The joy of (repairing) older cars
Maintenance on our two vehicles set me back nearly $3,000 on a recent visit to the mechanic, and it was money well spent.
This post comes from Len Penzo at partner blog Len Penzo dot Com.
Parents, if you want your kids to become independently wealthy, don't encourage them to go to college. Tell them to open up a car repair shop instead.
I say that because I just paid my mechanic almost 3,000 bucks for services rendered. I know.
Of course, that's what happens when you own a couple of cars that are meticulously maintained but getting a bit long in the tooth.
This week, along with the typical "full-service" oil change, our 2001 Honda Odyssey had its brakes and transmission serviced. The old girl also had her valves adjusted, and received a brand-new set of spark plugs. The makeover was made complete with a new timing belt, water pump, and a fresh set of outer drive belts.
A day later, it was my 1997 Honda Civic's turn: an oil change, transmission service, the valves adjusted, new spark plugs, and the rear brake shoes replaced.
After the Honeybee tacked on the obligatory vanilla air freshener for her Odyssey -- the automotive analog of a kid getting a lollipop after a visit to the doctor -- the entire bill came to $2,867.73. (Post continues below.)
Quite frankly, after all the money we spent, I was a bit surprised my mechanic didn't just throw the freshener in as a freebie. "They're on the house, Len -- and take one of those cucumber-melon fresheners for the Civic too! It'll make you wish your commute was 400 miles instead of 40!" Heh.
Unfortunately, no such luck.
Anyway, despite the hefty maintenance bill, I have no intention of selling either of our old cars.
Why should I? As I detailed in an article on the financial virtues of old cars last summer, the annual maintenance costs for the Civic and Odyssey averaged just $400 and $600, respectively, through 2010, although those numbers are trending upward.
Spread those costs over an entire year and it becomes obvious why so many people are willing to accept the added responsibility that comes with properly maintaining an older car in exchange for avoiding a monthly car payment.
Even so, I can hear a lot of you out there saying "Thanks, but no thanks," that the possibility of large and/or unexpected auto maintenance bills is just too much to bear.
It's really no big deal, though, for those who establish a rainy day fund, which is meant to help you weather short-term, relatively low-impact financial storms of less than $2,000.
Another alternative is to set aside a fixed amount of money each month into a separate vehicle maintenance fund.
For example, if you average $600 per year to keep your car in good running order, that's equivalent to $50 per month. You can then set up an automatic deposit into a special car maintenance savings subaccount with a bank like ING Direct.
What's particularly nice with this method is that, over time, you can gradually increase your contributions to your maintenance fund subaccount, so you'll hardly notice the difference. And if you do happen to encounter higher-than-average or unexpected maintenance expenses -- or even get hit with a double-whammy like we did this week -- you can make up the difference by tapping into your emergency or rainy day funds.
Best of all, you won't have to worry about leaving the repair shop without one of those cucumber-melon air fresheners.
More on Len Penzo dot Com and MSN Money:
- Calculator: How much vehicle can you afford?
You have to be prudent when spending significant amounts into older vehicles. I know someone that spent 7K in 1 yr. on an expensive foreign make and at least 3-4 more previously and had a collision. ACV was less than repair cost so they totaled it out. No car, no money, still a few payments left. For best results with older vehicles, Another scenario you get a bunch of work done only to have something major like the engine or transmission fail and you realized it is not worth the cost. I find it is a good idea to have a spare so if one is down you can work on it, find used parts, service etc. for less money that if you have to get it fixed right away. Also having at least one newer vehicle gives you piece of mind especially with loved ones. Night driving, long trips, commutes that go through sketchy or rural areas are not a good place to get stranded especially for those that may not be in a position to get themselves back no the road or defend themselves. Older vehicles typically don't have the latest safety equipment depending on who is driving and where/when you drive you may want to have them.
Pay your car off and continue putting that payment amount in savings. You will almost always have enough set aside for major repairs that way. Eventually, you will have enough put aside for a good used replacement vehicle.
Funny - once I started taking cash money out of savings to pay for a vehicle, I lost the appetite to spend a lot of money on new cars.
Copyright © 2014 Microsoft. All rights reserved.
Fundamental company data and historical chart data provided by Morningstar Inc. Real-time index quotes and delayed quotes supplied by Morningstar Inc. Quotes delayed by up to 15 minutes, except where indicated otherwise. Fund summary, fund performance and dividend data provided by Morningstar Inc. Analyst recommendations provided by Zacks Investment Research. StockScouter data provided by Verus Analytics. IPO data provided by Hoover's Inc. Index membership data provided by Morningstar Inc.
ABOUT SMART SPENDING
LATEST BLOG POSTS
CareerCast has released its list of jobs that really aren't as glamorous as they seem.
VIDEO ON MSN MONEY
BLOGS WE LIKE
MUST-SEE ON MSN
- Video: Easy DIY smoked meats at home
A charcuterie master shares his process for cold-smoking meat at home.
- Jetpacks about to go mainstream
- Weird things covered by home insurance
- Bing: 70 percent of adults report 'digital eye strain'