What’s your odometer reading? No, this isn’t a pick up line in a biker bar. But how many of you would feel comfortable buying a used car that has a lot of miles? My car, which I call the “weekend warrior” because I really only use it two days a week, has more than 100,000 miles, it’s still ticking (knock on wood...). My good friend has a Volvo that hit 200,000 miles, which he’s very proud to tell you about. In fact, he marked the milestone with a Facebook picture of his dashboard. We’re planning to drive our 'old faithfuls' into the ground, but if you saw a used car ad for our clunkers would you shudder?
The car gurus at Edmunds.com launched something called the “Debt-Free Car Project”. The project helps you decide if you can find a reliable used car for less than $5,000. That usually means no car payments, but does that mean lots of repair bills? A year ago Edmunds bought a 1996 Lexus ES 300 for $3,800 (after tax and title) and they tracked the car's fuel, maintenance and repair costs.
Over the course of 13 months, Edmunds.com spent $3,286 – or about $253 per month – in maintenance and repairs. That’s actually the exact price of the car before tax and title. The costs did come in under Edmunds budget of $365 per month. Edmunds.com editors drove the car over 18,000 miles, including a cross-country road trip and a cruise through Death Valley, in addition to putting it through the demands of daily commutes and errands. It performed generally well, but the vehicle left Edmunds.com editors stranded on two separate occasions and generated a number of costly and unavoidable issues and repairs. But, as Montoya notes, “There's no guarantee that a newer car also won't break down.”
But the year-long project led editors there to recommend a low cost, “debt-free” car purchase only to certain buyers. “Buying in the sub-$5,000 price range, you will drive a car that will probably have repair issues, so if you have a trusted mechanic, or if you are capable of doing the repairs on your own, it could be a solid choice,” says Edmunds Consumer Advice Editor Ron Montoya. “But if you get overwhelmed dealing with mechanics and repair shops, or if you worry excessively about potential breakdowns, you may want to save enough money to prioritize reliability over cost-savings in your next car purchase.”
Interestingly when the yearlong project was over, they had no shortage of buyers for the Lexus! They sold it to a company employee for market value: $2668.
Other things to keep in mind: