Buy an Old Beater Car or a Newer Car?

[lactatinggirl]

So about a year and a half ago, I made a bad car decision. I was pregnant with our second and decided that I needed to sell my 2003 Mitsubishi Lancer and buy a minivan. I just wanted more space. So I sold the Lancer for 4K and bought a 2003 Ford Windstar for 3.9K. Sounds like a good idea, but it turned out that the Windstar was a complete piece of crap. Within a few days the check engine light turned on (500 to fix the vacuum system) and then the brake and ABS lights started going on and off (haven't fixed that). We fixed an oil leak and now there's already another one. There's a wheel baring that needs to be replaced immediately too. That's not even counting the more cosmetic things of the passenger "door open" sensor being stuck so it always thinks the door is open, the radio fading in and out as you drive, and the DVD player having a short. Including the maintenance catch-up we did in the beginning, we've spent well over $1000 on repairs to this car and there's more coming. I made a very, very bad decision in buying this. None of this is even accounting for the fact that this van has such bad gas mileage that I spend twice as much to drive it, and therefore my husband drives it his short distance to work instead (so it's not even fulfilling it's original purpose!). We need to get rid of this thing!

So I see us as having two options. Either we get an absolutely cheap car, like 1000-2000, and assume there will be some repairs. My friend who has a degree in something to do with cars said that she'll look over any car that we're buying first, so that'll help root out the ones that are about to implode and just get the ones that are old with high mileage. She said that when you have that kind of car that you should expect to spend some money on it a couple times a year to get things repaired, but it's the trade off for not having a car payment. 

The second option is to get a bit of a nicer car and have a payment. I really don't like the idea of having a car payment, but I'm tired of always having cars that break down. If I have a car payment (I wouldn't be going for anything over $200 a month for sure), at least it's consistent. Maybe I could have a car that's under 100K miles on it again. It's been a while. Our other car is in really great condition (only previous owner was my FIL and he took great care of it), but it's getting older too (also 2003). It had it's first real repair (beyond maintenance stuff like oil and clutch) just a few months ago. So it would be nice to have one car that's a bit younger (maybe like 2008 or something?) and not be constantly repairing one or the other. Someone on here mentioned owning a Mazda5 and I think that would be great. Or maybe even something with really good MPG so that we're saving money there like a Toyota Prius. Still though, having a car payment stucks. Getting more debt sucks. But does having a car that's constantly breaking down suck more?

[sarafi]

Originally Posted by lactatinggirl 

So about a year and a half ago, I made a bad car decision. I was pregnant with our second and decided that I needed to sell my 2003 Mitsubishi Lancer and buy a minivan. I just wanted more space. So I sold the Lancer for 4K and bought a 2003 Ford Windstar for 3.9K. Sounds like a good idea, but it turned out that the Windstar was a complete piece of crap. Within a few days the check engine light turned on (500 to fix the vacuum system) and then the brake and ABS lights started going on and off (haven't fixed that). We fixed an oil leak and now there's already another one. There's a wheel baring that needs to be replaced immediately too. That's not even counting the more cosmetic things of the passenger "door open" sensor being stuck so it always thinks the door is open, the radio fading in and out as you drive, and the DVD player having a short. Including the maintenance catch-up we did in the beginning, we've spent well over $1000 on repairs to this car and there's more coming. I made a very, very bad decision in buying this. None of this is even accounting for the fact that this van has such bad gas mileage that I spend twice as much to drive it, and therefore my husband drives it his short distance to work instead (so it's not even fulfilling it's original purpose!). We need to get rid of this thing!

So I see us as having two options. Either we get an absolutely cheap car, like 1000-2000, and assume there will be some repairs. My friend who has a degree in something to do with cars said that she'll look over any car that we're buying first, so that'll help root out the ones that are about to implode and just get the ones that are old with high mileage. She said that when you have that kind of car that you should expect to spend some money on it a couple times a year to get things repaired, but it's the trade off for not having a car payment. 

The second option is to get a bit of a nicer car and have a payment. I really don't like the idea of having a car payment, but I'm tired of always having cars that break down. If I have a car payment (I wouldn't be going for anything over $200 a month for sure), at least it's consistent. Maybe I could have a car that's under 100K miles on it again. It's been a while. Our other car is in really great condition (only previous owner was my FIL and he took great care of it), but it's getting older too (also 2003). It had it's first real repair (beyond maintenance stuff like oil and clutch) just a few months ago. So it would be nice to have one car that's a bit younger (maybe like 2008 or something?) and not be constantly repairing one or the other. Someone on here mentioned owning a Mazda5 and I think that would be great. Or maybe even something with really good MPG so that we're saving money there like a Toyota Prius. Still though, having a car payment stucks. Getting more debt sucks. But does having a car that's constantly breaking down suck more?

