. 😀 I don’t drive much either, but when I do I like to feel comfortable doing it.

    1. Sound advice. I’m leaning on keeping the old car for another year. In the meantime, I will try and save what would be a car payment in the meantime, after savings for the 2017 TFSA are done. In 2017, thinking about getting a good used car, 2-3 years old. That seems to be the best value for money and many readers would probably agree.

      2007 Yaris is likely great on gas. Nice.

  8. I personally drive a 1990 Toyota corolla and i’my okay with it. Other then replacing the timing belt it hasn’t had any repairs recently. I only drive it once a week and it works fine for that purpose. Maybe you need a better goal as to what you will do with the money you save from buying a car. Maybe a vacation?

  9. If you do the cold hard accounting of it you’ll realize how massively expensive having a 20K depreciating asset sitting is your garage is.

    Look into car shares and consider renting for those times you need a second vehicle. It’s a bit outside the box (but getting less so) but it can be a huge boost to reaching other economic goals.

      1. I know – that’s an issue I deal with. I’d like a car – partially b/c of the convenience but mostly because ‘successful people have nice cars”. The problem is whenever I get close I do the math and it horrified me. One could easily argue that a car costs somewhere between 3 – $600 per month over the life of the car if you factor in insurance, maintenance and opportunity cost.

        That’s a lot of car rental, cab rides and car shares.

        I bought my first car when I was 36 or so (which I no longer own) but I figured that one could make a decent argument that all of my saving I had could be tracked back to not having the $5000 a year drain on my savings. Pretty crazy.
        Check it:

        1. How true….‘successful people have nice cars”.

          I guess I’m successful, I don’t know, I guess that depends on the context and definition (another post entirely) but that type of spending seems like a great deal of money when you put it that way: upwards of $600 per month for life of car. Geez.

          Starting with $1k, $600 per month invested for 20 years returning 5% is $250,000. $hit. I just ran the numbers.

          1. Welcome to my world. That’s a thing that is killing me now.

            Do I spend 25 K now on a blah blah Mazda 3 .. OR wait 20 years and buy one of these!:


            you can think about that with everything though. That’s what makes it a difficult (and potentially dangerous) mindset. The goal is to have enough to retire but not too much. Far too many people die with money in their accounts. Instead they should have spent the money when they could and enjoyed life a little more.

            Still.. I used to own an Audi in a previous life and I’m not sure I’d be happy owning a more ‘reasonable’ car so I’d rather rent I think.

            really though, once you get used to the car sharing and rentals – it’s not bad at all, you just get used to it like you would biking to work. For that kind of cash/savings it’s at a minimum worth looking into.

            1. Yes, you can, where the money could be spent otherwise, trade-offs, opportunity costs, etc. The rabbit hole goes on….

              We live our lives I think. We enjoy nice food, good wines, international travel and more. We are very fortunate and as long as we have our health, life is good. A big “as long as” long-term.

              It’s all about balance and I’m still trying to find mine to be honest. What I can live with when it comes to decisions. I don’t want to be a rich guy in a grave. What fun is that?

              I like the idea of a used car or a newer car vs. a brand new car more and more.

  10. Hi Mark, with a 16 yr old Mazda, have the rear suspension and area checked for rust/rot, and have a reputable technician go over it and let you know whether they would keep it if it was theirs, and what they would do with it. You say you don’t use it much and that the cost pr month is low so as long as it is less than what a monthly car payment is, then I would keep it and save the money in a TFSA or high savings account, until the cost pr month to keep it is as much as a payment. Also would not buy new for obvious reasons, 2yrs or so. i just bought a 6 yr Honda CRV. Last car was a 1999 bought in 2000 demo just got rid of it 2 yrs ago.
    Some thing…s to think about from all the comments.
    Good luck.

    1. Thanks Tim. I have, re: rust checks. I should show you the pictures! I have a good mechanic I know. The rust is there on the body but the underside isn’t too bad, yet. I keep the car in the garage to prevent additional exposure, sun is bad as well.

