Do I buy the car?

Bliip · #1 (**permalink**) 01-08-2010, 03:19 AM

I have a Buick leSabre with 88,000 mi. on it in good cond. and a 1995 Saturn SL2 with 115,000 mi. in fair cond. Each vehicle is running fine. We put about 9000 mi./year on the Buick and 6000 mi./year on the Saturn.

Recently I had an offer to buy my friends 2004 Honda Accord DX with 24,000 mi. for $9000 that is in impeccable cond. I was not in the market for a car, but the offer seemed like something I should consider. The Buick would fill the Saturns spot and I will sell the Saturn.

My idea would be to take out a HELOC for about $13,000 and buy the car and pay off my $4000 credit card debt.
Both my wife and I work with a combined salary of $140,000. We own a house-mortgage is $1700/month. We have one child 10yrs. old.
Our total retirement savings is $160,000 and non-retirement is $12,000.
We are both 41 yrs. old.
Does this purchase make sense?

littleroc02us · #2 (**permalink**) 01-12-2010, 03:59 PM

What doesn't make sense to me is that you make $140,000 and your mortgage only consumes $20,000 of that a year. Where is the other $120,000 going towards? My guess is debt? Pay off your debt, your income is what makes you wealthy when it is free to invest longterm.

TheCaptain · #3 (**permalink**) 01-18-2010, 05:43 PM

If you were not previously looking to buy a car I would say you should not buy it. I did a quick blue book on the car you described and that price is not especially low. In excellent condition they estimated the price of a private party sale to be about $9,125. There are always deals to be had on cars if you are in the market, so I recommend sticking where you are. Good luck

JuhGail · #4 (**permalink**) 01-20-2010, 03:04 PM

Dont buy the car. The above poster is right. Where is the other $120,000 going??????

Bliip · #5 (**permalink**) 01-20-2010, 10:19 PM

Quote:

Originally Posted by JuhGail

Dont buy the car. The above poster is right. Where is the other $120,000 going??????

O.K. let me clarify some things. Our salary that was stated was gross not net which is my fault. My take home pay is about 45,370/year and my wife is a little less. I contribute 13% of my salary to my deferred comp. plan and my wife contributes 8% of hers to her 401k.
I contribute $100/month to a non-retirement income fund and another $100/month to my daughters college fund. I ive on Long Island and have some of the highest living expenses in the nation. My property/school taxes are $8300.00/year and this is in addition to heating, electric, food, life insurance, long term disability plan, etc and of course all of my daughters sports and activitiy programs (private saxaphone lessons, lacrosse, gymnastics). So no the rest is not going to debt.

C9Consulting · #6 (**permalink**) 01-21-2010, 12:43 AM

I wouldn't buy anything over $500 just because you can get a "deal" on it. That's usually how people end up wondering where there money is going when it's not going into their bank accounts.

bbtl2009 · #7 (**permalink**) 01-21-2010, 01:37 PM

Drive the cars to the ground. I had a co-worker that drove his car for 12 years! However, I would buy the car if I can turn it around right away to make a profit.

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