Overspending on Cars – What do we do now?
To recap, the 2 of us own 3 vehicles that cost us about $22,000 last year:
1. 2006 Honda Ridgeline RTS – the biggest loan (about $25k left), but the most versatility and comfort of our vehicles
2. 2005 Chevrolet Malibu – should be paid off in 6 more months (see debt scale on the sidebar)
3. 1997 Pontiac Grand Am – paid off, high mileage, but it runs great
So what’s on the horizon for 2007? Will we spend less or more?
The truth is, we’re budgeting even more towards our vehicles this year than last, specifically to pay off the loans more quickly. We expect to pay about $20,000 towards our car loans. Most of that will be to pay off the Malibu ($15k), and the rest for regular Ridgeline payments. We don’t expect insurance to go down, and gasoline fluctuates.
What can we do?
Option 1: The most logical option is to sell one of our vehicles. However, it’s not such an easy decision.
- The Ridgeline costs the most, but it’s the most versatile
- The Grand Am is paid-off and wouldn’t fetch too much on the market (maybe $2000-2500)
- The Malibu has low miles, good gas mileage and if we sold it, can we count on the Pontiac lasting another 2 years? We put about 6000 miles per year on it now, but it would double or triple if my wife used it primarily. Also, we could probably only sell the Chevy for $10k-12k. If we need to buy another vehicle in a year, could we get a reliable, fuel efficient, low mileage, mid-size car for the same price we gave up? Hmm…
Option 2: Just pay off our cars and run them all into the ground. This means we’re stuck paying off about another $40,000 total between the 2 vehicles, plus interest and insurance. That will take about 2 years.
So, if I decide to pursue selling the Malibu, can you all help me convince Clever Dudette? She’s an emotional being, while I’m logical, so she gets a bit more connected to things that I seem to do. How do I convince my wife to sell her car?