      The consensus so far is to keep the car, save, wait and definitely buy used. Nobody to date has screamed “go ahead and buy new” or “you only live once!” – I’m waiting for a car dealer to do that I guess 🙂

  11. You rarely use it, but you want a new car.
    Here’s what you do, put $1000 and reserve a Model 3. (So did buy a new car, just waiting for it to be released.)
    Keep the Mazda, while saving for the Model 3. (Motivation to save more!)

    Then when the Model 3 is actually in production, decide you would rather have the amount you saved than a Model 3, get a refund on the reservation.

  12. Hold off for one more year then go and satisfy your need for the shiny new car. I love buying new cars and fully understand the depreciating asset issue – but as I said “I love” buying a new car/truck. There must be lots of us with the same affliction because vehicle manufacturers keep pumping them out. In one year your primary car will be paid and you will get one more year to save up some additional cash. Here’s a few tips when you are ready to buy that beautiful shiny new automobile. Use Car Cost Canada to determine the dealer invoice price; that is not the real invoice price but a good indicator. Do not tell the dealer you are using CCC! Next focus in on several beautiful new cars that strike your fancy and steel yourself for some bargaining – this is the part I enjoy the most but it takes time and effort. Make an offer for the vehicle of choice that is 5% less than the invoice price on CCC. When the dealer says no way – walk out, get indignant, play the game. They will chase you with phone calls but let them know you are looking at competing brands and other dealers of the same brand. Don’t hesitate to go outside of Ottawa; Cassleman, Embrun, Hawkesbury, Arnprior, are good places to get prices and you can do much of it by phone and email. Be patient and disciplined – end of the month is often a good time to strike the bargain if the dealer is motivated to meet sales targets. It is possible to get a low price AND the 0% if you work at it diligently. However, always understand that the dealer must make some profit – just less on your transaction.

    1. Well Brian, the new car is definitely a want vs. need. I feel like treating myself for some good work over the recent years but that doesn’t mean I should do it 🙂

      Yes, in 9 months the primary car is paid for. That will become car #2 (secondary) and likely car #1 (the newer car) can be financed at a low rate, and term, say over 3-5 years.

      Thanks for the link, good reminder. I will check that out.

      We have looked at Honda HRV, Mazda CX3 and CX5s of late. The Mazda’s look great. Nice features.

      Interesting…I never thought of doing that much work! re: Casselman, Embrun, Hawkesbury, Arnprior, etc. Stuff to consider, so thanks.

  13. I’d say keep it as long as you can, unless you are pouring a lot of your cash to keep it running. As someone who just went through an exercise of buying a car, we were happy before the car payments. My wife’s 15 year old car finally bit the dust and we tried living on one car for a few months and finally gave-in after we couldnt manage our day-to-day operations with one single vehicle.

    Even in this low interest environment, the interest rates are ridiculous…car dealers are still charging an arm & a leg for financing. The 0% financing is not quite 0%, so you might want to watch that closely. There is a usually a “Financing charge” or something similar associated, which when you factor-in translates to something like 6-7% of the cost. So, your 0% financing can actually be 6-7%. You are better off borrowing from your financial institution instead. Thats what we did – we got a 2% rate on borrowing some cash that we need to pay back in 18 months.


    1. I keep coming back to this. It’s not costing me very much money R2R, less than $600 per year in insurance and less than $500 per year in maintenance. Not that bad…

      My wife wants us to go down to one car but I don’t know if we could. I like going to the golf course at least twice per week in the summer…

      Yes, I will be careful with the 0% financing scheme. Nothing comes free. Thanks for the comment and insight.

  14. I think you should do some shopping for your insurance. My 9-years old Civic costs me 30$ / month in insurance (500$ deductible, 2M$ civil responsibility). My car is still worth 4000-5000$ if I total it. Your’s? Probably 400-500$.