IMO, unless you buy brand new or very new and also buy a comprehensive warranty you just have to assume things will break. I would vote on a reliable used car at whatever price you can afford and pay yourself a bit per month for when things break.

We lived in Japan for years and part of insurance over there was that you had to have a complete mechanical overhaul every two or three years and fix everything. We paid around $800 each time just fixing "stuff" that was wearing out, but in almost seven years of driving an almost twenty year old minivan I only actually broke down once.

I carry that over now, and take my car in every two years or so in the states to get an idea of what we will be needing to be done, and then fix it before it's a total PIA and on a schedule that I can live with. My mechanic charges $25 to look it over and then we work on what to fix and when to do it.

So long winded answer of "new cars are nice, but old cars can be even nicer and don't actually have to break down all the time if you buy a good one and spend the money to check them out and fix things before you are desperate and have to pay for towing, etc."

[crunchy_mommy]

Originally Posted by sarafi 

IMO, unless you buy brand new or very new and also buy a comprehensive warranty you just have to assume things will break. I would vote on a reliable used car at whatever price you can afford and pay yourself a bit per month for when things break.

I agree.

Sounds like you got stuck with a little more necessary repairs than usual, but not entirely out of the realm of normal...

We bought a car that was about 5 years old (which doesn't seem old to me at all!) and within the first year we had a lot of expenses. They really weren't things that could have been foreseen, just coincidence that some things happened to break down soon after we bought the car. And there are always cosmetic things that just don't work quite right -- like I've never been able to "unlock" the cd player/radio, which is annoying (driving around in silence) but not something we can afford to have fixed.

DH had a series of old clunkers (ones that cost under $1K) and it was horrible. We spent so much money on repairs, towing, etc. and ended up constantly needing to buy another car. It also seemed really unsafe and I would not drive around in cars like that with little kids unless I had no other option. I won't buy cars that cheap anymore because it's not a good deal financially and gave us absolutely no peace of mind, it was a constant stress.

We bought a new car once, because we found one that was cheaper than the pre-owned ones we were considering (and we were able to pay cash). It's been nice not to have to deal with repairs. We're creeping up on the 5-year mark so I suspect a lot of things will start going wrong soon, like as soon as the warranty expires with our luck. I also want to point out that there are lots of things that can go wrong with new cars that aren't covered under warranty, so you still need to set aside at least a little money for maintenance.

Owning a car is expensive!

So I guess my thoughts would be... if you aren't using the second car on a daily basis, consider just having one car and renting or using public transportation or biking. I have a few friends that do this (and we don't live in an area with much public transportation, so for the most part it means they stay home a lot or have to beg rides from friends) but they seem to be really happy with this choice, it saves them a lot of money & helps them focus on their home & family more. I could never do it, I need to get out nearly every day, and my town is particularly removed from buses and not at all walking/biking friendly! But it's something to consider.

My other suggestion, if you decide you do need 2 cars and really want a new one, is to keep the van a while longer (or trade/sell it to get something equivalently cheap) and save up to buy a new car cash. Actually that would be my advice either way -- buy any car you get, don't get a car payment. Speaking as someone who has faced several financial disasters in recent years, I've really appreciated owning our cars outright... because otherwise we wouldn't have a car anymore, they both probably would have been repossessed when DH lost his job and then I lost mine etc. and even $200 a month became completely unaffordable.

[mamarhu]

I am in exactly the same position as the OP. Last year, tax refund time, I bought an old Volvo station wagon. Although it still runs, everything non-essential is broken. No air conditioner, radio, speedometer, cup holders, rear window wiper, and at least a hundred other "luxuries". I am even ignoring the same dashboard warning lights as the OP above! I have had 4 repairs I couldn't avoid, over $250 each, and I am sure more are to come. I transport clients for work, and this car is downright embarrassing - torn upholstery, leaking roof, cracked plastic interior pieces, etc.

I also am at the decision point - with this year's tax refund, I could either go on repairing this one forever, buy a hopefully better beater, or make the down payment to get into a new hybrid. I figure the gas savings would be almost $200/month (50% of current expense)  - I drive a lot for work. But I am scared of getting into car payments. So I offer no advice, but listen for suggestions and points of view. And offer my sympathy for this predicament. Thanks, all!
 

[lactatinggirl]

I wish we lived in an area where we could do public transportation only because I love it (and we used to live in a city where we could), but the nearest bus stop is over a mile a way and that's just not feasible with little ones. I think the next time we buy a house, I'm going to specify that it has to be within a couple of blocks of a bus that runs regularly. :-P As for my husband, he could go without a car. His job is only 2-3 miles away and I could drop him off or I'm sure there's someone who he could carpool with, but he's really against the idea. He just hates the inconvenience of it. 

If we get a beater car, it would be for my husband to drive. I'm in our 2003 Toyota Matrix and it's a great little car, just starting to get old. I do understand what you guys are saying though, even a newer car would probably break down. 

