Why I Sold My Weekend Car
Last year I was laid off from my employer. Out of excitement for 2 months of paid severance and about $10,000 in fun money, and kind of a fuck it mindset, I decided to buy one of my dream cars, a Scion FRS. It was a bit of a mid-life crisis impulse buy at $18,000, but "treat yo self", right? Any I did! I financed the car for the first few months and then paid it off in cash.
For the first few months I actually felt amazing. I loved the car, named her Julia, made plans for upgrades, sped up to 100mph at any chance I got. I felt like I was Batman! I was racing through traffic as if I was chasing the Joker. However, that feeling began to quickly fade. After 4 months and a new job, Julia was only being driven every other weekend. Then 2 months passed by and I didn't driver her at all.
I was into my 8 months and then I started to drive her to work to show off, which was convenient,because at the time I didn't pay my tabs on my commuter car and was feeling too lazy to stand in line. After 1 month of driving Julia, I noticed new scratches, dents, and grime from the commute drive. So, I decided to go back to weekends only. Now I am into 12 months of ownership and I am just over her. I have completely lost interest. Then I started to think about the potential financial waste I was creating.
What was the monthly cost of even having the car seat and do nothing? So, I decided to crunch the numbers and see if Julia is really worth having at all. Here was my process.
How much did a month it cost to have her on my insurance? $145
How much was regular monthly maintenance? Including car washes, oil, etc? ~$100
How much was gas each month? Sporty car required premium gas? ~$30 (driven 12 days a month)
So roughly $275 a month or $3,300 a year.
That didn't seem to bad, but then I had a kick to the gut. I looked at the KBB on my car value and it was $12,500. I had lost over $5,000 in value after 13 months of ownership. The more I drove it, the more the value was going out the door. So, I decided to sell Julia and recoup what cash I could from my stupid purchase.
Unfortunately, the dents and scratches did not count in my evaluation and I ended up selling at $11,000 through a dealership, which was fine honestly. I didn't want to deal with a million cheapos on craigslist and wasn't going to spend as much time into advertising. I sourced the car to 3 dealers and $11,000 was the best price with the least amount of work (my kind of deal).
After selling Julia, I Ubered home and invested the $11,000 check. It has been 2 months since I invested the cash and am now seeing a monthly return of $139.70 a month and it is growing as I continue to compound those dividends.
I learned from this experience, were quite a few things about myself.
Stuff only interests me for a pretty short time. Stuff just isn't as important to me as I thought. Next time I might rent a car if I want to drive something fast for a day. I will stick to practicality over sport and style.
Even cars with no payment and barely driven can affect your budget and future financial goals pretty significantly. Especially if you don't use it for work or to generate any income.
This experience and self-assessment has helped me build some barricades to prevent myself from impulse buying
I hope this learning will help prevent you from making the same impulsive mistakes I have made.