How We’re Going To Afford Purchasing a Second Car

I have made mention that we were looking to get second vehicle. We’ve done well with one vehicle for some time but with my commute to work, Maria’s involvement in activities increasing and Mike still occasionally traveling out of town for work (taking our only vehicle with him), the time has come. We were hoping to wait until the debt was paid off but neither one of us is interested in the scramble that we have going on now any longer than we have to. We would 100% be screwed if we didn’t have our family to rely on. While I love them, and know they don’t mind helping us out, we would like the independence from them and their vehicles.

Before we could figure out a timeline about when this purchase is going to happen, we needed to figure out a target price. The car we buy will be used and likely a private sale. We also need to consider additional costs involved such as registration and paying for something like a CarProof report or mechanic exam. The last thing I want is to buy a car that I later finds out has a lien on it or something!

After doing a few days of research, we decided a target price of $5,000 would get us the kind of vehicle we’re looking for. Moderate mileage, safety inspected done, reliable and less than about 8 years old. We want a car that’s easy on gas since we have a SUV crossover now that isn’t so great with city driving (but satisfies our requirement for a larger vehicle for Mike’s work equipment). We’ll save an additional $500- $1,000 with a max savings target of $6,000 which will be able to take care of stuff mentioned above such as registration.

In order to do this, changes will have to be made. We’re not going to start saving for this until November at the earliest. We want to finish paying off the loan we’re currently working on before we look at saving for a car. As long as stuff like hot water heaters stops breaking on us we should be on target to have this loan paid off in October and start saving for the car by November. I’m not interested in buying a vehicle in the winter (in case we don’t get winter tires with the purchase it’s a cost we could save up for), so we won’t buy until probably May 2016.

This gives us seven months to save $6,000, a monthly target of about $850. Given that we put a minimum of $1,000/month towards this current loan, alone, I know the money will be in our budget, it does however mean that the next loan in line to be paid off will be delayed. It will still be getting some additional payments (anywhere from $150-$400 extra per month), it won’t get the full payment until after we buy the car. It’s too far in the future to know if we will be able to ”make up” the money we’re putting into the car, which is lost in extra debt payments, but I sure hope even with a $5000-$6,000 setback we can still meet out target of November of 2017 to be (non-mortgage) debt free, I’m just not 100% sure how I’m going to make it happen!

To find out what car we got check out this article. To get tips on how to buy your next car read the other two.

We’re Officially a Two Car Family Again
How to Get out of an Underwater Car Loan
How to Successfully Buy a Used Car

Enjoy Plunged in Debt?

Pid

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  1. Can you really get something that decent for $5,000? I’ve looked through ads quite a bit at some point when trying to decide how much we should save towards a car replacement fund in case our car dies. Prices for something decent (mileage around 100K, no frills 4-door sedan with no fancy brands) hovers around $10K. May be in your area cars are cheaper.
    Financial Underdog recently posted..Canadian Exempt Market Investments – Friend or Foe?My Profile

    • Three years ago I bought an ’03 Alero 4dr used with 114k miles for $5,000. While it’s not the most fun car, it’s been a good enough daily driver for work. Sure, I’ve had to replace a part or two, but even then.. the car has cost less than $160/mo amortized since then. Not bad a return on investment for something that will loose value.

    • Catherine says:

      Again private sales but there were quite a few options…a few that I remember were an 07 Passat for 5500, 08 corolla for around the same…those are the “types” of cars we’re looking at. Reliable sedan.

  2. I think that it is great that you have a plan and not just running out and getting the next hot car on the market. If more people approached all large purchases this way, there wouldn’t be so many people in debt.
    Petrish @ Debt Free Martini recently posted..Fab Reads of The Week of 6/7My Profile

  3. That’s so cool. Getting a second car is possible if budget permits and there’s enough savings. Being in debt free first then start saving for a car is best way to do. Good luck!
    Jayson @ Monster Piggy Bank recently posted..6 Interview Tips You Need To KnowMy Profile

  4. It sounds like you have thought this through, and you have a plan. This does not sound like an impulse purchase, so I say go for it! My car is eight years old and a standard (which I hate on Halifax hills!) and I’ve been itching to replace it, but my frugality is preventing me at the moment. When we do go for a replacement (within the next three years most likely), it’ll probably be a four year old lease return from the dealership, similar to what we got last time. I’m just not competent enough with cars to do a private sale. I’d have to make good friends with a mechanic between then and now.

