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Morendil comments on Advice request: Buying a car - Less Wrong
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Comments (22)
Most important piece of advice I can think of: purchase cost is only a small fraction of what you'll spend on the thing. Base your decision on total cost, which will include parking, insurance, gas, tires, repairs and depreciation (decline of resale value).
Be sure to question the root assumption "I need to buy a car". Depending on where you live there may be alternative modes of transportation (e.g. public transport, self-powered) or alternative modes of use (long-term rental, car sharing, or complementing non-car transport with occasional rental).
That's a good point. Is there any way to get an idea of how much a car will cost in maintenance etc? Fuel economy is easy but I'm not sure how to work out how much a car will cost for replacement parts, maintenance, etc.
I'll see if I can check how similar cars have fared in depreciation using second hand car listings, although if anybody knows a more efficient way to do this it would be very handy.
Unfortunately in my circumstances (area, job, lifestyle), some form of motor vehicle is pretty much vital.
Google will give you pointers to various TCO calculators, I'd try Googling "car TCO" with your city name to narrow it down. These omit some actual costs (parking, etc.) but will give you a rough idea. Also keep in mind that fuel costs are likely to keep rising.
That's probably a good place to start. I'm in somewhat similar circumstances, and I've been paying a lot more attention to TCO calculations than purchase price except insofar as I can afford the latter without going into debt -- not that it's rational to have an absolute aversion to debt, instrumentally speaking.
Unfortunately, the data behind all the online TCO calculations I've been able to find is usually rather opaque. I'd feel better about it if I knew where all the numbers were coming from.
Is it vital that you own it?
Buying and selling used cars correctly on the depreciation curve makes owning a car almost as cheap as public transportation for me. YMMV.
For me the issue isn't the cheapness of public transport, but the availability. Where I live (outer eastern suburbs of Melbourne) the public transport system is a hopeless mess. Buses are the only way to travel unless you're going radially to or from the city centre (I do use trains to go to uni when I have to travel during rush hour times), and they are unreliable, infrequent, and take long winding routes through backstreets that add huge amounts to travel time.
When I was living in London I was amazed at what a joy it was to live in a place with such a well-run, useful public transport network. It made me sad when I came back home.