  15. I love it when people take care of older cars and keep them on the road – setting aside economics, the environmental costs of making a new vehicle far out weigh the greater emissions they produce compared to cars today. The one area where newer cars really have made improvements is safety – both in terms of crash protection but also accident avoidance (vehicle stability control, lane departure warning, even backup cameras), so that might be a worthy reason for upgrading.

    However, the key comment is “I rarely use it” – that alone is reason to keep paying the couple of hundred bucks a year to keep it in shape. Yes, new cars can be had for 0-1% interest, but you still have to repay the principle for what will be essentially $20-$25k depreciating in your driveway whether you drive it or not. Although many may compare the interest rate to your dividend yield (keep in mind your interest rate is paid in post-tax dollars), think of what the opportunity cost of taking a $20-$25k chunk out of your asset pool will be. Ouch. That will take care of the “I want a new car” blues.

    If you insist on getting a newer vehicle, take a look at the depreciation curve as the vehicle ages (plot average sales price by year to see this). Usually by year 3-4 the vehicle has depreciated to about 50% of its new value, but has far more than 50% of its useful life left. Most cars today can be expected to reach 300,000kms with proper care. Assuming the average 20k per year in driving, that would be odometers of 60-80,000kms – about 25% of the lifespan. 3-4 years of age is when most cars that are leased are returned and supply is greater. It’s harder finding newer vehicles on the used market but is doable if you give yourself enough time. I generally buy used from new car dealers – they have the best supply and sell off poor condition vehicles to auctions and the independents.

    Bottom line – I’m a car guy and would love a new car as much as you, but if it were mine, I’d take it to a car detailer for a serious refreshening (fix the rust) and have a serious mid-life refit done, replacing all fluids plus shocks/struts and normal wear pieces (plugs, battery, etc.). You will see it will drive like new again – even if it lasts 3-5 more years, it is much cheaper than replacing it, and you will have the pride of knowing you’re smarter than most of the people living car payment to car payment.

    1. Thanks BartBrandy.

      I suspect this is much more of a want vs. need. I know it is…

      Good point about the crash protection.

      The thing about the new(er) car, that will become our primary car and the existing #1 will become car #2 – the secondary car. It would not make much sense buying a new car only to never drive it while it depreciates – at least this is my thinking…

      Potentially I’ve answered my question right there – avoid paying too much for any vehicle that is not being used.

      I have looked a depreciation curves. It is painful but true! I’ve got just over 200,000 km on my 16-year-old car. I figure that’s good. I might have another 3-5 years if I really want to keep it. I’ve got some thinking to do to wrestle the wants vs. needs I think…

  16. My vehicle acquisition strategy (which I learnt from a wise friend) is to save up every month until I have enough to buy the car I want outright in cash.

    So for example, if it would cost you roughly $300 per month to pay off your vehicle finance, rather save $300 per month in a short-to-medium-term investment account that is guaranteed (such as a Money Market account). Do this religiously every month (as if you were paying off your vehicle finance). Then once you have enough, go ahead and trade in your old car as a deposit and use your saved up cash to buy your new car outright. Then continue saving each month, with the idea that you repeat this vehicle-trade-in-and-buy process every 5 to 10 years (depending on how often you want a new car and what you can afford).

    I find this has two advantages. The first is that, in the event that things go horribly wrong, I’m not stuck paying off vehicle finance on a car that I might struggle to sell for a good price. The second advantage is that I end up having access to a pile of cash should things really go sour. In other words it offers me peace of mind as well as liquidity.

    The disadvantage to this approach is that in order to get into this cash-buying cycle, you have to have saved up enough to buy your first car. But once you’re in the cycle, it has the exact same impact on your cash flow that financing your vehicle does.

    This might not be such a big deal in Canada because your second hand vehicle market is probably stable (I’m guessing) and your interests rates are gloriously low; but here in South Africa, where we deal with fluctuating vehicle finance rates that are currently hovering around 10%, it makes a lot of sense to save up and buy in cash.

