Should I sell my car?

[steve8820]

My wife and I both currently work. The plan is she will stay home after having our second child, probably 12-18 months away. She has a car provided by her work. The work car is full of boxes and not really useful for anything other than my wife's job. I have a 06' BMW 325i and owe $12,500 @ 5.9%. We also have an 06' BMW X3 and owe $19,000 @ 0.9% that we use on the weekends or when I drop our son at daycare. Both cars are BMW certified pre-owns and have about 3 years left on warranty.

I am considering selling my car and just driving the X3 for the next 12-18 mos until my wife stays home with our second. I figure that I will save the $12,500 in payoff, insurance costs, and maintainence with my 3-series gone during this period of time. However, the plan will be for me to just pay cash for another vehicle when my wife finally stays home. Something less than $15K and will just pay cash for it.

My question is does this make sense to sell my car now when I know that I will have to buy something in 12-18 months? Or should I just pay my car off and keep it? Thanks

[Seeker]

Both your cars are relatively new, and while you haven't provided the details, you seem to have figured a savings of 12.5k which is not something easily ignored.

I'd say that it makes a lot of sense to sell the auto that is used rarely and obtain another (with cash) when the planned child arrives and your wife gives up her work van.

I'm not sure why you wouldn't want to save some money by doing this now. I'm assuming that your car would be able to handle both children as well as your wife short term if needed (I'm showing my lack of car model knowledge here ) space-wise. But I'd say if the numbers are in your favor, go for it.

[LivingAlmostLarge]

Sure sell it, save the money. You can buy something else later.

[feh]

I agree - sell it. Why does a household w/ 2 adults need 3 cars?

[lovcom]

I would sell both BMW's. I don't know your economic standing, but if you and your wife don't make a combined $300,000+ a year, I would not advise you to keep such cars. In the interest of saving money, I would never buy those because they cost a lot more to fix, maintain, and they both guzzle gas, and a two kid family does not need such room as the X3 provides.

I would suggest you replace both of those inferior cars with brand new or near new two of the following: Civic, Fit, Yaris, Corolla. The cost of ownership of any of these cars is a lot lower then your BMW's, drink a lot less gas, give nearly the same space (you'd be surprised when you ride in one), cost a lot less to insure, are more reliable, and durable, and are made with higher quality then even the $100k BMW's.

You can maybe get two of those cars I listed new for what you might get when you sell both BMW's.

If you want to save money, provide safe transportation for your family, and want the best reliable and durable car that will have the highest longevity, stay far, far away from german cars, and embrace the Japanese cars I listed above.

PS. I owned several BMW's and I have had nothing but problems with them, and the cost to fix and maintain is wildly high.

[steve8820]

Originally Posted by lovcom

I would sell both BMW's. I don't know your economic standing, but if you and your wife don't make a combined $300,000+ a year, I would not advise you to keep such cars. In the interest of saving money, I would never buy those because they cost a lot more to fix, maintain, and they both guzzle gas, and a two kid family does not need such room as the X3 provides.

I would suggest you replace both of those inferior cars with brand new or near new two of the following: Civic, Fit, Yaris, Corolla. The cost of ownership of any of these cars is a lot lower then your BMW's, drink a lot less gas, give nearly the same space (you'd be surprised when you ride in one), cost a lot less to insure, are more reliable, and durable, and are made with higher quality then even the $100k BMW's.

You can maybe get two of those cars I listed new for what you might get when you sell both BMW's.

If you want to save money, provide safe transportation for your family, and want the best reliable and durable car that will have the highest longevity, stay far, far away from german cars, and embrace the Japanese cars I listed above.

PS. I owned several BMW's and I have had nothing but problems with them, and the cost to fix and maintain is wildly high.

Thanks for the advice. I am definitely selling my 325. My plan is to actually to pick up a pre-owned Civic in 12-18 mos when she stays home. Seem like very solid cars. We purchased the X3 as a BMW CPO and it only has $28K miles. It is covered under warranty until Feb 2012 or 100K miles, so we should be ok in the near term there........

