My car just hit 200,000 miles. Crazy huh.
As a teenager, I remember hearing that once a car has 100,000 miles it is on its last legs. That definitely isn’t the standard anymore.
My car is a 2007 Nissan Murano. I bought it for $20,500 in 2008 with just over 26,000 miles. Since then I’ve driven my car all over the country. I’ve put on an average of 21,000 miles on it each year.
I love my car. I don’t have exact numbers, but excluding oil changes, brakes and tires, I doubt I’ve spent more than $3,000 in repairs over the last 8 years.
Aaron and I have three vehicles, all of which have been paid off for around six years. Two of them have over 200,000 miles and the third is just about there.
Since all of our vehicles are high mileage I’ve been putting money away for the last six years to replace whatever one dies first. I started out doing $100 a month and have gradually increased that amount as we’ve paid off debt and the vehicles have gotten older.
I’ve always known that car payments can be pricey, but since we’ve been car payment free for so long I haven’t paid attention to car prices – New Cars are expensive!
However, with this little milestone in our vehicle lives, I decided it was time to ramp up our savings since it is only a matter of time until one of them needs to be replaced.
Current reports state that the average car payment is between $400 and $500 depending on your source. That is a lot of money.
Even at a low rate of 4%, you are paying just under $3,000 in interest on a 20,000 vehicle over 5 years.
If the interest isn’t enough to make you pause, think about the freedom that comes from not having $400-500 tied up in car payments every month.
I don’t know about you, but I can definitely think of much better ways to spend my money.
Based on the current condition of our vehicles, Aaron is pretty sure we have at least another two to three years before we’ll need another vehicle.
We are the type that will run our vehicles into the ground rather than purchase something we don’t need.
The decision to run our cars into the ground has literally saved us thousands of dollars in our marriage.
Shortly after we got married, the transmission went out on Aaron’s truck. At that point, it was 8 years old. We could have easily decided that it was just too old and needed to be replaced.
Fortunately, we were already on our debt free journey and instead decided to replace the transmission, We spent $2,500 on the repair and have spent another $1,500 in miscellaneous repairs in the five years since.
****Editorial note – I’m a dork, Aaron just kindly let me know that we actually replaced the engine, not the transmission.****
If you do some basic math that means we’ve spent an average of $66 a month on the truck over a five-year time period. That is significantly cheaper than a $500 a month truck payment.
This doesn’t even take into consideration the extra costs of new vehicles like insurance and registration.
A $500 a month payment over 5 years is 30,000 and a big chunk of that is interest.
Most people would agree that spending $4,000 to repair the truck is better than spending $30,000 for the pleasure of having a new vehicle.
When you look at the true numbers, it is easy to see that purchasing a new vehicle isn’t always your best option.
Unfortunately, at some point, the cost of repairs will outweigh the economic benefits of keeping our current vehicles.
The decision will be different for each person, but for us, we decided that as long as the repairs are averaging less than $1,000-1,500 a year, per vehicle, then it is worth doing the repairs.
If the repair costs start adding up, then we’ll consider getting a new vehicle or make due with our remaining two. Talk about a first world problem – I feel like a brat for even writing that line.
Looking back I can easily see the positive financial impact our lack of car payments has had on our finances.
We had wiggle room that many people don’t have in their budgets. It allowed us to pay off our other debt quicker and made our budgeting easier. All of this, in turn, led to less stress.
I’m not saying it is easy to always drive older cars. Anytime I’m in a newer vehicle I have a moment of envy. Some of the new bells and whistles are really nice.
Our vehicles are definitely starting to show their age.
The truck was our “learner” vehicle for the girls when they started driving – let’s just say it has a few dents. I like to say it has character.
The auto lock doesn’t work on Aaron’s car and has a very nice gash in the bumper courtesy of the girls. My car is in pretty decent shape, but I can guarantee our new baby is going to mess it up pretty quickly.
Our theory has always been that vehicles are to be used, not admired for their niceness. Our vehicles prove this theory.
When you run your car into the ground, you will save money. If you save the money you would have spent on a car payment, when the time comes to purchase a new vehicle, you’ll be able to purchase a car without having to go into debt.
If you do need to purchase a new vehicle check out this post on 5 simple steps to purchasing a used car.
If you are looking for other ways to save money you may want to check out these post:
- 14 Money Saving Tips To Lower Your Grocery Bill
- How to Cheat Your Clothing Budget and Dress In Style
- 5 Ways to Avoid Banking Fees
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