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I'm not proposing leaving nothing to one's children. Instead, I'm asking readers to consider the merits of both renting and owning and choosing what fits for th

I'm not proposing leaving nothing to one's children. Instead, I'm asking readers to consider the merits of both renting and owning and choosing what fits for them. Admittedly, I have positioned my argument strongly from a renter's perspective, as I believe the "default setting" is heavily skewed toward ownership. Fact of the matter is that many of us believe we need to own everything, when many things can be rented more economically and fruitfully (e.g. car co-op versus car ownership).

potatolicious 16y ago
+1 on the car co-op vs. car ownership thing. Home ownership is less clear-cut since homes tend to preserve their value well (not as well as we've thought, though!), so it's realistic to leave something of substantial value behind. Cars though, cars are 100% consumable. There's not a lick of persistent value behind them. Personally, I'm avoiding the car ownership pitfall for as long as humanly possible, but in this country that's not indefinitely. It's a gigantic money sink - one that most people I grew up with don't even realize, since they bought their cars along with their first jobs. They've never done a budget without their car being in the mix, to them this $1K+ per month expenditure is perfectly normal and unavoidable. A necessity of life.
- ekidd 16y ago
  How do you spend $1K+/month on a car? I've known a few people who pay that much, but they were trying to insure a sports car below the age of 25. Buy a simple used car in good shape, with 30K-60K miles on it. This will cost $7-12,000, and last for at least 8 years with a bit of maintenance. Figure $60-150/month for gas, $100/month for car insurance, and you're still in the area of $350/month. Add a few hundred per year for tires and repairs. When the repair bill reaches $100/month, buy another used car. Buying a new car, a fancy car, or a car with poor gas mileage will make these numbers much worse, of course.
  - potatolicious 16y ago
    I pulled that number from my cubemate, who's picking up a used Camry (relatively recent, '07-'08)... because apparently you can't get married unless you own a car. $1K is payment + maint + insurance + gas. Hell, I've gone over my parents' finances and that's roughly in line with how much they shell out for their cars (note: Mazdas and Toyotas, nothing fancy). Around where I grew up, unless you're driving a junker, $1K a month is pretty easy to hit (last I checked, my parents with their perfect driving record are doing ~$250 on insurance alone).
  - MrFoof 16y ago
    Rather trivially, even without insurance surcharges. I had a Lancer Evolution VIII MR for a few years... * Insurance was $150/mo. This was without an age surcharge, no speeding tickets, no accidents. As low as it was getting. * Payments were ~$500/mo for 60 months at 4.9%. That was after putting about 23.5% down, and taking sales tax into account. * Gasoline? This was a car that got 4mpg when you caned it, and averaged about 14mpg. I drove 500 miles a week. When premium was $3.50-$4.00 a gallon. Gas was $500 - $700 a month, as 150HP/liter doesn't come for free. * Maintenance? I changed my own oil (synthetic) every month. Even DIY, that was $40/mo. Nevermind everything else. A set of brake pads (DIY) was still $500-600. Rotors? More like $900. I ended up doing two brake jobs in 3 years. * The summer tires, between track days and usual commuting, lasted ~12K miles a set, at $1300/set. I also had dedicated winters at $900/set, but those never needed to be replaced. But basically, a new set of summer tires once a year meant $110/mo in just tires. "Cheaper tires" weren't an option, unless I wanted to completely neuter its handling characteristics. Honestly, it was close to $1500/mo to run that thing, and that was simply a $36,000 car that could happen to hang with things 2 to 3 times its price on a road course. I was contracting for years, and never got anything close to where I was. If I was commuting to the same place, I would've absolutely moved, and saved $300-600/mo in fuel/maintenance quite easily. I have a Miata (MX-5) now which costs dirt to run, mostly because mileage is all fun, and < 4000 a year. Insurance is cheaper than an economy car. Gets 24mpg driving it like an idiot. Proper tires are only $750-800/set. Maybe costs me $150-200/mo, since it's paid for.
    - lutorm 16y ago
      Just a point: For that car and what you apparently used it for, a car co-op wouldn't work in any case. I doubt zipcar lets you take their cars to track days, even if they had a car you'd want to take. And at 26k miles/yr, I don't think a co-op would work either. Rather than "trivially" making it to $1500/month, I think you pushed most parameters to the expensive side. As a contrast, I have a 2001 Passat that I've owned for 6 years and do all the maintenance on myself. Over 6 years I'd estimate it's cost me $25k total, which ends up being $350/month. But then I've only driven 40k over those 6 years, too.
      - 16y ago

