When it comes to our cars, we each have our own thresholds of acceptance when it comes to the age of the vehicle. Some people really like driving a new car and feel the need to get a replacement or different one frequently. On the other end of the spectrum, some people look at car longevity in terms of piling up as many miles on their car as possible until it breaks down and needs to be replaced.
Personally, I’ve been someone who likes to drive a car until it’s racked up a ton of miles and is getting close to the end of its useful life. It comes down to the idea of maximizing the return on investment. The more miles I drive a car, the lower the lifetime cost per mile.
Example #1
Let’s say you buy a car for $20,000.
- If you drive it for 100,000 miles, you have ended up paying $0.20 per mile.
- If you drive it for 200,000 miles, you have ended up paying $0.10 per mile
Now, of course these are simplified calculations. The car with 100,000 miles can likely be resold for some reasonable figure, while a car with 200,000 miles will have a very low salvage value remaining. However, the main idea holds: the more you drive a car, the further you’re stretching your investment. Why spend part of your working capital or take out a loan on another car?
Example #2
- If you buy a new $20,000 car (today’s dollars) every 5 years, you will have spent $120,000 on cars over a 30-year period
- If you buy a new $20,000 car (again, today’s dollars) every 10 years, you will have spent $60,000 on cars over that same 30-year period.
This example of course doesn’t account for trade-in values, but the point is clear: the more miles you’re willing to drive your car – provided you keep it in good shape – the more you’ll save over the long run. In this case, it’s $60,000 over a 30-year period. Plus, with the $20,000 you save after the first 10 years, you could invest it and potentially earn a really good rate of return to grow it to much more than that.
My Last Car
I really extracted a lot of value out of the last car I had. It was a Toyota Camry, and I picked it up when it had around 95,000 miles. At the time, I had a horrendous commute which required a ton of driving. Public transportation or carpooling was not an option. Saving by sharing one car wasn’t an option either. I racked up the miles on the car, and a lesser vehicle would have broken down after a short amount of time. This car, however, worked out well.
Ultimately, I managed to drive this car to past 220,000 miles!
It’s a nice feeling for a money-saving type of person to get a great deal on a car that already has 95,000 miles, and then push it for another 125,000 miles.
At the time I sold it, I just had a sense that the car had reached a point where the good times would just have to end soon. They don’t last forever, and I didn’t want to be caught in a situation where I could be shelling out tons of money for repairs, or worse – be put in an unsafe situation due to car problems.
Selling a car before the problems start is important. There’s an optimal point, and be sure not to get too greedy. There’s saying I like, which is applicable in many situations including this: Pigs get fat, hogs get slaughtered. It’s ok to be a pig here, but don’t be a hog 
Everyone is different
While I have taken pride in squeezing as much value as I could out of my last car, there are others that just don’t like to do that. For some people, it’s a point of pride or enjoyment to have a decent ride. Additionally, some people just have their own threshold of acceptance in terms of how many miles they would be willing to drive a car.
One gal I know just bought a new car after her last car (also a Toyota Camry) reached about 150,000 miles. Now, she did get into a fender bender which added to the decision. However, I think she also really just felt better about driving a new car than a car with 150,000 miles on it. The idea of getting another 70,000 miles or so out of the car likely wouldn’t have swayed her. Rather, that would have been a time where she preferred to start anew with brand new vehicle.
Another person I know likes to lease cars. He just really enjoys cars, and wants to drive a new one every 3 years. Being a “car guy”, he wouldn’t be too thrilled with the idea of driving the same exact car for 10 years. Cars are important to him, and aren’t just a vehicle to help him get from point A to Point B.
What is your preference?
You can see my preference, in terms of car longevity, has in the past been to squeeze as much value as possible out of car and not worry about how “uncool” it might be. Others, on the other hand, really enjoy cars and want a nice ride. I have to admit, seeing a few people I know with newer cars has gotten me tempted lately to look at cars even though I don’t need one and it would be a departure from my past philosophy.
This is why I wonder what you think about car longevity, and where you fall on the spectrum:
- Do you prefer to drive a car for absolutely as many miles as it can go before it’s no longer economically or practically viable?
- Do you prefer to get new vehicles frequently, since you really enjoy cars?
- Or, are you someplace in between?
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I think I’m with you on this one. My 1/4 ton Ford just got past 150,000 with minimal maintenance. Don’t plan on selling it, either retiring it to the farm or passing it down to the kids. Mrs. 101′s Toyota is 10 years old, but with only 50,000 miles on it.
101 Centavos recently posted..Some Thoughts on Silver – Part One
101 Centavos – well done with the Ford. As for the Toyota, that’s great to just have 50,000 miles on it after so many years. Maybe you’ll get another 10 years out of it at this rate.
I am somewhere in between. I will usually buy cars brand new and then drive them as long as I feel comfortable with the mechanics. My minivan has 154,000 miles on it, and I plan to hit 200,000 which means about 2 more years. I also have a car for the teenagers to drive which has 64,000 miles on it. It is paid off and I am hoping to get about 3 to 4 more years out of it. I have a freshman and would like to see him use it through graduation.
It seems that most of the time, buying a used car with miles already on it, costs more per mile than a comparable new car. I had been using 100,000 miles as my target so that a vehicle costing $20,000 new would be less expensive per mile than one costing $12,000 with 50,000 miles. I have been able to increase my mileage with the last few cars so I may need to redo my mileage denominator.
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Optionsdude – I know people who do what you do in terms of driving a new car as long as they feel it’s in good working order and not about to face big repairs. Interesting assessment on the new vs used argument, I like the approach. 100,000 as a target is subjective (as is any other target), so maybe it would look different with 150,000 or 200,000 as the target. Might completely depend on what you drive.
I like newer cars because of all the safety features. A new car is much safer than a car with 100,000 miles on it. That’s my excuse anyway.
I usually buy a new car and drive it as far as it will go.
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Retirebyforty – this is not a bad excuse. Driving kids around in a car with tons of miles is not ideal. I don’t mind driving myself around in an older car but not others:) As far as 100,000 miles go, that seems like it might be an aggressive milestone, but of course that depends on what you’re driving. I’m not sure what the tipping point is for an “average” used car to become signficantly less safe than a new car – is it 50,000? 100,000? 150,000?
The best “deal” I ever got on a car was my first clunker -bought it for $500, drove it two years (right before it started to give out!) and sold it for $400!
I now drive a Honda Element (6 years old) and I love it. My hope is to keep it forever. Well, maybe not forever. I often joke with my husband that it will someday be a classic. However, my husband is a total car nut. He’s been talking about a new car for the past 18 months. I just keep acting dumb, trying to postpone the inevitable!
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Little House – that’s a great job on your part, effectively driving around a car for $100 after netting the purchase and sale prices together. As for keeping at bay the new car purchase, fighting the good fight of avoidance is respected around here
My cars are 16 and 14 years old. I have 160K miles and 100K respectively. As you can see, these cars average less than 10K miles per year. They would probably last another 15 years! Frankly, I am bored with them, however I hate the thought of payments even more. I also have difficulty spending cash on a depreciating asset too.
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Krantcents – I really appreciate that point of view you stated:
Great stuff!
I bought my car new (0% financing) and have driven it for 7.5 years/82,000 miles with minimal issues. I’m aiming to own it 10 years, at least. I previously bought used cars but found I had to put too much money into repairs.
Penny Frugalista – seems like a success story there. 7.5 years with that level of mileage is good mile management. Keeping it 10 years is pretty good. As for used cars, yes the wrong ones can lead to repair costs.
I just bought out the car I had since new on lease and plan on driving it for at least another 4-5 years. Why buy out? Because I only had a bit more than half the miles I could have alloted, and the car has never given me any problems at all. I know the history of this car, and for the price I paid I’m not sure I could have found a similar deal elsewhere.
I already took the worst hit of depreciation so now’s the time to try and make some of it up by holding for the long term.
Invest It Wisely recently posted..Future Imperfect- How to Prepare for an Uncertain Future
Invest it Wisely – seems like you took the car for an extended test drive in many ways!
