Car costs: Acquisition & Repairs

[iono1]

I recently bought a new car and closed the books on my previous car. I paid cash this time. The last time I did that was 1971, when my new car cost only $1,800. I did an analysis of all acquisition and maintenance costs and came in at $393/month or about $4,700/year. I included the original cost, interest on the loan and all repairs.
This car I kept a little over 10 years. In 1986 I bought a car that I hated and kept it less than 2 years. Even though it was 25 years ago, that car came in at $367/month which translated into about $4,400/year.
Now there are many different philosophies on car buying. Some won't buy new, some will only pay cash, some will only buy beaters and drive & repair them for a two or three years. Some will only lease for 2-3 years at a time. The bottom line is, what do you feel is an acceptable annual acquisition & repair cost for a car. For a car that I've disposed of, I calculate it as follows: Payment at time of acquisition + total of car payments (which includes interest) + all repairs -sale of car. You can do the same things with a lease if you prefer leasing.
As far as my philosophy: I only buy new and as I've gotten older, I have expensive tastes in cars, but I keep them a long time, with the exception of the 1 car I bought in 1986 and hated. I feel since I keep my cars a decade or more, I can spend more & get a nicer car than someone who likes to turn over cars every few years.
So how much is your annual cost, because no matter what car you drive or what your philosophy is, it all comes down to how much per year your car cost you. Obviously, those who drive a lot will have higher car repair costs & their cars won't last as long. I average about 11,000 miles a year. 25 years ago I averaged closer to 20,000 miles a year which is one reason the 1986 car came in so high.

[whoisjohngalt]

Well, for my old car, that I bought brand new, my avg cost (using the same calculations as you) is $137/mo. I include everything except gas. We just bought a new car in august, so, we'll see how much that one will be.

Lena

[bean29]

Well, if I used your calculations I can justify buying a new car. I just had $2,000 worth of work done on my car about 1 month ago and it is broken again. DD is celebrating b/c in her teenage world if the car is not working/reliable I should just buy a new one.

I am a responsible parent though and my line of thinking is if I can just get another year or two out of this car, I can build up some college tuition $$.

Luckily I am making the final car payment on one of our cars this month. We have 3 paid for cars and 1 with a payment on it. My annual commuting miles alone are 13,000 so I am driving at least 16,000 miles a year.

I do desire a newer smaller SUV or possibly a gas sipper like a prius or a fusion or escape.

[phil5185]

Payment at time of acquisition + total of car payments (which includes interest) + all repairs -sale of car.

When you say 'repairs' - does that include normal maintenance such as oil, washes, tires, batteries, brakes - or just the things that fail (above and beyond normal ownership maintenance?

How about the 'cost of money'? With a new car, you might have $30,000 tied up that is not earning 5% elsewhere? Ie, about $1500/yr.

[Savoir Faire-Demogague in NJ]

How about the 'cost of money'? With a new car, you might have $30,000 tied up that is not earning 5% elsewhere? Ie, about $1500/yr.
Note only that, if you buy the identical model, but just two or three years old, you would likely pay 50% less and still have a well operating vehicle.

[iono1]

I included all repairs, but not car washes, since I don't have receipts for that & you can wash your car at home.
I can't get 5% on my $ because I'm too risk averse to put it somewhere where it's not 100% safe-different philosophies.
I'm already retired and my goal is to live off my pension. I am not saving toward retirement, I'm already there.
Since I have a paid off house & a new car that has a 4 year warranty, I have very few expenses. I prefer no expenses than playing with my money trying for 5%. 75% of my cash savings is in a 5 year CD, earning a puny for some 2.7%. The rest earns virtually nothing, but I have zero risk of losing any of it. It made more sense to me to lock in years of no car repairs, than to "invest" the $40,000 I spent on the car. By the time I start having car repairs, I'll be getting social security.

[phil5185]

I included all repairs, but not car washes, since I don't have receipts for that & you can wash your car at home.

OK - so you are not counting normal maintenance, such as tires, brakes, batteries?

[dancinmama]

Geez, it varies from car to car that we've had. Our first car was a Chrysler Cordoba (the one with the Corinthian leather). We bought it used with 25K miles on it for $5K (cash) in 1981. We drove that car for 13 years. We had no major repairs and sold it for a couple hundred bucks, maybe $300 when we were done with it. Best car we ever had.

The only car that we bought brand new (a Dodge Caravan) was a piece of sh.... We paid $15K for it brand new (cash) in 1987 and sold it in 2000, so we had that car for 13 years too, but it was far more costly than the Cordoba.

Obviously as time passes, each car is going to get more and more expensive to own due to inflation of price, repairs, insurance, etc.

[Savoir Faire-Demogague in NJ]

I bought a 2002 Ford Explorer in the Spring of 2005. The list price new, was in the vicinity of $28 to $30K. I bought the 2002 model year for $12,500.
The vehicle has 96,000 miles on it. For maintenance, I change the oil about three times each year, replaced the wipers once, put in a new battery, and had the accelerator linkage cleaned. I recently had the hood latch replaced.
I have been lucky with the maintenance.

[iono1]

Jan 6, 2011 12:09:28 GMT -5 phil5185 said:

I included all repairs, but not car washes, since I don't have receipts for that & you can wash your car at home.

OK - so you are not counting normal maintenance, such as tires, brakes, batteries?

Yes, I've included normal maintenance. I don't consider car washes as part of the deal, everything else counts.