New or used vehicle for new graduate with job?

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camper1
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New or used vehicle for new graduate with job?

Post by camper1 »

Our son is graduating in May and starting his first civil engineering job in June. He worked hard and we are very proud parents :D He will be relocating (company sends engineers to various projects around the country-typically relocate every 1-2 years). He needs to replace his current 1999 Toyota Camry with 200,000 miles with a more dependable car by May.

He would like a new or late model small Toyota RAV4 or Honda CRV with AWD. He may be living in areas with snow or extreme heat and will be driving to construction sites as well as possible long trips home for visits. Also, plans on using for "car camping" and visiting national parks. Priorities are dependability, good mileage, suitable for extreme weather and construction sites, style and comfort. Lower priced sedans will not meet his needs.

He will not get first paycheck until end of June and will be making a good salary and have some student loan debt. He will be paying for the car, but we are fine with lending money for a down payment if needed.

I always like to buy used and have been looking online at RAV4's and a 2016 with lower miles seems to run about $18,000-$20,000 at Budget Car Sales, CarMax, and local dealers. Most are off of warranty and we would finance with our credit union (requiring 10% down and approx. 3% for 36 months)

However, in this situation should he consider new? (factory warranty, no down payment, low .9% 36 month financing rate, new grad rebate) 2018's seem to be advertised at around $25,000 (RAV4 AWD). Also, we haven't looked into any leftover new 2017's which may be less.

Could this a situation where the boglehead decision may be to buy new? Is there a logical way to compare from an economic point of view? Either way, he plans on keeping the car for a long time. Also, any recommendations if this is the best time to buy for deals or should he wait until closer to May when he needs the new car?

Thanks in advance!
psteinx
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Re: New or used vehicle for new graduate with job?

Post by psteinx »

camper1 wrote: Wed Jan 31, 2018 10:56 amCould this a situation where the boglehead decision may be to buy new? Is there a logical way to compare from an economic point of view? Either way, he plans on keeping the car for a long time. Also, any recommendations if this is the best time to buy for deals or should he wait until closer to May when he needs the new car?
In my opinion, people around here get too stuck on what's the "Boglehead" approach, *particularly* for areas outside of the core focus of these forums (financial investments). Just because you read these forums and use low cost mutual funds doesn't mean you should or must buy the cheapest possible car, etc. And sometimes cheaper up front does not equal cheaper over the longer term.

Your son will likely drive this vehicle for years. A new one will cost a few thousand more up front, but even that difference may be mitigated by lower financing rates generally available to good credits on new cars. Then there's warranty, ease of shopping, and so on.

Of course, compare the options, run the numbers, etc. But don't be surprised if a used vehicle turns out to be almost as expensive, with proper analysis, as a new one.
bloom2708
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Re: New or used vehicle for new graduate with job?

Post by bloom2708 »

Do you want to saddle your son with a nice car loan payment before he has even gotten a single paycheck?

I know that is the "American Dream". He will have student loans, rent and a car loan to accompany him on the way to a first paycheck. Start off his 401k with a 2% contribution because no money left after rent and debt payments.

To me, regardless if you pick used or new, it is doing things in the wrong order. What if he worked and saved up for a down payment?

A new graduate does not need an $18k or $25k car with the associated loan to kick off his working career. How about a nice $8-10k step up?

If you are well off and want to buy him a new car, that is another topic. "He would like a...." worries me a bit starting off.

Just my thought reading the post. People want to "fast forward" their lives before their means meet the end goal.
Last edited by bloom2708 on Wed Jan 31, 2018 11:31 am, edited 1 time in total.
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Pajamas
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Re: New or used vehicle for new graduate with job?

Post by Pajamas »

I think that a new car would make a nice graduation gift to him from his parents. Just be sure to let him pick out the exact model and options that he wants himself.
soccerrules
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Re: New or used vehicle for new graduate with job?

Post by soccerrules »

I bought a new car with cash 12 years ago. It now has over 200K in miles.(haven't bought new since - 5 cars)
I bought a used car last summer for our graduate (off the payroll gift). $14-15K range. 3 year old mid-sized SUV with 40K miles.

It really depends on what you want to do. There are probably a number of different options that come down to personal choice and some that might be better financially.

I would try and determine the best value for your dollars. if you can get a 2017 "new" for $1-2K more than the used ones you referenced, it might be a good option.

Paying cash typically get's you the best price.

If you are basically helping your grad set-up a loan on top of the student loans -- I would be cautious to set them up with a debt backpack.
Don't let your outflow exceed your income or your upkeep will be your downfall.
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lthenderson
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Re: New or used vehicle for new graduate with job?

Post by lthenderson »

I bought a new car a month before my graduation without any student debt or any other debt at all except for the car loan and regretted if for quite awhile into my new career. Setting up a new life is expensive. There are down deposits for the new apartment/house that must then be populated with dishes and furniture. With my new found freedom from school, it cost quite a bit of money to socialize with my new coworkers, etc. It took me a good year of living in very pauper like conditions until I got the car paid off and built up a cushion in my checking account so that I didn't have to live paycheck to paycheck.