[maat55]

Originally Posted by steve8820

Thanks for the advice. I am definitely selling my 325. My plan is to actually to pick up a pre-owned Civic in 12-18 mos when she stays home. Seem like very solid cars. We purchased the X3 as a BMW CPO and it only has $28K miles. It is covered under warranty until Feb 2012 or 100K miles, so we should be ok in the near term there........

How much car can you get if you pay cash later?

[steve8820]

Originally Posted by maat55

How much car can you get if you pay cash later?

When I buy again 12-18 mos from now the car will certainly not be as nice as the one I have now. That is why the decision is tough. However, the objective is to reduce our expenses so I am 99% sure I am selling.....

[steve8820]

So now I am back to thinking it would be a better decision to just pay off, $12K, and keep my car until it dies. I am just concerned that the car I buy in 12-18 mos will be not nearly as nice as what I have now.

If I sell now, save $12K during the next 12-18 mos what will I be able to buy for $12K?? From my searches on autotrader, probably a 2-3 yr old civic with 30-40K miles. I am not so sure I would spend $12K on that........ So confused!!!!!!

[maat55]

Originally Posted by steve8820

When I buy again 12-18 mos from now the car will certainly not be as nice as the one I have now. That is why the decision is tough. However, the objective is to reduce our expenses so I am 99% sure I am selling.....

I agree with the selling part. It's the re-buying part I'm interested in. Will you pay cash or borrow again? How much car could you pay cash for?

The reason I ask is that I believe through credit most people make bad financial decisions. My personal view on car buying is that: If I'm not willing to save long enough to pay cash, I can't afford the car. Borrowing introduces risk and over buying. Not that it's the end of the world to borrow, but having some amount of resistance to risk is a good thing.

We are buying a car next march, we will be paying cash and may even borrow 6 months of payments out of our EF, then paying it back before saving for the next car.

[LivingAlmostLarge]

Could you buy another used BMW if that's what you want?

Will the civic fit your lifestyle? I can tell you from personal experience that the civic does not fit many rear facing car seats both infant and convertible.

So in cases of emergencies you will not be able to transport your kids easily.

Our neighbors tried to install their britax roundabout convertible rear facing for their soon to be here newborn (let's pray for today!) Didn't fit. We helped and were curious, so they put it in their accord and it's tight. The damn seat is huge.

So I'd weigh that into consideration.

[steve8820]

Originally Posted by LivingAlmostLarge

Could you buy another used BMW if that's what you want?

Will the civic fit your lifestyle? I can tell you from personal experience that the civic does not fit many rear facing car seats both infant and convertible.

So in cases of emergencies you will not be able to transport your kids easily.

Our neighbors tried to install their britax roundabout convertible rear facing for their soon to be here newborn (let's pray for today!) Didn't fit. We helped and were curious, so they put it in their accord and it's tight. The damn seat is huge.

So I'd weigh that into consideration.

If I sold today, I would be looking to pay cash, ~12K or so for a 2-3 yr old vehicle in about 12 mos or so. A used BMW would not fit the bill here. That would be a really USED BMW.......

I'm really leaning on keeping the 325. I bought it with 9500 miles as a CPO. The cars has been extremely solid and is covered under warranty till 07/2012 or 100K miles. I have 47K miles now and I've kept the car in basically brand new condition.

The civic will definitely not fit the need to transport children. We could not even fit a rear facing car seat in my 325i without moving my seat ALL the way forward. So, we have never transported our son in my car. We use the X3 and will continue to do so when taking him out. The 325 is the one we are considering parting with. The X3 is staying.

[project15]

If you're going to need a second car in 12-18 months anyways, I say keep it. You won't find something as nice and well taken care of as the 325 that you've owned for most of it's life. Especially for $12k. Another option would be to just let it sit in the garage and lower the insurance on it since you wouldn't be driving it. Then, in 12-18 months, you basically have the exact same car for this same price - and possibly even paid off by then.

