If you’ve made it to this page, there’s a reason you’re wondering whether or not you should sell your car. Here, we will discuss the different reasons you are looking to sell and if you should sell. Let’s explore what considerations should be made in determining if the time is right to sell your vehicle.
Is the vehicle no longer fitting your needs/lifestyle?
In many cases, your lifestyle may have had a dramatic change. If you have a 2 door sports car and suddenly find out you and your spouse are expecting, it may be time to consider swapping out for a sedan or the inevitable minivan. (They may have gotten a bad rap, but minivans are a parent’s dream when it comes to loading up the kids.)
Check your vehicle’s worth
Use FIXD’s Vehicle Value Tool to get an idea of how much your car is worth. Then, decide if it is worth selling or keeping. In some cases, the vehicle may be worth keeping as a secondary vehicle rather than selling for a few thousand dollars.
Is the car costing too much to keep?
A good idea to find out your actual cost of operation is to add all of the expenses together and come up with a monthly cost. You can then compare it to the vehicle you are looking at replacing it with or the cost of not owning a vehicle altogether.
Here’s an equation to calculate the monthly operation cost:
Car payment + Car insurance + average fuel cost for one month of operation + parking cost + (total your repair/maintenance cost for the last year of ownership and divide by 12 to get an average) + (total your yearly registration fee and inspection cost and divide by 12 to get a monthly average)= Monthly cost of operation
Now, this seems like a lot, but the main things to consider when comparing vehicles are the cost of maintenance, the grade of fuel required to operate, fuel mileage, and the cost of car insurance. These four things alone can drastically affect the actual cost of ownership. Many times people buy a high-end car and are unaware of the expense of operation. Here is a brief comparison:
- The vehicle may run on premium fuel. Premium fuel is on average 60 cents more per gallon than regular fuel.
- The vehicle may take synthetic engine oil which averages $70 per change but can be as high as $100, whereas the average standard oil change is $38.
- In some cases, the parts required to repair the vehicle may be expensive.
- Some cars will have higher insurance rates based on the type of car. I.e sports cars have a higher rate due to the fact that they are usually driven in a riskier manner.
My monthly payment is too high
In some cases, if your car payment is too high you may want to look into refinancing your existing car note instead of selling. In many cases your credit score may have gone up from when you first purchased, the credit rates may be lower than when you first purchased, or you may have gotten a bad rate altogether. You may now be able to get a better rate and drop your monthly payment.
No one wants to constantly worry about car problems and costs. If you are worried about it being unsafe to drive and are having multiple repairs made one after the other, you may want to get a newer car or look into ridesharing or public transportation.
Is getting rid of my car altogether worth it?
One of the newer trends is getting rid of your vehicle altogether and exclusively using public transportation and/or ridesharing apps. In some cases, this is a monetarily wise choice, but for some, it is not. If you don’t live in a centrally located point, this can get expensive quickly, but if everything you do is relatively close or you live in a densely populated city, it may be worth it. To find out, simply do the math of owning your car and its monthly operation cost and compare it to the cost of ridesharing and using public transportation.