    I also wouldn’t underestimate the value of safety. New cars are safe cars, and you won’t care that you’ve saved a couple hundred bucks per month when you’re lying in hospital after your airbag failed to deploy on your 15 year-old jalopy. Pardon the grim scene.

    1. Thanks for the detailed comment Kosta.

      This is part of our challenge, setting aside enough money for a new car. We haven’t focused on saving up for it, like having a car payment in advance; we’ve been focused on other things such as saving for investment purposes, and killing our mortgage debt.

      With your approach in mind, it would likely take us another 3 years to save up that money for a used car purchase (give or take). I’m not sure my 16 year old car can make it to age 19? Maybe…

      I don’t want to be where you suggested: in the event that things go horribly wrong, not stuck paying off vehicle.

      Thanks for the detailed comment. We’ve got some thinking to do this summer!

  17. I read somewhere that 52% of Millionaires drive used vehicles averaging 3 years old.
    Its not the appeal of low interest rates that are the deciding factor, but that an automobile is a “depreciating asset”. It doesn’t gain in value and especially in the early years, its declining value remains much less than its purchase price.
    Your beloved Mazda fully depreciated-out long ago and your only costs are its maintenance. How much it costs you to own it is the best timing factor of when to say “good bye” – not the fancy red car you spot on the dealer’s lot as you drove by.
    BUT sometimes, we DO just want to treat ourselves to a change. Those zero % numbers help us justify our logic.
    The compromise is to find a nice pre-owned vehicle with a positive CARFAX report, an unbiased mechanical inspection and a warranty. My suggestion is to enjoy a really great “new-to-you” vehicle by “trading up” to something newer, but not factory new.
    But whatever you decide, “if you’re going to spend some money, enjoy doing it, or don’t do it at all”.
    Make finding it “an event” and not “a task”. Have fun ..!!

    1. Thanks for the detailed comment Darrell.

      A car is absolutely a “depreciating asset” which is why I find it hard to buy a new one, but sadly, I want one….and the 0% justifies things, yes.

      Your suggestion is similar to others – get a “new-to-you” vs. brand new car. I have to give that one more thought!

      1. I know exactly what you mean Mark. In spite of what the right thing to do suggests, sometimes we ..

        Us the same.

        We still have our 2004 Honda CRV – bought new. But when my wife and I retired (me: 54, she: 51) after years of frugal monetary accountability (like you are doing), we rewarded ourselves with a brand-spanking-new sporty convertible vehicle – a Mazda MX5 (Miata).

        We park it for the winter in the garage, cancel the Collision insurance (keep Comprehensive only) and put it on a Battery Trickle Charger. Very soon I’ll be bringing it out for the summer and autumn months and park it again before the first snow.

        Mark, we are in “absolute Heaven”, driving about Ontario in this car ..!!! Yes, that IS me rolling down the highway smiling.

        So at the least, when you reach your financial goals, please set some aside for the celebration of thrills bit. Because “Life” is truly all about enjoying our short time here.

        But during our working “Choices Years”, making sure we don’t have to eat cat food when we’re 85 years young, is what we should be focused on – with a balanced enjoy-life-today-too approach.

        1. The CRVs are a good vehicle from what I know. Interesting you “treated” yourself to the Miata.

          Maybe I need to consider delaying gratification. I mean, we don’t NEED a new car and we’re on a good path financially. I also don’t like borrowing from my future self. Then again, YOLO, and life is for living. Again, decisions, decisions…

  18. I was in this situation a few months ago. Options:

    1- drive until it dies, and occasionally call a cab if a dire situation

    2- consider renting a car for the day/weekend or car sharing services. If your employer has a corporate contract with enterprise/etc you may be able to get their rate

    3- cab

    It was cheaper for me to take a cab or rent a car for a weekend a few times per month than to have the burden of car ownership

    My wife didn’t like my logic so we ended up buying a used VW for 0% financing when they were hurting for sales after their dirty diesel issue.

