This summer marks the 10 year anniversary of the worst purchase I have made in my life so far; a brand new SUV. Back in 2007 I had just landed a new job, which is where I am to this day, and decided the car my parents bought for me in high school, a 1996 Honda Accord LX, was ready for a trade up. I loved my Honda Accord and drove it through high school and college. I even drove it for about a year after graduation. It had nothing wrong with it, engine-wise. But the windows didn’t roll up or down very well, the power locks would jam often so the car wouldn’t lock at night and would keep attempting to. I remember countless times at the end where I would go to my car the next morning and hear my locks still trying to go down. Fantastic. Other than that I loved it and it drove great. My Accord had approximately 125,000 miles on it once I traded it in, in the summer of 2007.
Don’t Ever Buy a New Car
I traded in my 1996 Honda Accord for a brand new 2008 Nissan Pathfinder. I had been dying to have a SUV and went after one as soon as I could. I actually signed a 39-month lease at first, but then broke my lease around month 30 to purchase the car outright. I then financed my Pathfinder for 60 months. I paid it off only a couple months early, but it still took be just about 8 years to pay off a $30,000 SUV. In hindsight, this was not my proudest moment financially. I still look back to this day and wonder how long I could have kept my Accord running for. Could I have put 300,000 miles on it? Part of me really wishes I still had it. I could have just thrown $500 at the locks and been fine, right?
For 8 years I was paying $350 a month on my Pathfinder. During this same time the S&P 500 returned 7% (after the 2008 crash). If I would have invested my money into the market instead of my car, I would have close to $45,000 instead of a car I paid about $35,000 after interest. That car is only worth about $7,000 now too. Those numbers are not adding up in my favor.
Now I plan on driving my car for as long as possible. I will drive this puppy until the wheels fall. Actually, my goal is to drive it for another 10-15 years and not buy another car until my house is paid for. That is my personal finance challenge to me and my wife. This would mean I would have to drive my car until it has approximately 200,000 to 250,000 miles on it. That’s a tall order, but possible. I take good care of my car with above average maintenance and think I can pull it off. I feel like I owe it to myself after what I did in 2007 when I bought a brand new SUV. Never again will I buy I brand new car. Buy used and drive it for as long as you can.