Medicated Money

Wednesday, May 03, 2006

To Sell Or Not Sell, That Is The Question

I (Mr. Medicated) bought my vehicle as a rush decision after moving to a city that encourages driving by offering poor public transportation options. Fortunately, I was smart enough to realize that even with a new job about to start in the upcoming weeks and with that, my first real paycheck, buying a new car and dealing with the high monthly payments was not an option I was willing to entertain. After much negotiating, I struck a deal for a 1-yr old SUV that was in great condition for a total price of $17,500. To the dealer's dismay, I already had financing through my bank for a loan of the total price at 4.5%. All in all, I am very happy with my decision, however, if I could do it again, I probably would have bought a older, cheaper car, and have the loan paid for after the first few paychecks. However, that is another story. Well, 3 years later and undergoing some life changing events, ie marriage, personal finance awakening, moving closer to work, I have realized that maybe we don't need the car anymore.

We currently live 1.2 miles from our workplace. Mr & Mrs. Medicated actually work at the same location, and since Mrs. Medicated car gets better mpg, drives better in the city, and easier for Mrs to drive, we drive her car 85% of the time. As for my car, it sits in the garage except for those times when we need 2 cars (rarely ever), when we need the extra space it provides, or if we are going on a trip due to its extra comforts.

So the question: Is it worthwhile to sell 1 car and live with just 1 car?

So far I see the pro's to selling as:
  1. Selling the vehicle would eliminate the $8,428.59 we currently owe on the car. The car is currently worth $13,325, a difference of $4,896. The monthly payment of $346 could be applied elsewhere to our debt repayment.
  2. We would be able to lower our current auto insurance by only having 1 vehicle on the policy.
  3. Our auto maintenance bills would be lower by eliminating 1 car from scheduled maintenance costs
  4. More space in the garage where Mr. Medicated has free range to decorate the only place in the house without asking the wife :^)

The con's of selling:

  1. We would have only 1 car and any auto emergency or accidents would put us without transportation.
  2. We live in a large city and enjoy the ability to each have a car to drive when needed.
  3. The car we would like to sell is an SUV and may be difficult to sell due to the current gas situation and mpg of the car
  4. We love the SUV for trips, and we enjoy going on day trips/weekend trips.
  5. Eventually, we will need a second car, and the plan is to have the car paid in the next 6 months. Having a solid running car available when the time comes is a strong feeling to hold on to the car.

As you can see, we are unsure if we should sell or just keep it? What do you think?

1 Comments:

  • Keep your 2nd car. My wife and I have three cars and don't regret it at all. She is a stay-at-home mom, and I'm the only driver. But, emergencies can and do arise, and extra vehicles sure come in handy. Well worth the cost of insurance and plates to have backup vehicles.

    By Anonymous Anonymous, at 2:18 PM, May 03, 2006  

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