What should I make my next car purchase?

I picked my 2020 OR 4x4 for $35K before all the taxes/fees. That sounds about right @ $36K then since there is such a shortage.

 

ferrari is a cool car, but a used tacoma will outlast it.
if its the last vehicle i will ever own i'll take the truck.

 

Did I hear teacher? We make shit money man & you’ll need that truck to drive to school in bad weather. Truck payments suck on a teachers salary - if you don’t have a masters - it’s way worse. Also, I have to go back to campus to teach in Jan 2021 - no vaccine & not allowed remote anymore because parents arnt making their kids get online. Over 50% of my high school is failing & parents have stop returning calls...

first new (used) vehicle question. Do you want a traditional car key or a new piece of shit car fob?

Also this is the worst time to buy a used car. Literally the worst time. I’d consider setting a date in 2022 & keep saving. That way you can methodically plan what you exactly want.

 

You do you, but that's the "smart" move. May not be the fun one, but you'll save a lot of cash driving an $8k car while your friends who are driving $40K cars will be broke.

In 5 years, pay $30K cash for a Tacoma with your savings.

 

Whats the salary in your area? And I am currently a TA I love it and can't wait to be a teacher. I might end up buying new instead of used because it's more beneficial. And I currently don't have a vehicle so I can't wait a whole year.

 

Ahhh man, ur there Shark. Time for a sub 3%refi and just buy the car

 

At least it doesn't have a rubber band as a transmission like the new ones....

 

In 5 years my goal is to have a house if not sooner. So I want to start paying towards the vehicle I want to stick with long run. Since right now I live with my parents and if I move I will split rent with someone at an apartment. No kids etc so less things to pay for compared to nearing my 30s

 

Dude ... I hear you ... and you are not wrong ... but there is another way. Sorry, not taking issue with your point of view but I love this kind of stuff, so please forgive me.

We also don't know that the OPs friends will be driving 40K cars and will be broke -- let's set that assumption aside for a moment.

Two scenarios:

A:
> Buy the new (or one or two year old Tacoma) now for $36K (as has been stated)
> I would put some down but hold the $8K (but that is debatable)
> Reliable truck, under warranty and no additional car expense for 10 to 12 years (with the Tacoma)
> Get a job, save the money you are thinking will be available in in five years have a great truck and $30K in the bank

B:
> Spend $8K now (assuming nothing bad happens to the car in that time )
> Save money for five years
> Plunk $36K down (loose assumption Truck prices are not going up like mad, but we know they are)
> Will have spent $44K in that time period
> And have no money in the bank

Now those are not all of the details and assumptions ... just throwing out there that there is another option and that could be just as smart, if not more smart.

From a financial strategy perspective there is nothing wrong with saving your money (using it elsewhere after you have a cushion) and using smart financing to reduce your risk while increasing your financial portfolio.

Everyone's comfort level is different ... just saying that cash is not the only smart play by any means.

 

Buy now and rent it out. Keep living at ur folk's place until they can't stand you anymore or kick you out, lol. In 5-7 years trade up on real estate or buy another to rent out and don't leave your parent's house! You can thank me in 10.

 

HA !

I amend my financial strategy to add one bullet point: Live at home for as long as you can take it and double (or triple!) up on payments for said new Tacoma.

 

Lol I might be well of financially but I would probably go crazy. I dont want to live at my families forever lol nor am I crazy about real estate stocks im interested in though

 

To me it comes down to do it now or do it later. And getting another vehicle to then be in the same situation of getting a tacoma sounds like I'll spend more than I need to. Because whose to say when I get that cheaper car it won't have problems or when I sell it it won't depreciate like crazy.

 

If you know you’ll keep it until it falls apart, bite the bullet and do it now. Next thing you know you’ll have kids and a house and retirement to save for and you won’t have the flexibility to get the truck you want. There will come other priorities.

But you’d better be damn sure you’re keeping it. You’ll waste money bouncing between vehicles.

 

For me, personally, it is a no brainer. Do it now. Solve the problem for pretty much 10 years. There are no guarantees, of course, but I'd rather have a new Tacoma (possibly with an extended warranty) than an $8K car that introduces all kinds of risk.

And frankly I wouldn't worry about depreciation at all. Both will depreciate (the Tacoma far less so according to the data) but to me safety and reliability outweighs that other stuff. If you are keeping the new truck for 10 to 12 years -- very possible and very easy to do with a Tacoma, depreciation is not an issue.

 

Keep in mind that wrenches WILL fall into the best laid plans. Paying for a vehicle and a home is quite a burden. A car loan is 5 years, a home loan is 30 years... sh*t will happen in those year - guaranteed.

On top of the commitments - an emergency fund is necessary. Not providing for this is how people meet the repo man, and have to give back the house keys to the bank...

It takes work and quite a bit of time to get prepared... I think best to be patient and get a better shot at enjoying the benefits of your work... Rather than getting in debt - spending money not yet earned...

 

Look at an ‘05 Camry and an ‘05 Tacoma and compare used prices. You’ll get a lot more on the back end when you go to sell 10-15 years down the road with a Tacoma if that’s what you choose to do even though it’ll cost more initially. My vote is for the Tacoma, but this is just something for you to consider. Best of luck!

 

You could also lease a vehicle. Lots of cheap Toyota lease deals and invest your money and then later you can decide to keep it or return it. Works if you are not putting a lot of miles on it.

 

I’ll say get a Tacoma, but maybe go ask around at camryworld just to be sure.

 

Buying now is really a tough time. Everything new and used is low supply higher demand.
Congrats on the low interest rate, usually that means you have good credit which is an accomplishment these days.
I'd say you should get what you want and if it's a truck find a reasonable way to make it fit your monthly budget. Saving a good big down payment helps. You may want to wait it out until cars aren't as in demand if you can and save more.

I kinda was in the situation where I wanted a new vehicle and at over 40 never bought anything but used. I had to save for around 2 years to get my Tacoma SR5. I wasn't even going to spend on a trd. But i wanted a payment that I could afford with out streeching my budget too far. I only borrowed like $23k buy putting 14k down, then selling my old Liberty CRD to get more for it. I then used that to buy a tonneau cover and pay down my loan.
I made it work because I was able to hold out until I had it all worked out and it helped that my Jeep was good enough that I didn't need to go get a car immediately.
I would say if you really want a Tacoma try to make it work, save more money if needed and you can hold off on a car for some time.
If not well camry is still a great car.