Buying a new car?

[Reiper]

So I have a 4 year old kia coming off lease, I didn't like it that much, and I was looking at new cars.

After doing some test drives, I really liked the chevy volt, but it is $30k after rebates. This works out to $440 a month over 84 months.
Alternatively I could buy my crappy Kia for about 9k, or even look at other used cars.

For someone making $15/h, would financing the volt be a horrible financial decision? I really like the idea of getting a new car. I don't pay rent if that makes a difference

 

[JoJo]

Seven years is a long time, I suppose you would have to be fairly sure that your source of income is secure and that you won't gain any expensive responsibilities (like rent) in that time.

 

[Redlin5_v1legacy]

Will you always be without paying rent? Needing a high percentage of your income to suddenly shift to the needs of rent and utilities can be a real culture shock. Food is expensive in North America. A car can open many opportunities so you need to figure out your positive return on investment.

 

[Snails]

I would not go for the volt. Those are high payments, over a loooong period of time. I make around what you do and I have a 350$ payment for 5 years finance. I regret it. I would either go for the kia or find a cheaper new car.

 

[sneakypenguin]

Holy hell no. Your going to be in debt and underwater and 84 months good lord. If you have to buy a new car just get a civic or something I paid like 16,500 and 0.9% financing I think my monthly payment was like 270 and that felt bad to me.

New car purchases are financially bad but if you make good money sure that 30k won't hurt you but honestly 15 an hour isn't "good".

If you have a permanent and paid for residence sure you could do it but a 7!! year loan on the assumption of not paying rent is super risky.

EDIT: Volt depreciation is massive btw you'll be so far underwater unless you put like 15k down.

 

[DrownedAmmet]

Have you thought about leasing? You'll probably pay less per month. The only problem is at the end of it you won't own a car, but if you like having brand new cars every few years it might be the way to go

I'd recommend a used Prius though, they've been around for a while now so you can probably find one with a low amount of miles on it for a good price

Edit: failed at reading, didn't realise you leased before. Still should go used on your budget imo

 

[Phoenixmgs_v1legacy]

I don't think I would even buy a new car unless I had enough money to where it didn't matter. A 5-year old car is still in great condition most of the time, and the 1st few years cars lose quite a bit of value. I've twice purchased 4-year old Civics and I haven't had any issues outside of standard maintenance. You can also buy a used cheap car only a couple years old like a Versa or Accent for a really good price and they'll only have like 20,000 miles on them. I do prefer the Japanese cars, they run forever. I did have drive a Chevy Malibu rental for a month and it failed on so many little things like I just couldn't get the side mirrors set right (I couldn't move them outward enough), the passenger seatbelt beeps went off when I put a pizza on the seat (so annoying), the clock would be 10-15 minutes off when getting off work but be perfectly set in the morning somehow, etc. I really have come to love the dash of the Civic where your speedometer is just below your eyeline so you don't have to take your eyes off the road to see your speed.

I'd recommend a used Prius though, they've been around for a while now so you can probably find one with a low amount of miles on it for a good price

I just was looking at cars a couple months back (bought a 2012 Civic) and the normal Prius is quite price-y even used. However, I was very interested in the Prius C (used) and the price point was really good but I wasn't able to test drive one when I was looking (either they were too far away or it had just left the dealership).

 

[gsilver]

Man, I make 100k, and I still have a hard time justifying a used car over 15k.
My current car was 13.6k. Leather interior, sound system, cd changer, AWD. About 5 years old with 76k miles when I got it, now nearing 90k with only basic maintenance so far.

New cars are a freaking rip-off.

If I made $15/hr, I'd be looking at the cheapest bucket of bolts that wouldn't fall apart that I could find.

 

[DrownedAmmet]

I don't think I would even buy a new car unless I had enough money to where it didn't matter. A 5-year old car is still in great condition most of the time, and the 1st few years cars lose quite a bit of value. I've twice purchased 4-year old Civics and I haven't had any issues outside of standard maintenance. You can also buy a used cheap car only a couple years old like a Versa or Accent for a really good price and they'll only have like 20,000 miles on them. I do prefer the Japanese cars, they run forever. I did have drive a Chevy Malibu rental for a month and it failed on so many little things like I just couldn't get the side mirrors set right (I couldn't move them outward enough), the passenger seatbelt beeps went off when I put a pizza on the seat (so annoying), the clock would be 10-15 minutes off when getting off work but be perfectly set in the morning somehow, etc. I really have come to love the dash of the Civic where your speedometer is just below your eyeline so you don't have to take your eyes off the road to see your speed.

