On New Year’s Eve, my husband and I were coming home from a trip to suburbia to a walk-in clinic so I could get a prescription for an ailment. It was about 9 in the morning, and there was no traffic because it was Saturday. We stopped at a red light and felt something…weird happen to our car. Like it was extra sluggish when the light turned green and my husband hit the accelerator.
As we pulled into the driveway and I opened my door, the smell of burnt rubber hit me.
Oh great. What now.
The rear passenger wheel was noticeably hot, so I did what I always do when something goes wrong with our little 2007 Volkswagen City Golf: I Google the shit out of the symptoms.
After about 20 minutes I ascertained that one of the components of the emergency brake (the one on the left passenger side wheel) had failed to disengage when we took the car out of park out in suburbia, and we’d driven a few kilometers with it on. After engaging and disengaging the emergency brake a few times in our driveway, the problem appeared to resolve, but we were left wondering:
- When would this issue arise again?
- Was the car safe for my husband to take to work the next day?
- Would we do severe damage to the car by driving longer distances without knowing if the brake was engaged or not?
And of course, the most important question on my mind:
How much will this cost to fix?
Suddenly, 2017 spread out in front of my eyes, and I could see the repair costs piling up, as they had in 2016. Brakes, rotors, new summer tires, new winter tires, a windshield chip, and replacing part of the exhaust had culminated in almost $4,000 in maintenance costs for our little car, not to mention the stress of repeatedly going in for a standard oil change and coming out with a $1,000 bill. The City Golf had treated us well for many years but doing that many repairs in one year are enough to make anyone look less fondly on their sturdy little vehicle.
Would 2017 be the same?
As my husband and I discussed ways for him to get to work the next day (rental car? cab?) until we could get the vehicle’s brake looked at, I threw it out there:
Or we could just buy a new car.
A new car. I’d been saving for a new car since the beginning of 2016, but thanks to all of those repairs, I only had $780 in my “new car” account. I worried that we’d reach the end of 2017 in the same state, but with a car that continues to be worth less and less at resale.
I already knew what kind of car I wanted. Months of obsessive Googling had narrowed it down to a Subaru Crosstrek. It took me three minutes on Autotrader to locate a used 2014 Crosstrek with 60,000 kilometers for sale less than two kilometers away from our house at a local Subaru dealership.
All wheel drive for my husband’s snowy 5 am commute to work, towing capacity, a roof rack for our kayaks and better gas mileage were at the top of my list. I also wanted a vehicle that was not “too big” for a pair of DINKS but could also tote around a kid in a few years. The longevity of the brand was also appealing since I have no interest in having a car payment, and would love to keep the vehicle as long as possible.
It was a two-year-old lease return. I loved this because it knocked about $10,000 off the list price, without being so old that I needed to worry about anything going wrong with it over the next few years. I’m not an expert at buying a used car, so I’m not comfortable buying from a private seller, but buying a used car from a dealership is the next best thing for us non-mechanically inclined folk.
Finally, the fact that it was an automatic was the kicker. After being in a pretty terrifying highway car accident six years ago that involved a broken wrist for me and a totaled car, I’ve struggled with at-times crippling anxiety about driving. The City Golf, as great a car as it was, did not feel safe to me, ever. It was too low to the ground, and the manual gear shift meant I always felt like the car was in free fall when I put my foot on the clutch. Driving on the highway made me sweat, driving on the hills in downtown Halifax was a non-starter – I flat out refused. I don’t talk about this often to anyone, not even close friends, and family, but that anxiety is with me at some level every time I get behind the wheel.
After ensuring the City Golf’s rear brake really was disengaged, we headed over for a test drive. After driving the Crosstrek on the highway and in the city, I was sold.
The Money Part
As I mentioned, I hadn’t been able to save much money for the new car, because of the old car’s repairs. I had $780 saved, so I pulled another $4,220 from my emergency fund for a total down payment of $5,000. We went for the dealer financing, even though the rate was terrible because I knew I could transfer the balance of the loan to my line of credit (which has a much more favourable interest rate) later on.
They offered us $1,200 to trade in the Golf. Umm. No. We’ll sell it ourselves and use the money to pay back the emergency fund. After insisting they install a new set of winter tires and requesting a very, very clear breakdown of the fees and charges and questioning every line of the paperwork (the guy was really starting to hate me by the end of it), we had a deal.
Today, we owe $17,358 on the car at 4.7% interest. The emergency fund has already been paid back and is sitting pretty at $10,000, thanks to selling the City Golf (after getting the brake repaired, turns out it was a lubrication issue), for $4,000 on Kijiji to a nice young guy who wanted a manual car. Now the priority is getting that $17,000 paid off.
My Plan to Pay Off the Car Loan
I loved being car payment free for the past four years. That’s why I put off selling the City Golf for as long as I did, even though I hated driving it. Not having a car payment is the bee’s knees. I plan to return to that state as soon as possible. I’ve set up the car loan in a debt repayment spreadsheet and here’s my plan to pay it off:
- Budgeted monthly payments of $505.00 per month
- 25% of my gross freelance income
- All windfall money including extra paycheques and income tax returns
Based on my calculations, using the money above, by the end of this year I’ll have about $3,300 left owing on this loan. I could pay it off before the end of the year if I reprioritized some of the money I’ve put aside for renovations, but I’m really enjoying renovating my house, and I don’t want to postpone that a whole year. I’m hoping to get the car paid off this year; I’ll just have to stretch to do it.
This plan sure beats spending another year of repairs for the City Golf and trying to save for a new car. Then hopefully it’ll be another six years (or eight or ten? The car is only two years old at this point) of being car payment free.
Now I want to hear from you guys, when did you decide to replace your car?