I’ve decided to put this under repair and maintenance because repair and maintenance will cost money, and money is what my concern is here.
In a few months I will be moving to beautiful Los Angeles California to pursue my dream of becoming a big, famous, super rich, Hollywood star! Actually I have a job in the film industry lined up that will pay me hardly anything - but I’ll be doing what I love so I’m going for it.
Here’s my question - I’m currently driving a 2006 Chevy Cobalt SS. Its a fantastic car. Reliability has been impeccable, and its a blast behind the wheel. However it’s costing me an extra $300/month for a payment and an extra $70 for insurance (versus liability only). I’m trying to cut costs as much as possible, and I could buy a used car for about $2000 before I leave.
Do I stick with the reliable, newer car or roll the dice with a Camry (or something similar) that has 150k? Money is going to be tight, and an extra $370 a month would feel great. Having an older car nickel and dime me to death, however, would not feel so great.
I owe less than my Cobalt is worth, so I know I can get out from under it, but should I???
Buying a used car in your current state and taking it to CA could pose some problems. CA is very tight on emission controls and a lot of cars brought into CA don’t pass smog tests. Repairs to get them to pass can be very expensive. If you must go the used car route, buy one in CA after you move there.
Compared to you '06 Cobalt, any older used car with 150K+ miles is going to cost more to repair and maintain and could easily eat up the savings in monthly payment and insurance. A Camry will use significantly more gas (which is very high priced in CA) and runs on larger more expensive tires, etc.
If money is so tight you might need a 2nd job to finance your dream, at least in the beginning. I believe buying an older high mileage used car is always a gamble. Most people put a car up for sale when it needs a significant repair, so if you buy a used car you need to budget about $1,500 for repairs right away. New tires, brakes, struts, etc. will cost close to $1,000 and those are just wear and tear items. A bad transmission, head gasket, or motor with worn out rings, puts you into the $3000 repair area.
You know what you’ve got now and I’d stick with that. You need to come up with more money, not a cheaper car.
There’s nothing wrong with a 2000 dollar car IF you have the ability to check things out thoroughly and roll the dice a bit too. There’s also the issue as mentioned of whether or not any used car you buy will be acceptable to the smog authorities in CA.
My vote is keeping the Cobalt because you know what you have with it.
Good luck on LA. I lived in that area for a short time many years ago and was happy to be out of there.
I would also go for keeping the Cobalt. At least you know what you have. If you buy something different, who knows, you could go 1000 miles and it explodes. Stick with what works.
Also, wait until you’re on La-La Land. That way, you can assess you’re lifestyle. You could find that you don’t need to own a car and can rent for a drive when you need to.
“Also, wait until you’re on La-La Land. That way, you can assess you’re lifestyle. You could find that you don’t need to own a car and can rent for a drive when you need to.”
I also say keep the Cobalt for at least 6 months after you move to LA. You could get there and find your job disappears after a month or two, or something else goes wrong and you don’t end up staying, and then regret that you sold the Cobalt. Make sure your LA transplant works out. Then maybe later sell the Cobalt if you absolutely have to. But hold onto it if you can.
Where are you moving from? If you’re already living in Ca. some of the advice isn’t necessary. Because of that, I have no idea where to start. Keep your present car, you can’t owe much on an 06 Cobalt without violating two or three economic principles of personal finance.
I moved from CT to CA and shipped our jalopy with us. For one thing, when you get here you need a car immediately. Also, used car shopping around LA is very tricky. Anything you buy, you will have to pay a 9.75% sales tax-you don’t pay this when you register you own car from out of state.
“Ouch. That 10% sales tax is standard across the board with no sliding scale or anything?”
Sales tax is sales tax, at least in Washington. Whether it’s a paper clip or a washing machine or a new car, it’s merchandise and it’s subject to sales tax. 9.5% where I live.
We have roughly a 9.5% sales tax where I live but it doesn’t apply to automobiles and that’s where the excise tax comes in.
OK charges 3.25% of the sales price on a brand new car.
With used cars it’s 20 dollars on the first 1500 of the sales price and 3.25% of the remainder. The state has a value assessment so if someone buys a fixer-upper car with a blown engine for 500 dollars the buyer still pays the tax as if it were a full retail price vehicle.
It’s been a lot of years since I was last out there in CA but can honestly say that I don’t miss any of it.
Once you’re making payments on a car, the most financially sound decision is usually to keep it until it’s paid off (at least a majority of the time). You’ve taken a hit on depreciation, and whether you replace it with a new or used car, you’ll take another hit on depreciation. Besides, unless you made a large down payment, you probably owe more than the car is worth. Even if you don’t owe more than the car is worth, you don’t want to squander the part of your down payment that was lost to depreciation.
The only way selling this car makes sense is if you find yourself a home near a bus or other mass transit line, or you live so close to work that you find you’re not using the car. If, after moving to LA, you find you don’t need a car, then you might consider selling it. Otherwise, keep it and keep making payments.
The CA sales tax is county specific, 9.75% in LA county. Might be 8.5% in the boonies, but not lower. Also bear in mind, I live in the boonies and it is still LA county-so no breaks.
If I lived in a large city…I wouldn’t own a car. Most have good public transportation systems. What’s LA like?? I know in Boston and NYC it’s much easier and cheaper to get around on public transportation then it is with a car.
I think it’s backwards out west, @MikeInNH. I have an uncle who lives in Brooklyn. He has a car he uses to get to his place upstate on weekends. He has to take a bus and a train to get to where he parks his car.
Here, of the half-dozen or so friends I have who work in Seattle proper and use the bus or train, all of them still need the car to get to the public transportation. Yes, there is bus and rail service from Tacoma to Seattle, but you need to get to the train station. Even office workers who vanpool need to drive to the vanpool lot.
Time is another factor. I had a friend’s car tied up for a big timing chain job. He was using the bus to get to work in the meantime. His 6 mile, 15 minute drive was taking an hour and 10 minutes by bus.
I think SFO and Portland have the best public transportation on the west coast, but even then I only see it working if you both live and work right in the urban center of things. As for LA, when I lived there there was no “urban center.” That place is spread out everywhere. Things may have changed now, but when I lived there it wasn’t unusual for people to have a 50-60 mile one-way commute because that’s where they could afford housing.