If I bought a brand new minivan, it would cost me $33,000.00. If we assume that I would own the vehicle for ten years, that’s $3,300.00 per year, based on purchase price.
I bought a minivan for about $3,300.00. It is thirteen years old. The body was good and it had low mileage. If I own it and then dump it after one year, that’s $3,300.00 per year based on purchase price, and ignoring other costs.
I paid cash for the vehicle. The insurance is running about $65.00 per month. It used to be $85.00 per month, but bundled with tenant’s insurance, the price is twenty bucks or so lower.
(Either that or the tenant’s insurance, to the tune of one million in liability, is essentially free.)
On the crummy old vehicle, the ‘replacement cost’ in the event of an accident would be $3,300.00, however, I don’t have collision on the vehicle. I don’t have fire, theft and vandalism on the vehicle. This represents a risk—a bet. A gamble.
As long as I’m covered for liabilities, that’s what is important. A shit vehicle is a couple or three grand. Liabilities can run into the millions—
On a brand-new vehicle, one that is on some payment schedule, a bank loan or other financing, one of the terms of the purchase or lease (certainly from my perspective) would be to have ‘comprehensive’ insurance. As a driver, I have forty plus years of experience, no at-fault accidents, no DUIs, and my last speeding ticket would have been about 1998. A perfect driving record, and yet the insurance on a brand-new machine would have to be at least double—say $1,200.00 per year, maybe even more. Maybe even a lot more. The replacement value is ten times higher, we must bear that in mind.
Now, when buying a new vehicle, the interest rates seem pretty favourable—zero percent for the first few years in some cases, from some manufacturers. Then there are bank rates and ‘alternative financing’. Some of those rates seem pretty high—five to seven percent is bad enough. I mean, we are talking $33,000.00 after all. With compounding on unpaid debt. And there is the warranty. A five, six, seven year warranty. My vehicle had no warranty whatsoever. There are times I wish I hadn’t bought it, but I can keep dumping anti-freeze down the hole and try and get my ‘one fucking year’ out of it—put a litre of oil in there once in a while, and just try and ignore the clunking of the stabilizer links and the chirp and squawk of the drive belts.
Am I saving any money, bearing in mind the gallon of anti-freeze going in there each and every month? A litre of oil, every month or two? And what about that halogen bulb I put in there for twelve bucks, or the new rad cap for ten bucks? (And it really didn’t fix the problem.)
There is such a thing as peace of mind. If I was really nuts, I’d put twelve or thirteen hundred into cylinder head gaskets. I’d have them throw a good used radiator in there from the scrapyard, and hell, I might even get another year out of it, unless she throws the belts (noisy fucking things as they are) or I get pulled over in a random safety check or something. But here’s the thing. What if they pull the heads and discover hairline cracks around the combustion chambers due to overheating? (I would still be paying for the cylinder head gasket job. Now, throw in a couple of good used cylinder heads?) I mean, what are the odds.
The previous owner dumped the vehicle for a reason. And if they got caught out on the highway or something, their first clue that something was wrong would have been that temperature gauge. Either that or steam coming out from under the hood.
A big green puddle, maybe—that was my first indication.
So that, ladies and gentlemen, is why I don’t want to get into it in the first place. If I can keep it going for a year, and then maybe find something else, who knows—maybe I can still sell it to some other poor basterd, for a thousand or fifteen hundred or whatever. To the right buyer, it might make a good ‘winter-beater’ or a work truck, or just a spare or emergency ride or something. The thing only has about 150,000 km on it, and they are known to go to 300,000 or more with proper looking-after.
So, if we throw down $33,000.00 for a vehicle and another $12,000.00 over ten years for insurance, and then follow through with all scheduled maintenance, including tires, brake jobs, tune-ups, etc. on the new machine, we could easily be spending over $50,000.00 to drive what begins as a brand-new vehicle but ends up ten years old and worth about one-third (or less) of the purchase price.
Subtract $11,000.00 from over fifty thousand dollars, do something with depreciation, and this is the true cost of driving the vehicle. This is not taking into account fuel, mileage, or any special accessories or customizations.
Honestly, I wish my math was better sometimes.
You guys know I got some really great books and stories on Amazon, don't you?
(He's saving up for another shit vehicle, ladies and gentlemen. - ed.)
Thank you for reading.