I'd recommend a used Prius though, they've been around for a while now so you can probably find one with a low amount of miles on it for a good price

I just was looking at cars a couple months back (bought a 2012 Civic) and the normal Prius is quite price-y even used. However, I was very interested in the Prius C (used) and the price point was really good but I wasn't able to test drive one when I was looking (either they were too far away or it had just left the dealership).

Yeah, the Prius's I checked out were a little bit more expensive than an equivalent non-hybrid car, but I thought OP might be interested in that since they were interested in a volt.
I went with a Chevy Cobalt which was about the same price as a Prius that was a couple years older and with more miles. Payed about ten grand total loan for a four year old car, which runs great and will be payed off soon. But sometimes I look back and think I should have went with the Prius

 

[Guffe]

I have loads of co-workers who change cars very often!
I've never owned a car.
But most people here seem to be searching quite long (and sometimes hard) for a good deal on a used car, in stead of a new car.

 

[Elvis Starburst]

Nah. I recommend getting a used car that you can better afford. I got a 2000 Civic that only had 115,000km on it, and the exterior was redone. Alloy rims, leather interior, heated seats, security systems, sun roof, and remote start were added by the owner. Got the thing for $8000. It's been damn good to me. If you can find a deal like that, you'd be set for quite awhile. I know I got lucky, but hey, look everywhere. There's good deals in all sorts of places

 

[Cycloptomese]

No way, dude! Go used. A little over a year ago, I bought a 2006 Cadillac CTS for around 10k USD. Came out to $250/month for five years. I always pay more than the $250 every month and throw a double payment on there during bonus month and tax time. I'll have it paid off in half that time.

Also, you'll want to check into how much it'll be to insure as well.

 

[Frezzato]

OP, how many miles did you put on your lease? Was it new when you started? And did you damage it at all?

 

[gsilver]

But most people here seem to be searching quite long (and sometimes hard) for a good deal on a used car

Nah. It's pretty easy.
Auto dealerships can be desperate to close a deal, especially near the end of the month (to meet their quotas)
You can get one dealer to give you a bid, and then you can get another to undercut that bid (to a point, anyway).

I had my previous vehicle totaled in an accident (not-at-fault, at least, though my insurance company really low-balled the settlement... all the more reason to not spend too much in the first place), and got the replacement in just two days of going to dealerships (after a week or so reading about cars online to figure out what I wanted; always do that. To a dealership, what they want you to think you want is always what they have in stock, regardless of actual needs).

 

[circularlogic88]

7 years is a huge commitment. Nuts to that, get a used car. Paying over 250 a month on car payments alone with a $15/hr job doesn't seem practical to me.

Also: Always make sure your paying money on the principle and not on the interest. You'll save yourself money in the long run.

 

[Frezzato]

Okay, OP, I'm going to recommend you buy the lease if you got the car new.[footnote]Sorry, I've only bought one car, my lease. I have no idea if all leases are new cars or not.[/footnote] My reasoning is:

Getting another car, either buying or leasing, will cost you yet another deposit. Yes, this will be incorporated into the cost overall, but not having to scrape together the cash is nice.

If you're the first owner of the car, then you know what you're getting. Granted, maybe you're not crazy about the car, but getting a smaller loan for a car now beats having to come up with another down payment plus a larger loan for a longer period of time.

I can only assume that the primary reason you leased in the first place was that your credit wasn't all that great - OR - you wanted lower payments because you couldn't afford to buy the car outright. If your financial situation hasn't changed since you first leased your car, I would stick with the Kia. Maybe you'll start earning more a few years from now. Great! Save that money for a new car after this one.

If the final cost of the loan to buy your current car was $9,500, at an interest rate of 3.11%, you would pay $171 for 60 months. If you shorten that to four years you would pay $211 a month. At three years it would be $277. That's doable at almost any rate of pay.

I think you should buy your current car, pay off the loan, and continue building good credit. Keep saving money and you can have a nice down payment for the next car.