Keep it or sell it?
Help me out, YNAB fam...
I'm a bit of a car person, so I own several. Most of them I buy very cheap, and fix them up. My last daily driver, I owned for 15 years and it had 310k on it when I sold it 3 years ago. At that time, I decided to buy a new car, a 2017 Ford Fiesta ST. Which is an insanely fun car to drive, but I am making payments on it. The loan is $268/mo, and 3.5%.
I keep teetering on the fence of if I should sell it or not. It is the most fuel efficient vehicle I own. I average 35mpg in it with normal driving, and can get that a fair amount lower when playing, but usually keep it over 30.
Perspective: I own an 88 Chevy G20 van ($400), what I'm working on turning into a camper to sell. Van market is hot right now. I own an 02 Ford E350($1000) to turn into a camper for myself. I recently picked up an 02 Ford Ranger 4x4 for cheap ($2300, not running, now it runs great).
So I clearly don't NEED the Fiesta. Part of me wants to keep it because it's fun, and also fuel efficient. But I could probably save a fair amount of money selling it (KBB value has it around $15,500, bought it for ~$19k). Do I keep the car because it is fuel efficient, or get rid of it because it has payments?
No repair costs for awhile
Not bad on insurance
Higher insurance than other vehicles
Colorado registration is higher on new cars (started at $350, goes down every year until 10 years old)
How much driving are you doing? If you're doing enough that the fuel efficiency is useful, then it's worth keeping because it's costing you a lot compared to the others (and what it would cost to drive them longer distances frequently), but if you're not doing a lot of driving, then it's probably costing you a fair amount because the fuel efficiency isn't paying for itself. I would guess the Ford Ranger probably gets decent mileage, compared to the others anyway, so $268 a month is a LOT to pay to save a few dollars on gas, especially if you're only filling up once or twice a month due to not driving.
Appreciate all the replies. Been thinking more about this, and decided to figure out the actual cost of keeping the Fiesta a little better.
The Ranger is here to stay. I wanted a truck, and now I have one. The difference is driving the Fiesta on the regular, or selling it. If I sell the Fiesta, I daily the Ranger. So that said, here is math:
If I start commuting again down to the Springs, that's 75 miles each way, 4 days a week. That comes out to 2400mi/month. At today's Costco price, that's $1.87/gal, and at worst 17mpg highway, that comes to $264/mo in fuel for the Ranger.
The alternative to driving the Ranger that much, is driving the Fiesta those 2400 miles. At 35mpg, and with a premium fuel price (which is what I always run) of $2.23 Costco, that's $153/mo in fuel. Savings of $111 in fuel cost/mo.
But, since the alternative is to sell the Fiesta, I have to factor in registration, insurance, and payments. $268+$515/6(6mo premium)+$300/12(yearly registration)+$153 fuel gives me $532/mo for the Fiesta. I would appreciate if someone would check that my logic and math is correct here.
That means, there is no way the Fiesta is saving me money by keeping it. The question is then, is it worth the $532/mo to keep it. Even if I don't drive the Ranger hardly at all, that's at best $421/mo to keep the Fiesta.
I've decided keeping the car is not worth the debt. I'd rather get debt free, then consider buying a newer car again.
That said, the market for selling a used car seems to be good right now. I've gotten pretty good cash offers from Carvana and Vroom currently, which takes the hassle out of selling private party. And their offer isn't that far behind private party value.
I'll ditch the $268/mo payment, drop $515/6mo of insurance, won't have to pay another $300 in March on registration, and currently get about $3500-4000 cash after paying off the loan. That should go a long way to digging myself out of the hole I dug over the last several years, pre-YNAB.