    Can’t wait to see what you guys end up buying. I can already see the difference how you’re approaching this and how you would’ve approached it before paying off your debt, which is a great thing.
    Jordann recently posted..Let Me Buy You A Personal Finance Book (And You Get to Choose!)My Profile

    • Catherine says:

      I’ve never had problems with private sales thankfully and we have some pretty savvy peope in our family to help. I’d definitely pay for car report too. Too many horrible stories abouy people selling stolen cars etc

  5. Sounds like you have a solid plan! I’m glad you’re not rushing out and buying something expensive. Sometimes thinking on it for a while is the best thing. Saving to pay in cash is always an awesome idea too =)
    Holly@ClubThrifty recently posted..Our Frugal Trip to Canada and Niagara FallsMy Profile

  6. It’s good that you have a plan in place before you start car shopping next year.
    Kayla @ Shoeaholicnomore recently posted..Financially Savvy Saturdays Ninety Fifth EditionMy Profile

  7. Both our cars are at least 10 years old and two-doors. With a baby on the way, we really need a family car. We’ve been trying to figure out what the cheapest option, and because both my husband and I will be doing daycare pick up and drops off, we both really need new (to us) cars.

    Such a big expense and we knew it would happen.. trying to figure out what we work out.

  8. I was searching around for some car buying tips and for some reason I stumbled on your story. We are not looking for a second car but one that we could replace with the one we have. I hope you acquired the car. We are also looking a for a car that does the job, not the most luxurious one but one around $8,500. I really like your plan on acquiring the car.

    Cindy

  9. People usually don’t remember that there are other costs associated with having a car than just the monthly payments. That’s why I’m glad you mentioned the registration. I will have to remember to budget that in when we get around to buying a second car!

  10. These are all very important aspects to consider! Buying a second car is a great decision but you have to make sure you take time selecting just the right one!

  11. You make a good point about considering a target price. Considering additional costs is just as important, as you shared.

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How We’re Going To Afford Purchasing a Second Car

I have made mention that we were looking to get second vehicle. We’ve done well with one vehicle for some time but with my commute to work, Maria’s involvement in activities increasing and Mike still occasionally traveling out of town for work (taking our only vehicle with him), the time has come. We were hoping to wait until the debt was paid off but neither one of us is interested in the scramble that we have going on now any longer than we have to. We would 100% be screwed if we didn’t have our family to rely on. While I love them, and know they don’t mind helping us out, we would like the independence from them and their vehicles.

Before we could figure out a timeline about when this purchase is going to happen, we needed to figure out a target price. The car we buy will be used and likely a private sale. We also need to consider additional costs involved such as registration and paying for something like a CarProof report or mechanic exam. The last thing I want is to buy a car that I later finds out has a lien on it or something!

After doing a few days of research, we decided a target price of $5,000 would get us the kind of vehicle we’re looking for. Moderate mileage, safety inspected done, reliable and less than about 8 years old. We want a car that’s easy on gas since we have a SUV crossover now that isn’t so great with city driving (but satisfies our requirement for a larger vehicle for Mike’s work equipment). We’ll save an additional $500- $1,000 with a max savings target of $6,000 which will be able to take care of stuff mentioned above such as registration.

In order to do this, changes will have to be made. We’re not going to start saving for this until November at the earliest. We want to finish paying off the loan we’re currently working on before we look at saving for a car. As long as stuff like hot water heaters stops breaking on us we should be on target to have this loan paid off in October and start saving for the car by November. I’m not interested in buying a vehicle in the winter (in case we don’t get winter tires with the purchase it’s a cost we could save up for), so we won’t buy until probably May 2016.

This gives us seven months to save $6,000, a monthly target of about $850. Given that we put a minimum of $1,000/month towards this current loan, alone, I know the money will be in our budget, it does however mean that the next loan in line to be paid off will be delayed. It will still be getting some additional payments (anywhere from $150-$400 extra per month), it won’t get the full payment until after we buy the car. It’s too far in the future to know if we will be able to ”make up” the money we’re putting into the car, which is lost in extra debt payments, but I sure hope even with a $5000-$6,000 setback we can still meet out target of November of 2017 to be (non-mortgage) debt free, I’m just not 100% sure how I’m going to make it happen!

