Do I need a car?

[Anonymous]

I have an 11 year old car and took in for service today. Repair estimates are $2200 and the car is only worth around $4k. Conventional wisdom says to trade in the car. The thing is, I work from home and don't use my car much. Once a week to grab groceries, then maybe run errands on the weekend.

For my situation is it worth getting another car? I wonder if there's a once a week car rental service, or some alternate means when I need a car. Any suggestions? I'm reluctant to plunk money down on something I won't use much.

[Anonymous]

There are plenty of car share services. Car2Go, for example, or Zipcar, as well as all traditional car rentals. There are also car services like Lyft and Uber and Via.

I think it depends on where you live. I lived for 4 years in an area that had 2 Zipcar stations within a couple blocks of my house, and because we lived in a residential area where most people drove, there was almost always a car available when I needed one. If I lived in a more remote area with less access or an area where there was a lot of demand such that it was difficult to get a car when I needed it, I might reconsider.

[Anonymous]

We live in DC with kids and don't own. Between walking, biking, bus, Metro, Zipcar, Uber, and traditional car rental (Budget/Avis, etc.), we're covered. It's a pain sometimes, but it would also be a pain to own and maintain a car.

My advice: Try it without a car and see how you like it. If you decide you miss it after a few months, then get a car.

You do have to get around the psychology of spending money. It can be painful to spend $20 on an Uber when you think it would have been "free" if you owned a car, but you have to remind yourself of the thousands of dollars you're saving in fixed costs (purchase, insurance, registration, repairs).

[Anonymous]

There are sorts of alternatives to owning a car though how much you can utilize them depends on where you live. If you are close in and do short trips you can get a lot of Uber rides for $2200.

As for whether it is worth putting the money into the car that depends on the mileage on the car and the particular make and model. And some of it is just dumb luck - some cars run to 200,000 miles with relatively little maintenance while others require regular expensive work.

I have a relatively low mileage 12 year old car that I've now put $6,000 in the last 3 years - if I'd had any idea when I started that it would require this much work I never would have done the first repairs but in for a dime in for a dollar. But I had no reason to expect the parade of horrors this car has turned into but if I get another 100,000 miles out of it with relatively little additional outlay it will probably still turn out to have been the right call.

Check Consumer Reports to try to make a guess about how much more in repairs your car might require - they do a pretty comprehensive annual survey of car owners about their experiences with different models even down to the year.

[Anonymous]

$4k plus $2200? You can get a $4k car that doesn't require that much repair. Mine is 10 years old, worth $4k, doesn't require expensive service-has 95000 miles on it, the insurance is $270 every 6 months, parking is free. I drive it all the time though. I find metro expensive when I have to take it.
Why don't you calculate your monthly use vs how much you'd spend without car. Don't forget time.

[Anonymous]

Do you live near public transport or somewhere you can find a Zipcar or Car2Go? If so, then ditch the car.

[Anonymous]

OP here. Thanks for all suggestions. I'm in Centreville VA so the closest Zip Car is at George Mason in Fairfax. I think we're going to try going without the car and see how that works out.

[Anonymous]

You can probably use a cab every time you'd usually use a car and still save money.

I don't remember the exact figure but when I was a teenager my father explained to me that owning a car costs something like 7k per year. And I don't mean on car payments or the original car cost. I mean on things like insurance, gas, maintenance, parking, storage, etc.

[Anonymous]

I have friends who are car-free and do Zip car, Uber and Lyft and they definitely spend less in a month than they would on a car payment and insurance and property taxes. (don't forget those last two things.)

I'm still driving my 2004 Acura with not-quite 120k miles on it. I love that thing. I spend $1-$3k per year in repairs, which is still cheaper than the payments on any car I'd want to drive. The insurance is low and the property tax is almost nonexistent since the value is low. I need a car, though - my daughter's activities are not even remotely transit-friendly; neither is her school.

[Anonymous]

Anonymous wrote:You can probably use a cab every time you'd usually use a car and still save money.

I don't remember the exact figure but when I was a teenager my father explained to me that owning a car costs something like 7k per year. And I don't mean on car payments or the original car cost. I mean on things like insurance, gas, maintenance, parking, storage, etc.

That seems really high. I drive from DC to Baltimore 4 days a week for work, plus errands on the weekend and pay $150/month on gas (high estimate) so $1800/year; our insurance is $700/year; maintenance was $1000 (4 oil changes, new brakes and rotors, and some other maintenance). That's $3500/year and I put 25,000 miles a year on my car.

[Anonymous]

Anonymous wrote:

Anonymous wrote:You can probably use a cab every time you'd usually use a car and still save money.

I don't remember the exact figure but when I was a teenager my father explained to me that owning a car costs something like 7k per year. And I don't mean on car payments or the original car cost. I mean on things like insurance, gas, maintenance, parking, storage, etc.

That seems really high. I drive from DC to Baltimore 4 days a week for work, plus errands on the weekend and pay $150/month on gas (high estimate) so $1800/year; our insurance is $700/year; maintenance was $1000 (4 oil changes, new brakes and rotors, and some other maintenance). That's $3500/year and I put 25,000 miles a year on my car.

Ahem

http://newsroom.aaa.com/auto/your-driving-costs/

Owning and operating a new vehicle in 2017 will cost a driver an average of $8,469 annually, or $706 each month, according to a new study from AAA.

[Anonymous]

Anonymous wrote:

Anonymous wrote:You can probably use a cab every time you'd usually use a car and still save money.

I don't remember the exact figure but when I was a teenager my father explained to me that owning a car costs something like 7k per year. And I don't mean on car payments or the original car cost. I mean on things like insurance, gas, maintenance, parking, storage, etc.

That seems really high. I drive from DC to Baltimore 4 days a week for work, plus errands on the weekend and pay $150/month on gas (high estimate) so $1800/year; our insurance is $700/year; maintenance was $1000 (4 oil changes, new brakes and rotors, and some other maintenance). That's $3500/year and I put 25,000 miles a year on my car.

At 25K miles per year you are replacing your car every 6-8 eats at the most. So in addition to ththe above you also have to divide the cost of buying a new car. A $25 car would therefore cost $3k-$4k per year. And that presumes that your maintenance remains at $1K per year which is insane. I also don’t buy that you have insurance for $700 per year that has adequate collision and liability coverage. At best under your math a car costs $6k per year. And that somehow assumes that you never pay for parking, car washes and never pay the deductible after an accident (ever). It also presume no financing cost. Even 1% interest on a $25k car costs $250 the first year. On a less expensive used car the amount borrowed is smaller but interest rate is higher.

If you don’t need one for work or live in the middle of literally nowhere it is very unlikely that owning a Car makes financial sense for anyone.

[Anonymous]

Anonymous wrote:OP here. Thanks for all suggestions. I'm in Centreville VA so the closest Zip Car is at George Mason in Fairfax. I think we're going to try going without the car and see how that works out.

I would want a car if I lived there. See how it works for you. You can always buy a cheap car later.