[Greenlea]

I am also looking into buying a new / used car. We are going on baby #3 and need something to fit 3 car seats. We have a 1998 Jeep Wrangler we are going to fix up a little and sell for the majority of the payment on a new car. I am still making payments on our PT Cruiser, but I plan on cleaning it up and using it as a trade in (as we only owe about $1500 on it). Even if we only get what we owe, it will get rid of all car payments. So we are getting rid of 2 cars in order to afford a van.  Luckily my DH drives a company vehicle so we don't have to worry about him.

But, vans are expensive. I'm hoping to get 6-7K for our Jeep. I have yet to find a van under 100,000 miles for that much! And since I will be quitting my job once the baby comes, we won't be able to afford another car payment or full insurance on a financed vehicle. I have a feeling we're going to be buying a beater. And while my DH is pretty good at fixing cars, we'd still have to pay for any parts. Not looking forward to this at all.

[Vaske]

Five repairs in the first year and a half sounds like a lot, but a $200/mo car payment would have cost you $3600 over the same length of time.  Plus higher car insurance, probably.  But you could probably do better than the Windstar for a second car, using the reliability ratings in the Consumer Reports auto buying guides.  (You can look at them for free at the library.)  Older cars tend to score as less reliable than newer ones, just because there has been more time for problems and defects to manifest themselves, but the scores are still useful, especially if you use them to compare across makes of the same vintage to find the more reliable ones, or to find out which model years to especially avoid.

I wouldn't take on a car payment, pay cash instead, even if you have to wait and save for a while.  We have sometimes had high car repair bills on our older cars, but it has always ended up much cheaper, over the lifetime of the car, than making payments on a newer car.

You also might be able to get around well with just a couple of bikes and a bike trailer, and not have a second car at all.  Your husband could bike to work or you could bike with the kids in the trailer or you could use the car to drop him off at work (possibly with the bike) or you could just stay home.

We've been a one-car family for several years now, and it is so nice to only have one car to worry about fixing.  It is a little harder when that one car breaks down, but we've managed all right.

[iowaorganic]

Is keep what you have an option here?  At least you know what you have.  Wheel bearings go out.  You fix them.  Oil leaks are a little more worrisome- but they can be fixed.  If you buy another beater you very well may be in the same situation or worse.  The rest of the stuff is just minor irritations that wouldn't bother me at all.  I would avoid a car payment at all costs!  Even that newish car will eventually breakdown.  The cheapest car you will ever have is the one you already have.  

[lmonter]

Originally Posted by sarafi 

So long winded answer of "new cars are nice, but old cars can be even nicer and don't actually have to break down all the time if you buy a good one and spend the money to check them out and fix things before you are desperate and have to pay for towing, etc."

Yes.  It doesn't matter how reliable the car is and how it rates in Consumer Reports if you never check the oil and it runs dry (then seizing and needing a new engine).

If it's something that's going to be a money pit or just leave you looking for another car in a few months, start over.  With young kids, (at least I think) car shopping is a form of torture.
You can occasionally find nice beaters (we *just* sold my 1995 Geo Prizm, no major accidents, about 180K miles, in great condition except for burning oil, for $1650), but they can be very hard to find, which is difficult if you're in a hurry.  That said, the reason we sold the Prizm is because after 17 years of minimal maintenance I had it, it started needing at least one big-ish thing done a year the last few years.  Since hubby used it for work travel, we decided better safe than sorry so we got a newer (but used!) Corolla that he has fun zipping around in.  But.  We'll have it totally paid off within the year (if we cashed a bunch of stuff out or zeroed out an account or two we could pay it off tomorrow), which is a big difference from a 7-year finance plan.  So it kinda depends on how much wiggle room you have in your budget as well.  With either a beater or newer car you'll still need to save up for maintenance or tires (the factory ones usually suck, especially in snow/ice/slush) or whatnot, or the random visit from Murphy.
 

Please just don't buy a Windstar again (or a Dodge/Chrysler minivan, unless you have a free transmission guy - our tranny guy has sent his kids to college thanks to Dodge).  :)

[chel]

Agree, keeping what you have might be best. Atleast you know what needs to be fixed
While I drive an older car,1997, I love it so, but that is due to the previous years of great service. If I were to buy it now, there probably wouldn't be much love.

[lactatinggirl]

Thanks everyone! We've decided to definitely not get a car payment. I think I was mostly just feeling exasperated, but it's true that even newer cars will have problems. I'm also liking the idea of keeping the van because it's true that at least we know what's wrong with it. Plus we spent about $200 on it when we first got it to get it caught up on all of it's fluid maintenance and I'm guessing another beater would need that too. I just wish it got better gas mileage so I could actually use it with the kids as opposed to my husband driving it to work. :-/ That would be an issue even in a brand new minivan though, just not as drastic.