After graduation, I’ll inherit my parents’ 10-year-old Honda. Originally, Mom was going to buy me a new car as a graduation present, but after discussing it with her, we’ve decided that I’ll get Dad’s old Accord. I don’t really mind. True, it would be nice to be driving a shiny new whatever, but the lower car insurance alone on an old car will make it worth it to me.
According to this calculator, a $20,000 car, with a $2,000 down payment, $4,000 resale value, 9% interest rate, and 48-months financing will cost $348.39 per month. Since I am a recent college graduate with a short credit history, I won’t qualify for the best rates.
During the 6 months after graduation I am trying to save aggressively for my emergency fund because I won’t have student loan payments (yay for the grace period). Getting a new car, or even a “new” used car, would get in the way of that goal and have some not-so-short-term ramifications.
I don’t have enough money to save as much as I want to for retirement and emergencies, AND pay for a car loan, (and, you know, live). A new car would be nice, but I guess at the end of the day I’d rather have more savings and nicer meals out.