    Good luck!

    1. Thanks Adam. Re: #1 – it’s not dead so I still drive it. We like outside the city so having 2 cars is a must for us we fell. #3, we have Uber but that would be expensive more than a few times per month.

      Used seems to be the consensus on this money blog but not surprised, you’re all money conscious (a good thing).

  19. First off, why did you need CAA? Dead battery? If that is the only reliability issue then just get a new battery. Unless there is a serious mechanical issue, I am not a proponent of getting new. I’m driving an ’03 PT Cruiser that has seen better days but with some new brakes, ball joints and a front end alignment it’s still functional and safe. I also have an ’03 Chevy Silverado for the farm that is used on the bad winter days and I kept my old ’97 Jimmy that I can quickly register if the Cruiser gives up the ghost unexpectedly. None of them are pretty but they work. Having said all that, I am the only driver in the family and I have a very capable brother right next door who can fix older stuff. Plus we get a discount at the local parts store.

    1. Well, the car didn’t start, I have my membership so I called CAA to get a jump. Having capable car-folks helps. I wish I knew more and could fix my own stuff more…I need and want to work on that as I get older. Overall, the car has been good to me. Maybe I just need new tires and drive it for another year or so as I save up for a new(er) car?

        1. Thanks Glenn. I can likely get 4 new tires, if I decide to keep the car for another 2+ years, for less than $400 installed. That’s good for safety I think. I agree no point going new on anything if the car is ditched!

  20. Maybe you could look at waiting until your other car is paid off (since that’s relatively soon) and then trade what you have in for another car. This is how we’ve decided to do things in my household so that only one car is being paid off at a time and it teaches you to buy a car that you know you HAVE to have until it’s “your turn” to get a new one. This also ensures you take care of it and other things. Hope this helps!

    1. I’m leaning towards this DR. I certainly don’t want to have two car payments. This way, as you say, get into a cycle of having only one car payment at any time. Thanks for the comment.

  21. If it is a second car in the family and you only drive it once in a while? Keep it until it falls apart or costs more than lets say 500 to fix it.

    If you can not resist to buy a new car, do not buy a new car. Buy a decent second hand. We did that as well. In our case, it is my wife’s car. She uses it each day for her commute and occasionally for a longer trip. All other driving is with our bigger primary car.
    We did not get her a new one. We bought a 5 year old, at a garage, with a year of warranty. We also have road assistance that comes “for free” if we have at least once per year maintenance (I know there is no free lunch at that the price is included in the maintenance fee). IT allowed us to pay cash for the car, rather than borrowing money. I did not do the math, but my gutt feeling tells me that it s cheaper to buy a recent second hand and rive it for 10 years than to buy a new car each 15 years. The discount on a second hand is easily 50pct…

    1. I think a decent second hand car is not out of the question. We’d have a low insurance rate, and likely be able to keep that for 10 years anyhow.

      I’d have to run the math and see if we are really saving anything going 3-year-old car, small loan vs. brand new at 0% financing. Unless you can pay cash for a car, I feel it’s a tricky decision. Thanks for the comments Amber Tree.

  22. You’ve got a case of the wants. If it runs without too much cost, and you don’t use it very often, then keep driving it. When you need a reliable ride for the day, rent one – it’ll cost you about $30.

  23. I didn’t know you drive the car so little. Will you be driving a new car only occasionally as well? If so, maybe just wait a while, or seriously consider just upgrading to something maybe 5-7years old (7-10K range?) to satisfy the shiny urge and keep that as the secondary car. I wouldn’t invest any more other than absolutely necessary repairs to keep the Mazda roadworthy if you keep it. (probably what you’re doing) Alternatively I would also keep an open mind to a 1 or 2 year old lightly used version with warranty of what you want, even with higher interest rates. Your total outlay could be considerably less, paid off sooner, and no one but you would know its used. My last 4 vehicles fit this category with an avg age of about 18 mths and avg. bought for about 60% of retail new. Some serious dollars off on these- the BMW was 21 months old w/30kms and $45K+ less than new including tax.