My advice would be to set your sights lower on a used vehicle with more miles. You can get very reliable vehicles much cheaper with 120k+ miles on the odometer that will see your new graduate through a handful of years until they are able to afford a new vehicle. Personally saving a few thousand dollars to get a low mileage used vehicle over a new vehicle isn't worth the risk of uncertainty of how the previous owner treated the vehicle.
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camper1
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Re: New or used vehicle for new graduate with job?

Post by camper1 »

lthenderson wrote: Wed Jan 31, 2018 11:32 am My advice would be to set your sights lower on a used vehicle with more miles. You can get very reliable vehicles much cheaper with 120k+ miles on the odometer that will see your new graduate through a handful of years until they are able to afford a new vehicle. Personally saving a few thousand dollars to get a low mileage used vehicle over a new vehicle isn't worth the risk of uncertainty of how the previous owner treated the vehicle.
OP here. I considered this, but a quick look at prices for Honda and Toyota small AWD cars with high miles are crazy. $8000-$10000 range. My concern with that is reliability and he still would need to finance and save for a future car. ( a previous poster suggested it would be a nice graduation present- but after putting 4 kids through private H.S., 2 currently in college and one still in H.S., we are not considering providing cars for graduation presents!)

I agree that we should not be encouraging our son to add more debt and I agree he should be paying cash for a car. I just don't see how that could be done in his situation which requires long distance moves and a reliable vehicle.

I am curious how other parents in our situation advised their children concerning car purchases. I would be interested if anyone has looked at a way to compare long term costs of new vs late model vs older model for high resale value cars such as Toyota and Honda and what they ended up choosing.
jojay
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Re: New or used vehicle for new graduate with job?

Post by jojay »

First off, congratulations to you and your son. Graduating from college is no small feat especially in civil engineering. The fact that he already has employment is another point worth acknowledging.

Our soon to be 23 year old has a BS and will be getting her MS in June so she is in a similar condition. She will be staying local in New England and thus, she needs ( or her parents want ) an AWD vehicle.

Our plan was always to "sell" her my 2009 Highlander with 165k miles for her first car. We have discussed that versus other options. She has minimal school debt, accumulated about $11k in savings and has shown remarkable maturity and discipline while in school, working and doing well in both. She wants a new car. Me being frugal says "no" - after all I did not get my first new car until 40 plus. But - and she is very, very financially conscientious (she is my daughter after all) - she does not want a dented, dirty, driven to the dump regularly vehicle and wants to get something else. Plus, newer vehicles have lots of safety features my Highlander with a cassette player lacks.

So this week, we bought a 2018 Honda HRV. It is smaller than a CRV but still roomy and gets 31 mpg combined. All in, we paid $21,385 - by all accounts a steal. We know how to buy new cars so we know we did well.I think we hit it right walking in at the end of the month and so on.

Our children are not us. Your son has done well. Yes, he should pay off loans, have an emergency fund, start his 401, his HSA, save for a house and so on. But, he sounds like he will do that - he has the discipline. As much as this flies in the face of some of this website's philosophy, let him live a little.
bloom2708
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Re: New or used vehicle for new graduate with job?

Post by bloom2708 »

Starting the car search with a CRV or Rav4 is going to be tough. High demand. Cars that others are looking for. You should still be able to find one with 50k to 80k miles for a reasonable price.

Is there any reason to think the Camry won't make the trip? Maybe sink $1,000 into updating some maintenance items. New tires, brakes, fluid changes. Let him get settled, get a few paychecks. Get a look at his budget. Start putting money in the 401k pre-tax.
Last edited by bloom2708 on Wed Jan 31, 2018 4:48 pm, edited 1 time in total.
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adamthesmythe
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Re: New or used vehicle for new graduate with job?

Post by adamthesmythe »

Given that travel is part of the job, and that civil engineering tends to be done in places that are remote, icy, muddy, and unpaved, a new crossover is a reasonable choice. PROVIDED other parts of his spending are under control.

Most of the cars (or pickups) I can think of that are suitable have high resale values. Some new car dealers may have special offers for new graduates. A new CE makes a respectable salary and payments on a reasonable new vehicle will not be a problem.
shawndoggy
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Re: New or used vehicle for new graduate with job?

Post by shawndoggy »

every civil engineer I've ever met who has to do work on remote sites has a 4wd pickup truck, not an awd car wagon like a crv or rav4. The crv and rav4 are great for snow, but neither is really meant for off-roading at all, if that would be required for the off site work.

I'd have him keep his hooptie for a year (or even six months) and see what he really needs. Getting into a car payment also makes it harder to bail out of the new job if it turns out it's not for him.
WhiteMaxima
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Re: New or used vehicle for new graduate with job?