potatolicious 16y ago

+1 on the car co-op vs. car ownership thing. Home ownership is less clear-cut since homes tend to preserve their value well (not as well as we've thought, though!), so it's realistic to leave something of substantial value behind. Cars though, cars are 100% consumable. There's not a lick of persistent value behind them. Personally, I'm avoiding the car ownership pitfall for as long as humanly possible, but in this country that's not indefinitely. It's a gigantic money sink - one that most people I grew up with don't even realize, since they bought their cars along with their first jobs. They've never done a budget without their car being in the mix, to them this $1K+ per month expenditure is perfectly normal and unavoidable. A necessity of life.

ekidd 16y ago
How do you spend $1K+/month on a car? I've known a few people who pay that much, but they were trying to insure a sports car below the age of 25. Buy a simple used car in good shape, with 30K-60K miles on it. This will cost $7-12,000, and last for at least 8 years with a bit of maintenance. Figure $60-150/month for gas, $100/month for car insurance, and you're still in the area of $350/month. Add a few hundred per year for tires and repairs. When the repair bill reaches $100/month, buy another used car. Buying a new car, a fancy car, or a car with poor gas mileage will make these numbers much worse, of course.
- potatolicious 16y ago
  I pulled that number from my cubemate, who's picking up a used Camry (relatively recent, '07-'08)... because apparently you can't get married unless you own a car. $1K is payment + maint + insurance + gas. Hell, I've gone over my parents' finances and that's roughly in line with how much they shell out for their cars (note: Mazdas and Toyotas, nothing fancy). Around where I grew up, unless you're driving a junker, $1K a month is pretty easy to hit (last I checked, my parents with their perfect driving record are doing ~$250 on insurance alone).
- MrFoof 16y ago
  Rather trivially, even without insurance surcharges. I had a Lancer Evolution VIII MR for a few years... * Insurance was $150/mo. This was without an age surcharge, no speeding tickets, no accidents. As low as it was getting. * Payments were ~$500/mo for 60 months at 4.9%. That was after putting about 23.5% down, and taking sales tax into account. * Gasoline? This was a car that got 4mpg when you caned it, and averaged about 14mpg. I drove 500 miles a week. When premium was $3.50-$4.00 a gallon. Gas was $500 - $700 a month, as 150HP/liter doesn't come for free. * Maintenance? I changed my own oil (synthetic) every month. Even DIY, that was $40/mo. Nevermind everything else. A set of brake pads (DIY) was still $500-600. Rotors? More like $900. I ended up doing two brake jobs in 3 years. * The summer tires, between track days and usual commuting, lasted ~12K miles a set, at $1300/set. I also had dedicated winters at $900/set, but those never needed to be replaced. But basically, a new set of summer tires once a year meant $110/mo in just tires. "Cheaper tires" weren't an option, unless I wanted to completely neuter its handling characteristics. Honestly, it was close to $1500/mo to run that thing, and that was simply a $36,000 car that could happen to hang with things 2 to 3 times its price on a road course. I was contracting for years, and never got anything close to where I was. If I was commuting to the same place, I would've absolutely moved, and saved $300-600/mo in fuel/maintenance quite easily. I have a Miata (MX-5) now which costs dirt to run, mostly because mileage is all fun, and < 4000 a year. Insurance is cheaper than an economy car. Gets 24mpg driving it like an idiot. Proper tires are only $750-800/set. Maybe costs me $150-200/mo, since it's paid for.
  - lutorm 16y ago
    Just a point: For that car and what you apparently used it for, a car co-op wouldn't work in any case. I doubt zipcar lets you take their cars to track days, even if they had a car you'd want to take. And at 26k miles/yr, I don't think a co-op would work either. Rather than "trivially" making it to $1500/month, I think you pushed most parameters to the expensive side. As a contrast, I have a 2001 Passat that I've owned for 6 years and do all the maintenance on myself. Over 6 years I'd estimate it's cost me $25k total, which ends up being $350/month. But then I've only driven 40k over those 6 years, too.
    - 16y ago