Posted by OhioGuy on July 21, 2008, 3:14 pm
Recently, I made a post regarding whether our house payment could be
considered a form of savings. During the discussion, someone brought up
making a car payment, and asked if I would consider that savings.
A number of folks chipped in with their various views. Many of them
considered depreciation.
Well, we have a 1969 Ford Econoline van that I got for $500. We also have
a Dodge Caravan (van) that we also paid $500 for. Then we have a 1996 Buick
Century that we've had since 2002, when it was given to us as a wedding
present.
So we have a grand total of $1,000 in 3 vehicles. From my point of view,
there really isn't a whole lot of depreciation to be had. I do most of the
maintenance myself. If we had do, I think we could probably sell these 3
vehicles for $3,500 or so. The true value is that each is dependable, well
cared for, and is insurance against ever having to make a car payment, or
have to take out a car loan.
Plus, each serves a specific purpose. The older van we bought to go
camping. We don't have to set up and take down a tent, and it works out
great in colder or wet weather. The newer van is good for medium trips
where we want a bit more room. The Buick is best for city driving and long
distance driving when it is just 1 or 2 people, and the best mileage is
desired.
For some folks, automobile depreciation isn't much of a financial issue.
We only have 2.5% of our annual income invested in our 3 autos. Of course,
we will probably put in more money into fixing some things up than might be
true with newer vehicles. Plus, it will take more time for maintenance on
my part. However, that is essentially a hobby that I enjoy, and something I
can do with my son to teach him about tools & such, so I don't consider that
a negatived aspect at all.
Posted by Seerialmom on July 21, 2008, 3:32 pm
> Recently, I made a post regarding whether our house payment could be
> considered a form of savings. During the discussion, someone brought up
> making a car payment, and asked if I would consider that savings.
> A number of folks chipped in with their various views. Many of them
> considered depreciation.
> Well, we have a 1969 Ford Econoline van that I got for $500. We also have
> a Dodge Caravan (van) that we also paid $500 for. Then we have a 1996 Buick
> Century that we've had since 2002, when it was given to us as a wedding
> present.
> So we have a grand total of $1,000 in 3 vehicles. From my point of view,
> there really isn't a whole lot of depreciation to be had. I do most of the
> maintenance myself. If we had do, I think we could probably sell these 3
> vehicles for $3,500 or so. The true value is that each is dependable, well
> cared for, and is insurance against ever having to make a car payment, or
> have to take out a car loan.
> Plus, each serves a specific purpose. The older van we bought to go
> camping. We don't have to set up and take down a tent, and it works out
> great in colder or wet weather. The newer van is good for medium trips
> where we want a bit more room. The Buick is best for city driving and long
> distance driving when it is just 1 or 2 people, and the best mileage is
> desired.
> For some folks, automobile depreciation isn't much of a financial issue.
> We only have 2.5% of our annual income invested in our 3 autos. Of course,
> we will probably put in more money into fixing some things up than might be
> true with newer vehicles. Plus, it will take more time for maintenance on
> my part. However, that is essentially a hobby that I enjoy, and something I
> can do with my son to teach him about tools & such, so I don't consider that
> a negatived aspect at all.
Generally when one is considering automotive depreciation they aren't
talking about an almost free car to begin with. Instead they're
talking about the car that continues to lose value even though you
don't own it yet, like the $24K Dodge Charger that will probably be
worth about $6K by the time it's paid off. Keeping your $500 car
running can be considered an investment if it allows you to keep your
$50K a year job.
Posted by Lou on July 21, 2008, 8:14 pm
>Generally when one is considering automotive depreciation they aren't
>talking about an almost free car to begin with. Instead they're
>talking about the car that continues to lose value even though you
>don't own it yet, like the $24K Dodge Charger that will probably be
>worth about $6K by the time it's paid off. Keeping your $500 car
>running can be considered an investment if it allows you to keep your
>$50K a year job.
Where are you drawing the line? ANY car that makes it possible to keep your
job could be considered an investment.
Posted by Seerialmom on July 21, 2008, 8:19 pm
> >Generally when one is considering automotive depreciation they aren't
> >talking about an almost free car to begin with. Instead they're
> >talking about the car that continues to lose value even though you
> >don't own it yet, like the $24K Dodge Charger that will probably be
> >worth about $6K by the time it's paid off. Keeping your $500 car
> >running can be considered an investment if it allows you to keep your
> >$50K a year job.
> Where are you drawing the line? ANY car that makes it possible to keep your
> job could be considered an investment.
Is it an investment if you buy a $35K car when you have a $19K a year
job? But if you look at the traditional term "investment" the item
itself appreciates in value, a car does not. In the case mentioned
where the cost outweighs the return, it's not a good investment.
Posted by Rod Speed on July 21, 2008, 10:09 pm
>>> Generally when one is considering automotive depreciation they
>>> aren't talking about an almost free car to begin with. Instead
>>> they're talking about the car that continues to lose value even
>>> though you don't own it yet, like the $24K Dodge Charger that will
>>> probably be worth about $6K by the time it's paid off. Keeping your
>>> $500 car running can be considered an investment if it allows you
>>> to keep your $50K a year job.
>> Where are you drawing the line? ANY car that makes it
>> possible to keep your job could be considered an investment.
> Is it an investment if you buy a $35K car when you have a $19K a year job?
Yes, a bad one.
> But if you look at the traditional term "investment"
> the item itself appreciates in value, a car does not.
Its the total value thats intended to increase over time, not just the value of
the car.
> In the case mentioned where the cost outweighs the return, it's not a good
investment.
Yes, but its still an investment, albeit a bad one.
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> considered a form of savings. During the discussion, someone brought up
> making a car payment, and asked if I would consider that savings.
> A number of folks chipped in with their various views. Many of them
> considered depreciation.
> Well, we have a 1969 Ford Econoline van that I got for $500. We also have
> a Dodge Caravan (van) that we also paid $500 for. Then we have a 1996 Buick
> Century that we've had since 2002, when it was given to us as a wedding
> present.
> So we have a grand total of $1,000 in 3 vehicles. From my point of view,
> there really isn't a whole lot of depreciation to be had. I do most of the
> maintenance myself. If we had do, I think we could probably sell these 3
> vehicles for $3,500 or so. The true value is that each is dependable, well
> cared for, and is insurance against ever having to make a car payment, or
> have to take out a car loan.
> Plus, each serves a specific purpose. The older van we bought to go
> camping. We don't have to set up and take down a tent, and it works out
> great in colder or wet weather. The newer van is good for medium trips
> where we want a bit more room. The Buick is best for city driving and long
> distance driving when it is just 1 or 2 people, and the best mileage is
> desired.
> For some folks, automobile depreciation isn't much of a financial issue.
> We only have 2.5% of our annual income invested in our 3 autos. Of course,
> we will probably put in more money into fixing some things up than might be
> true with newer vehicles. Plus, it will take more time for maintenance on
> my part. However, that is essentially a hobby that I enjoy, and something I
> can do with my son to teach him about tools & such, so I don't consider that
> a negatived aspect at all.