To find out what car we got check out this article. To get tips on how to buy your next car read the other two.

We’re Officially a Two Car Family Again
How to Get out of an Underwater Car Loan
How to Successfully Buy a Used Car

Enjoy Plunged in Debt?

Pid

Subscribe to get our latest content by email.

Powered by ConvertKit

  1. Can you really get something that decent for $5,000? I’ve looked through ads quite a bit at some point when trying to decide how much we should save towards a car replacement fund in case our car dies. Prices for something decent (mileage around 100K, no frills 4-door sedan with no fancy brands) hovers around $10K. May be in your area cars are cheaper.

    1. Ed says:

      Three years ago I bought an ’03 Alero 4dr used with 114k miles for $5,000. While it’s not the most fun car, it’s been a good enough daily driver for work. Sure, I’ve had to replace a part or two, but even then.. the car has cost less than $160/mo amortized since then. Not bad a return on investment for something that will loose value.

      1. Catherine says:

        Yeah exactly that’s all we’re looking for too!

    2. Catherine says:

      Again private sales but there were quite a few options…a few that I remember were an 07 Passat for 5500, 08 corolla for around the same…those are the “types” of cars we’re looking at. Reliable sedan.

      1. Good for you. Sounds like you’ve got it figured out 🙂

  2. I think that it is great that you have a plan and not just running out and getting the next hot car on the market. If more people approached all large purchases this way, there wouldn’t be so many people in debt.

    1. Catherine says:

      Agreed! I will never buy a brand new vehicle again.

  3. That’s so cool. Getting a second car is possible if budget permits and there’s enough savings. Being in debt free first then start saving for a car is best way to do. Good luck!

    1. Catherine says:

      Thanks Jayson!

  4. Jordann says:

    It sounds like you have thought this through, and you have a plan. This does not sound like an impulse purchase, so I say go for it! My car is eight years old and a standard (which I hate on Halifax hills!) and I’ve been itching to replace it, but my frugality is preventing me at the moment. When we do go for a replacement (within the next three years most likely), it’ll probably be a four year old lease return from the dealership, similar to what we got last time. I’m just not competent enough with cars to do a private sale. I’d have to make good friends with a mechanic between then and now.

    Can’t wait to see what you guys end up buying. I can already see the difference how you’re approaching this and how you would’ve approached it before paying off your debt, which is a great thing.

    1. Catherine says:

      I’ve never had problems with private sales thankfully and we have some pretty savvy peope in our family to help. I’d definitely pay for car report too. Too many horrible stories abouy people selling stolen cars etc

  5. Sounds like you have a solid plan! I’m glad you’re not rushing out and buying something expensive. Sometimes thinking on it for a while is the best thing. Saving to pay in cash is always an awesome idea too =)

    1. Catherine says:

      Oh geeze yeah we’re not going to get a car payment!

  6. It’s good that you have a plan in place before you start car shopping next year.

  7. Both our cars are at least 10 years old and two-doors. With a baby on the way, we really need a family car. We’ve been trying to figure out what the cheapest option, and because both my husband and I will be doing daycare pick up and drops off, we both really need new (to us) cars.

    Such a big expense and we knew it would happen.. trying to figure out what we work out.

  8. I was searching around for some car buying tips and for some reason I stumbled on your story. We are not looking for a second car but one that we could replace with the one we have. I hope you acquired the car. We are also looking a for a car that does the job, not the most luxurious one but one around $8,500. I really like your plan on acquiring the car.

    Cindy

  9. Kayla Rogers says:

    People usually don’t remember that there are other costs associated with having a car than just the monthly payments. That’s why I’m glad you mentioned the registration. I will have to remember to budget that in when we get around to buying a second car!

  10. These are all very important aspects to consider! Buying a second car is a great decision but you have to make sure you take time selecting just the right one!

  11. Christina says:

    You make a good point about considering a target price. Considering additional costs is just as important, as you shared.

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