Tag Archives: Lower Bills

Why We Sold A Paid For Car

This weekend I drove my really nice, fully loaded, fully paid for Nissan Murano to Carmax and sold it.

I didn’t trade it for another car, I just gave them the title, happily took their check, then got in the truck with Marty and went to a street festival (I really like festivals, you should probably know that about me).

Now I’m looking for something around 10-12 years old. I want something clean and reliable, and those are my two main requirements. I also don’t want something that looks like it was previously owned by either a) a 92 year old woman or b) a 17 year old boy. I do have some standards.

Now, this whole plan makes perfect sense to us, but evidently not everyone sees the benefits of it immediately. It’s been really interesting watching peoples reactions as we go. It’s almost like an accidental social experiment. If you’ve ever done anything out of the box I’m sure you can relate.

When we sold the house we got all manner of different reactions from people… some thought it was a great idea, some were jealous, some encouraging, some even seemed aggravated at us.

On the other hand, selling the car has really only elicited one response from people, one of confusion. This is how the conversation goes:

“Where’s your car?” – Them

“Oh, I sold it.” – Me, said very matter of factly, as if it’s the only logical answer to the question… Because that amuses me a bit.

“Your Murano?!” – Them, now with a slightly wrinkled brow

“Yep.” – Me

“Why?!” – Them, now noticeably perturbed

“I just didn’t need that much car, it was nice but I shouldn’t have bought it.” – Me

Long pause, presumably while they try to decide whether I’m broke or making a political statement.

To be honest I really find the whole conversation pretty humorous, especially the parts where I know they’re trying to process and decide what’s wrong with me.

Even so, I thought I would explain why we made the decision to sell it, and why I’m not crazy yet… unless you mean crazy like a fox.

Yep. I said it.

Sorry, it won’t happen again.

We bought the Murano last July, right after my birthday. It was the first car I had owned that I loved everything about… the color, the heated seats, 5 disc CD changer, everything. Well, except for the payment. I hadn’t had a car payment for a while before that, but we traded in my paid for car and a truck that did have a payment. Although we ‘simplified’ by going from 3 cars to 2 we probably could have found a better solution looking back. But we didn’t, so for 9 months I drove, and made payments on, a really cool car that I had no need for.

Cut to the mind shift change that occurred somewhere towards the end of 2012, followed by the sale of our house. We paid off the slightly over leveraged Murano with some of the house proceeds, so no more monthly payment. It wasn’t costing us any more than the gas I put in it and the tags and insurance.

Except it was, and I slowly realized that. I also have to give props to Dave Ramsey for something he always says that I never really understood until now. He says you shouldn’t have more than 50% of your income in things that go down in value, even if those things are paid off.

I never understood that, if you weren’t paying payments, it really wasn’t costing anything, right?

If you already know the answer feel free to skip ahead, or go get a cup of coffee or something.

Survey says… Wrong! Turns out, there was a little money in my car… money I could have put in the bank. And the longer I left the money in the car, the more money I lost to depreciation, nasty little bugger.

It’s a fascinating concept really, one that I always knew but never really looked at. My car was worth X dollars this weekend, and someone was willing to give me that for it. I can now go out and spend less than a third of X and use the rest of that money to put towards a goal, put in savings, buy cupcakes with, whatever.

If I had kept my car I would have continued to drive around in a fully loaded, very sharp looking car, with a wonderfully warm posterior. But I would have lost money each and every month.

I’ll take option B – drive around in a nice, clean, reliable older car, losing only a negligible amount of money every month due to nearly all of the depreciation having already occurred and paying a lower insurance premium.

If the only difference is I won’t have heated leather seats… I think I’ll survive.

Advertisements