The door might be closing on the value of owning an older car outright. I know this is not groundbreaking, but the cost of ownership of even cheaper cars has gone way up, I wondered if it was even worth it to own a car at all.
I recently went looking to buy an older cheap car, something with the value $2000-$5000 dollars. What most consider a to b used car. Me personally, I don’t care what I drive. I love cars don’t get me wrong. I was out looking to pay cash for a good running car for cheap. There was a time even recently that you could find a cheap beater and slap some liability insurance, and save some real money in car payments. Actually most finally experts recommend you only buying the car you can afford to pay cash for.
I found a car I feel like that would work, I called Farmers Insurance Agent and was shocked to find rates $240 a month with a clean driving history.
This was a real shocker, I was already overpaying for my last car I had to get rid of it, I was in a weird spot with the car, the car ran fine.. but the A/C went out and I live in Las Vegas. So here I was paying $160 a mouth just about 10% of the actual value of the car with working A/C and maybe cost is upwards of 20%+ without.
And $240 a month for car insurance alone that is $2880 a year.
Have we reached a point where owning older used cars is no longer worth it? Is it better to go with services like Lyft and Uber and with fill-in of the occasional rental cars and public transportation? have we gotten to a point where it’s more cost effective to forgo car ownership altogether? I would like to look at the cost carefully and find out.
Cost annually to own a $5000 used car – Car Insurance $2880, gas 1 tank a week $540, registration & Taxes $125, Car repairs & maintenance $600 Total – $4125.00 That amounts to 340 a month. On a car you own.
Cost annually to keep a financed car – Car Payment $6000 Car Insurance $2880, gas 1 tank a week $540, registration & Taxes $600, Car repairs & maintenance $400 Total $000 That amounts to 000 a month. On a car you are making payments on.