    I would also be thinking of the age of your cars when you want to retire, given your desire to retire/semi retire in the next decade or so, timing it in order to avoid costly debt or a big outlay exactly at that time.

    Good luck with the decision.

    1. Thanks RBull. Well, the current primary car would become the secondary car if we got a new one.

      The smart car buyer tends to do what you and Michael James probably do – buy a car that is around 2 years old, 50% of retail and pay cash for it. The problem is we don’t have that cash. We do want to semi-retire in another 10 years and every big purchase now takes away from our ability to save, travel and other things. It’s a balance, I’m struggling with what I want to do and the desire to get a new car is higher than the need. I feel in some ways I “deserve it” for working hard and staying disciplined. Odd I know but true. We’ve got some thinking to do this year…

      1. Keep the old one!
        Especially as you don’t use it much, does a couple really need two cars? For the odd time, you could always rent. But there are plenty of older folks (75+) in my area with two vehicles….
        We had 3 kids and one car for a long time, finally got the second when our oldest was learning to drive and we wanted a smaller automatic transmission vehicle. We kept that one car a long time, it was almost as old as your one is. It was a 1998 and we traded it in 3 1/2 years ago, actually sold it as we got double what the trade in offer was in the first morning it was advertised.
        So our main vehicle is now 3 1/2 years old but feels brand new to me. We have had a couple of door dings and my husband paid to get them removed. You don’t have to worry about those things with an old car!
        The new car urge will pass–just visualize the other things the money will get you.

        1. I don’t worry about door dings at all with the old car! Our “new” car is almost 5 years old. Feels like new.

          The new car urge will pass – you’re right….it’s just nice to think about!

          I think I’ll start a car fund soon and see where we get. If only $50 a week to start with.

  24. You should be saving up for a new car. If you think 0% financing exists, you haven’t thought through how car dealerships operate. You have a choice of 0% financing or cash back. This is an admission that the car’s real price is lower and you’re really paying a much higher interest rate on financing. You’d save money by paying cash instead of taking the financing. Your mortgage rate is lower than the true rate you pay on car financing.

    1. No, I do know the game Michael (as the financing is often built into the rate) but I think my biggest problem is the case of the wants vs. needs. I mean, do I need a new(er) car? No. But I want one. We’re trying to save up the money but we’re also trying to save for next year’s TFSAs as well. I have maxed out this year. We also want to make lump sum payments on our mortgage. I feel it’s a balance and admittedly not always sure where to focus. Maybe after next year’s TFSAs are saved up then we can start saving for sizeable down payment on a new(er) car.

  25. Thanks for sharing Mark. You know whats best for your family. The 0 percent financing is just the carrot dangling infront of you to get you to purchase the vehicle by the dealership. Don’t forget that 0 percent financing on a new vehicle’s true cost is really the crazy depreciation once you drive it off the lot AND the first 3 or 4 years, it’ll wipe out half the value of the vehicle.
    I’d get a used car Mark but 2 – 4 years old so that someone else takes the hit on the depreciation and plus, it’ll be new to “you.”
    Just my 2 cents but remember, I bought my F350 for 85k and now it’s only worth like 15k so you know… terrible purchase.
    Take care my friend and have a great weekend.

    1. It is a carrot right? Michael James noted the same thing. The catch with 0% financing is that the cash rebate(s) are typically burned-in for cash only purchases that do not require financing.

      You’re right – the 0% financing basically evaporates when I drive the vehicle off the lot.

      I think the more I think about this, 2-3 years used is good. I simply need to save up the cash to buy it vs. financing via my LOC. Thanks for the comment.


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