While my car is only 8 years old and has 140,000 miles, I plan to try to squeeze out at least 200,000 miles from it. Cars aren’t a big deal to me and I’m happy with what I have.
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No Debt MBA – Getting to 200,000 would be a nice accomplishment. At 17,500 miles per year, based on your mileage to date, that would put you at over 11 years in that car. Hard to complain about that!
It’s a badge of honor for us to keep our cars for as long as possible. I’m hoping to get near 200K, even though we’ve never gotten past 112K. I think cars are better made today than in the past.
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Barb – Never gotten past 112k? Cars today can get there, at least based on my experience. Here’s hoping you get to earn that badge of honor!
I don’t get new vehicles for image or anything, but for safety. When I had 3 little kids with me everywhere, I wanted a newer car just for the reliability. Now that the kiddos are older, I don’t think I will be buying a new car for a long, long time.
Part of my problem is I still have the mental mindset that cars basically fall apart after 100,000 miles. My brain knows this isn’t true anymore, but I would be nervous driving a car a far distance with 200k miles on it.
If I could get a safety guarantee for 200k miles, I would definitely keep a car that long.
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Everyday Tips – I totally agree that safety comes first with kids. As for the 100,000 mile benchmark, I think that figure has changed. Of course, it depends on what you’re driving. As for the safety guarantee that would be nice, wouldn’t it! Perhaps it’s a matter of each of us doing all the right things regularly in terms of maintenance and taking care of the car, in order to give us more assurances.
[...] Car Longevity: How Far Will You Go to Save Money? (Squirrelers) [...]
I’ve a cheapo car I bought from my sister (Olds Alero) with mileage nearing 110k. It’s not the world’s best car by any standard, but if I can squeeze two more years out of it until I get out of school it will have done the deed.
By then, I’ll have reduced my total monthly cost of ownership close to $50 in the car (minus any possible salvage value) and I’ll be pretty happy with it. By then, I’ll probably just buy a car new, and drive it until it dies.
I’m starting to think that used cars aren’t really all that great of a deal. Due to the sheer number of people who go looking for a “used car under $10,000″ you end up saving something like $5,000 on a $15,000 new car (Ford Focus, for example) but get a car 50,000 miles used. That’s really not all that great of a deal, IMO, and it makes sense to bid slightly more than the masses to get more long-term longevity:money ratio out of it.
Cars are, to me, all about utility. Having a new car would be great, I suppose, but it really doesn’t excite me by any means. I’ll go cheap on cars and more expensive elsewhere
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We’re not that old, but our new car point seems to be when the cost of the next repair would be greater than what we could get for selling a car.
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I think I am in between. The Wife leases her car every 3 years…and I am likely to purchase one every 6 years or 7 years 100k – 120k mileage (right now I am on year 5 of my current car).
It is hard to discuss this type of topic with a “lease” person lol
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[...] presents Car Longevity: How Far Will You Go to Save Money? posted at Squirrelers. Read it to find out how many miles you can put on a [...]
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My first car I owned was a 1999 Chrysler Concorde I got it with 105k miles. I was the second owner and the previous owner had all of the service papers. Every maintenance was done properly. Nevertheless it started having blow by problems. The excessive oil burning and low compression were due to piston rings or valve seals issue either way engine rebuilt! bummer! Yeah I later know about the infamous sludge prone magnum 2.7L V6. 100k+ miles and new engine? Really Chrysler? Plus the paint started fading! So at 112k miles I traded in for a 2006 Lincoln Zephyr sport with 60k miles. The difference is HUGE in quality, speed and functionality! I trust in Lincoln’s much better dependability and quality. I hope I can get out of this car enough to reach at least 100k miles without major repairs or any breakdowns.
I personally see that till 100k miles there should not be any major mechanical issue if there is then shame on the manufacturer! I would say sell car between 100k and 125k miles to get some resale value while maintain reliability on the road too. Lexus, Cadillac, Lincoln, BMW, Mercedes, Infinity have resale value at the mileage but other “average” brands not really. But this is just my personal opinion.