Frugality Check: Are You Spending 5% Of Your Net Worth Or 10% Of Your Income On Cars?

[GoodSteward]

$11,340. But how much was spent on fuel and maintenance?

I don't really keep track since we count milage, but I'll give it a go. We do synthetic blend and get about 7k per change, so that is about 6-7 changes a year at $42 a change between both vehicles. How much of that goes to the tax write off portion of miles, I'm not sure. Fuel, well it's $22-$25 a trip at the current prices. Around 50 weeks a year, plus several longer church trips. My guess is around $1700-$2000 a year in fuel on those miles. I did a couple new tires at $160 total, and some brakes at $300 total. I think that was all. They both are Toyota, so they don't need much maintenance.

However, my day job weekend schedule is changing(I hope), so I won't be driving as many miles this year. Right now I work every third weekend, including Sunday. I drive over a second vehicle(wife and kids go for the morning without me) on those days, and I count both vehicles. I'll have to do more visiting to make up the 200/400 miles a month I'll not have for next year. The weekend shift would change to on call only for emergencies instead of being in the office, so I won't be missing Sundays and using two vehicles.

All in all, approx $3000 it seems. Both are Toyotas so maintenance is at a minimum.

[greenskeeper]

My vehicles brought me 21,000 miles in write-offs this year due to pastoring 90 miles from where I live, as well as having members live at a distance from our church. Amazing how fast this stuff adds up.

mileage reimbursement or mileage deduction? Big difference there.

[~bs]

It is a luxury in general to own and maintain a car, however my opinion is that those numbers are pretty low. I think it should scale on a curve, the bar for low net worth should be set higher. Kinda like how spending for food, housing, clothing, etc is a higher % for poor people than it is for rich people. $400k in net worth before getting a $20k car? It's almost like saying if you have low net worth, you should just be homeless because too high a % of your income is going towards your rent expense.

One factor that needs to be considered is that the car is a depreciating asset. If you buy a $20k car and it depreciates on average $2k over 10 years until it becomes worthless, then it is actually costing you $2k to own per year, which is a lot smaller, and a more relevant comparison to net worth than the $20k up front cost. (not factoring in time value of money, maintenance costs, gas, etc)

Assuming you have 100k in net worth, bought that $20k car, it is costing you 2% of your initial net worth per year on average. This point of view is a lot more reasonable than saying it takes $400k net worth to get a $20k car. YES, it is a lot of money when compared to the net worth, but if you factor in the expected life of the vehicle, it may make the purchase justifiable (depending on the individual.) And if you keep that brand new $20k car for longer than 10 years, that % goes down greatly.