[lovcom]

I would suggest a major paradigm/lifestyle change. And in the interest of saving money, building true wealth, and financial security for your family I gently suggest that you Forget about luxury cars. Forget about this mindset of "something nice". Your current thinking can hold you back from getting rich, and providing substantial security for your family.

Don't be typical American ;-)

I make over $175k a year and I drive a $12,800 2007 Yaris because I want to be filthy rich one day, and you should too ;-)

There was a time I had a new BMW, or Mercedes, or Lexus every two years, and the regret I feel now about that squandor is not a good thing. It's the same thing if you buy used. And why would you want to buy a German car that is (1) very expensive, and (2) inferior in durability, longevity, and (3) economy then a new Japanese model?

[steve8820]

Originally Posted by lovcom

I would suggest a major paradigm/lifestyle change. And in the interest of saving money, building true wealth, and financial security for your family I gently suggest that you Forget about luxury cars. Forget about this mindset of "something nice". Your current thinking can hold you back from getting rich, and providing substantial security for your family.

Don't be typical American ;-)

I make over $175k a year and I drive a $12,800 2007 Yaris because I want to be filthy rich one day, and you should too ;-)

There was a time I had a new BMW, or Mercedes, or Lexus every two years, and the regret I feel now about that squandor is not a good thing. It's the same thing if you buy used. And why would you want to buy a German car that is (1) very expensive, and (2) inferior in durability, longevity, and (3) economy then a new Japanese model?

Very true on the feeling of regret. When our son was born the luxury cars certainly lost their luster. Unfortunately, we already had 2 in the garage.

[LivingAlmostLarge]

I don't know if it's wrong to want nice luxury cars. I haven't had the privilege of driving something nicer and honestly I'm sort of tired of it. I think it depends where you are financially.

I still can't afford it so I guess it's a moot point! :P

[lovcom]

Originally Posted by LivingAlmostLarge

I don't know if it's wrong to want nice luxury cars. I haven't had the privilege of driving something nicer and honestly I'm sort of tired of it. I think it depends where you are financially.

I still can't afford it so I guess it's a moot point! :P

Nothing wrong with wanting a nice expensive luxury car.

However actually buying one is profoundly bad for one's financial future in regard to building wealth, and security....

...unless of course, one is already there financially.

The single biggest reason the middle class buy luxury cars is to make this statement to their friends, family, and neighbors: I am better then you!

This is mostly an American phenomena, and it is indicative of our materialism, status-by-car, and other shallow thinking.

Oh, and don't feel bad if you can't afford a Lexus, Mercedes, or BMW, because more then 75% of those that bought these cars can't afford them either.

[steve8820]

Originally Posted by lovcom

Nothing wrong with wanting a nice expensive luxury car.

However actually buying one is profoundly bad for one's financial future in regard to building wealth, and security....

...unless of course, one is already there financially.

The single biggest reason the middle class buy luxury cars is to make this statement to their friends, family, and neighbors: I am better then you!

This is mostly an American phenomena, and it is indicative of our materialism, status-by-car, and other shallow thinking.

Oh, and don't feel bad if you can't afford a Lexus, Mercedes, or BMW, because more then 75% of those that bought these cars can't afford them either.

I am sorry, but my car purchases have been for my enjoyment and not for me to say "I am better than anyone". They were purchased because they drove extremely well, felt very solid, etc...

Granted, these cars were purchased before our son was born 6 mos ago. My thoughts and feelings on a LOT of things changed with that life event. One being not really needing to drive a car that handles well. However, the past purchases, agreed poor decisions, are "sunk costs" and what we do moving forward is most important.

[AtlantaLife&Health]

If i were you, I'd sell the 3 series. Save on insurance and car notes.

[paymydebt]

I'd say sell the car now as it's all about saving today. You don't know about tomorrow till it arrives and maybe your plans will change by then.