Keep Suv or Get New Smaller Car Question

Easy peasy!

If you are on a mission to save money, then this is a no brainer. Sell the SUV for ca$h, then pay ca$h for another car (not new--sucker bet--even millionaires don't buy new cars they're such a bad idea financially) that gets great gas mileage. Something in the 2-3 year old range. It will most likely still have some warranty left and forget about buying any other warranty--or for that matter--anything that's offered after market.

I'd buy the new one if you don't have to get a loan! In the long run it sounds like it will save you the most money!

Paid for, insured, upgraded, new tires... don't drive a lot.

Stick with the SUV until it literally dies on you and you NEED to buy a new car. The dealer is going to tell you whatever you need to hear to sign on the dotted line.

Remember that there are lots of "fees" associated with purchasing a car which have nothing to do with the "sticker price"- taxes, tag fees, registration, etc. It's not going to be an "even swap" and you're going to have to write a check regardless and your insurance may go up b/c you will need to "review" your policy.

I would never buy a brand new car. It depreciates the second you drive it off of the lot (unless you are buying under Toyota's new 2yr 25k program, which is POSSIBLY a good reason - but I am still not convinced). Unless you plan on driving this new car till it dies and its wheels fall off, I would go with used.

Also, why would it matter if your SUV depreciates in value if you are going to continue to drive it and not sell? Value only means anything if you are wanting to trade in or sell. Vehicles always depreciate in value. Cars are a depreciating asset, which is why it makes no sense to spend a ton of money on them.

You will probably miss the room the SUV provides. We would, even if we only drive around town.

I would never trade in an already paid for car. I completely agree with TF. The dealer will tell you whatever he can to get you to buy something from him. Good luck to you!

We have a fullsize conversion van with a whopping 12 mpg. My hubby wants me to consider getting a car with a better gas mileage.
But do the math.
Consider how much your SUV costs per month, with new tires, insurance, gas the whole bit. THen do the same for a small compact car. Is there really a savings? When does it even out? How many years do you have to drive a small compact before you reap the savings?
In our case the van is paid off and the insurance is nothing. Buying a car would not be a savings until about 42 months out.

SUVs are safer. I won't drive a car anymore (I have a 2004 Honda Pilot) because I feel like I'm sitting in a go-kart. Gas prices will come down. Plus, if you don't drive it that much, the price of gas shouldn't matter so much. (Also, the dealer obviously can sell your SUV for more than the trade, so they'll make money off of you and you'll have a smaller car. Sell it outright for cash on your own. Don't trust car dealers. My sister is a car salesperson and she would tell you the same thing.)

I wouldn't trade in my vehicle to a car dealership-sell it out-right. You will get more for it. The goal of the dealership is to make money and everyone knows they make out better on the finance deal too-believe me they have a trick up their sleeve and they are snakes and will try to convince you....a paid off car is the best to have....I understand your dilemma though. If you can indeed get the other car without getting any type of car note and it gets better gas mileage then I think that is a no brainer to me but there are some other factors to consider as well such as the money you have already spent on brand-new tires as well as the insurance adjustments.....you have to play the numbers game here. Have you read Dave Ramsey's total money makeover? Don't fall into the dealers trap....make up your mind what you want and don't allow them to convince you otherwise...do your homework!!!

Are you going to miss the bells & whistles? Are there things you use the SUV for that will be more difficult with a car? How much will your insurance premium change? How much gas do you actually use driving your kids around?

I agree with Krista P. Keep in mind, even with Potential "savings" that you would need to run a ROI spreadsheet to see exactly what the ins and outs are financially. Insurance will go up as it's a "new" or "newer" car. Insurance will change if you go switch bw an import and domestic. You'll have to pay significantly higher sales, property taxes. Does it run only on premium (many cars do nowadays, esp the specialty vehicles like Mini, and I believe Prius, as well as others). Consider ALL things financially. For instance, a 0% dealer loan sounds like a no brainer, until one considers you HAVE to pay retail which also kicks up taxes, insurance, etc and your ROI delivery date gets pushed significantly so that often it pays to take a 3% note on the car with price negotiation. Additionally, tires are easily $500. Dealer tires are about $10/tire. That's an additional $500 you'd need to throw at the car immediately. And if you have blizzaks, you'd have to buy a new size of those as well. Furthermore - think of repairs. In our area, repairs for Toyotas are not only simple as the car is designed for it to be simple, but parts are plentiful as there is a plant in our town. Historically domestics are cheapest to repair but they wear and tear much more and thus NEED more repair. Is there a safety issue with either one? What does Consumer Reports, Cars.com, Edmunds, or JD Power & Asso say? **Do your homework.** Think carefully instead of just experiencing the high from the thought of saved funds.

Ultimately, to me it doesn't make sense. But we're also debt-free Dave Ramsey ppl. No way I'd give up my paid for 6 yr old Honda minivan with all the bells and whistles for a Fiesta, Versa, Sonata even tho it does only get 15 MPG bc of 30 min in the car rider lane every day!

I would keep my car that is paid for.

Trading and taking on a car note will defeat the savings.

Yes, gas rpices will go up but they are not going to stay that way. We are not selling any cars and not changing our lifestyle due to high gas prices and inflation for the time being.

I think a lot of sales reps for cars, etc are using this as a scare tactic to get more people in the door and trade or buy new cars.

We live debt free, keep food and essentials well stocked and keep savings pumped up.

Trade-you give up utility-but the savings are too good to pass on.

If you aren't getting into another car loan, I suggest going with the car. You're extending your warranty and trading your vehicle at max value, before it depreciates anymore. Added fuel economy will save you money AND aggravation. You're going to kick yourself everytime you stand there putting $60 in your tank just to have to do it again 3 days later.
I absolutely love my car. It was an adjustment because I had always felt safer sitting up high. But the truth is, I really love my car. The gas mileage is a source of pride. I love telling people i get 30 mpg in town. The ride is much smoother and more comfortable. And I checked the stats. My car is much safer than an suv. It's easier to park. And I don't get sideways glances from Hybrid people anymore!!! :)

Sell the gas-guzzler and get a gas-saver.

It may be a little extra hassle, but I'd try to sell the SUV and buy the new car with the warranty [well, actually, I'd buy a used car with lots of life in it, similar to the brand-new car that you like, but that's not one of the options ;-)] -- in a *private sale* (i.e., no dealership). Look on kbb.com (Kelly Blue Book) and see what the difference in price is for you to sell your car back to a dealer vs. straight to a new owner. Dealers have to make a profit on the used cars they buy, so almost every time, they would not be able to give you the amount that you could sell it in the newspaper or on craigslist for.

Gas probably will go higher. selling or trading the car now might be best b/c it can go down in value. SUV's went down pretty far a couple of years ago when gas sky rocketed and people had a hard time selling them. Plus, it would be easier to get rid of it and get more money while the tires are new and there is a warranty. The only thing I would ask myself is if you need the space in the SUV instead of a smaller car. I have a smaller car and am in need of more space and seating. The kids can never have friends with them and it becomes a hassle. Just think about your needs and if you don't need the SUV, I would trade it.

how far away from hauling friends and sporting equitment around. i have a van and there always seems to be an extra kid or two needing a ride. R.

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