POOR MAN’S CAR BUYING ADVICE

This is for Clammy but it should work for anyone. She goes by Stephanie Shepard these days but she’ll affectionately remain Clammy to many of us who welcomed her to TBP by beating her into submission. She had a rough start here but she is tough as nails. She’s twice as tough and more intelligent than Peter Harris, Doug Becker and Robert S. Finnegan ever will be……even in their dreams!

I believe I first came across this idea on the radio from one of those financial advice gurus. Not the flim flam artists but the ones who offer realistic advice that if followed diligently, will pay off. I believe it was Dave Ramsey but I’m too lazy to check.

Anyway, this is a method that will allow you to upgrade your car every 12-18 months or so without going into debt and also allow you to end up in a brand new car in five years or less with no debt.

The first step is to be happy with what you’ve got because you’re going to need it a bit longer. In the event you don’t have a car then you need to scrape up whatever you can to purchase the best you can afford for now whether that’s a bicycle, bus pass or $500 model POS (piece of shit) hoopty. If you can’t scrape up $500-$1500 to get started then this method would never work for you in a million years because you have no discipline.

So, starting with the best model POS you currently have or can afford, you need to head on down to your local used car dealer to do a little dreaming and number crunching. Don’t worry, you won’t be signing or buying anything on this trip.

Tell the salesman you need a basic, reliable car to get from A to B and back to A again. Creature comforts are irrelevant at this point. You just need basic, reliable transportation at this point. Once you spot a vehicle or two that meets this criterion you need to find out how much this model POS will cost you on a monthly basis. If you can’t afford that amount then keep looking until you find something you can afford.

The second step is to go back to your miserable life driving your current model POS while simultaneously paying yourself the amount of car payment you can afford. Pretend you already owe the finance company or bank that much every month and simply pay yourself. The goal is to be your own bank!

I truly have no idea how much a basic A to B & back to A again car would cost but lets just assume $300/month. At the end of the year you will have $3600 in cash saved up plus your current model POS and you will have two options. 1. Continue to drive the current POS while continuing to save $300/month.  2. Or, go buy a better POS for $3600 and continue to pay yourself $300/month. If your current car is reliable enough to drive for another year, then do so. If not, sell it for whatever you can get and add that money to the $300/month you’re already saving.

Step three is to repeat step two, four more times. At the end of each year simply evaluate whether the current model POS you’re driving will make it another year and if so, continue driving it while paying yourself that car payment you would enslaved yourself to pay by going into debt. If you choose to upgrade, the resale value of your upgrade should be higher each time and you can bank the money from each sale to afford a better upgrade next time. With each passing year you’ll have an additional $3600 plus the car you’re driving.

That’s basically it. Lather. Rinse. Repeat. I did exactly that without ever upgrading. In July of 1999 when I bought my current POS daily driver, a ’86 Toyota 4Runner. I paid $1500 cash for it and every single month since then I’ve paid myself $600. Next month will mark 17 years exactly since I bought that 4Runner and the $600/month I did not spend on car payments pencils out to $122,400.00. If you subtract the roughly $5k I may have spent on maintenance and repairs, I’m still $117,000 to the plus side, I never went into debt and I enjoyed reliable albeit ugly transportation the entire time. Along the way I found that keeping my current model POS was preferable to spending my money to upgrade.

I don’t think I actually spent 5 grand on maintenance and repairs but $5k plus the $1500 original purchase price means that 17 years of transportation only cost me about $382 per year plus gas, insurance and registration.

Even if you have to spend $600 one month on tires, brakes or some other repair, that is still far cheaper than being obligated to paying a loan every month PLUS the cost of repairs.

Along with the above advice I would strongly suggest you find a reliable mechanic if you know nothing about cars. Any car you decide to buy should be taken to this mechanic for evaluation, prior to purchase. A fair garage shouldn’t charge more than $100. Yeah, I know, you’re already broke but that $100 could save you thousands. I do most of my own maintenance on cars but I have a reliable mechanic anyway and I hook him up. For instance, when we bought my wife’s truck a few years back I didn’t have time to inspect a bunch of cars so I called my mechanic. He works for a local garage for wages and it’s the garage that gets paid for him inspecting the vehicle so I always ask to speak to the mechanic directly and quietly slip him $50 cash each time he checked a car out for me in addition to paying the garage. I slipped him $100 cash when we found a keeper and I slip him cash every time he does any other work for me. He fucking LOVES to see me or my wife come in and he treats us right. A good, reliable mechanic is worth his weight in gold. Treat him right and he’ll treat you right.

A good mechanic can also let you know which years, brands and models to avoid and chances are he can locate a reliable car for you though a private party sale which should save you a bunch of money.