Post by WhiteMaxima »

New graduate. Em. VW GTI Sport 6MT.
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djpeteski
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Re: New or used vehicle for new graduate with job?

Post by djpeteski »

There are several things in your post that concern me:
camper1 wrote: Wed Jan 31, 2018 10:56 am He needs to replace...
Does he really need to replace? I drive a car with 200k miles on it, and could easily justify a new car, but I don't need to. Pehaps a new tune up and tires will refresh the car.
Lower priced sedans will not meet his needs.
Those are wants, not needs. I suspect his existing car can meet his needs.
will be making a good salary
That is a total relative statement. I recall having a conversation with someone who claimed that he made a lot of money at his job. I claimed that my job paid me "peanuts", and I made about 5k/year more than him.
and have some student loan debt.
An indication that he cannot afford a new car, or car payment. Make this zero first.
we are fine with lending money for a down payment if needed.
That is not wise. If you can afford to give it, then do so, but do not loan.

My son recently graduated college and he was able to purchase a gently used Ford Escape for 10k. He worked during college, so he had the money to pay for it. If your son is making good money, he could save up and pay cash for such a purchase in 5 to 6 months. Have him do that. He does not need to get into the treadmill of car payments that plagues most US households.

If you want to borrow money at zero percent, and keep the balance in investments, fine, whatever. However that is not the same as most people with car payments. Most are buying way more car they can afford. Paying cash mostly protects against that.
miamivice
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Re: New or used vehicle for new graduate with job?

Post by miamivice »

(I didn't read the question, just the title)

I have kept extensive records on the maintenance, miles, and depreciation of all of the cars I have owned since graduation, about 15 years ago. I've always bought used, although recent purchases are much newer than when I was first out of college.

The results aren't necessarily suprising: The older cars that I purchased depreciated much less than newer cars, but they required more cost in maintenance. In fact, they required so much maintenance that much of the savings that I have achieved by buying used has been wiped out by maintenance. This in spite of the fact that I have done as much maintenance as possible myself.

Now, I might have been dealt a bad hand (unscrupulous mechanic overcharging and doing shoddy work) or bought an unlucky vehicle, but that's my overall experience after about 6 vehicles and just over 400,000 miles.

In short:

6 cars
426,000 miles
Depreciation: $30,250
Repairs: $18,280

Total cost: $48,000 or $0.12 per mile.

Note I didn't put tires or brakes in there because they are a maintenance cost rather than repair cost.
bubbadog
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Re: New or used vehicle for new graduate with job?

Post by bubbadog »

shawndoggy wrote: Wed Jan 31, 2018 2:55 pm every civil engineer I've ever met who has to do work on remote sites has a 4wd pickup truck, not an awd car wagon like a crv or rav4. The crv and rav4 are great for snow, but neither is really meant for off-roading at all, if that would be required for the off site work.

I'd have him keep his hooptie for a year (or even six months) and see what he really needs. Getting into a car payment also makes it harder to bail out of the new job if it turns out it's not for him.
This seems like a reasonable approach.
Texanbybirth
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Re: New or used vehicle for new graduate with job?

Post by Texanbybirth »

bubbadog wrote: Wed Jan 31, 2018 3:12 pm
shawndoggy wrote: Wed Jan 31, 2018 2:55 pm every civil engineer I've ever met who has to do work on remote sites has a 4wd pickup truck, not an awd car wagon like a crv or rav4. The crv and rav4 are great for snow, but neither is really meant for off-roading at all, if that would be required for the off site work.

I'd have him keep his hooptie for a year (or even six months) and see what he really needs. Getting into a car payment also makes it harder to bail out of the new job if it turns out it's not for him.
This seems like a reasonable approach.
Agreed, and just love seeing the word "hooptie".
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Liberty1100
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Re: New or used vehicle for new graduate with job?

Post by Liberty1100 »

From my personal experience, I would wait for a couple of months into his job before buying as he will have a better sense of what he needs versus what he wants.

I would see how much of his income he actually pockets without a car payment first. He may not realize how expensive living on his own is. Things like internet, Netflix, Amazon Prime, heating/ac, rent, contributing to his 401k, IRAs, and then adding a larger than needed car payment may put some stress on him (I didn't know how expensive health insurance really was until I turned 26 for example). He may want something with more features, but he may not understand that that's an extra $200 a month for the length of the loan and that he doesn't have the cashflow for it, for example.
Helo80
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Re: New or used vehicle for new graduate with job?

Post by Helo80 »

soccerrules wrote: Wed Jan 31, 2018 11:24 am Paying cash typically get's you the best price.


In the past that might have been true. Nowadays, there are so many lenders and kickbacks from dealer's lenders and incentives from the financing arms of the makers that it makes little to no difference. In some cases, you might get a better price going with the dealer's lender b/c of the kickbacks.

Just to be clear, if a dealer says a car is $20 grand, it's $20 grand whether you pay in cashier's check or your bank/CU's check. If you use the dealer's financing, there may be a kickback from the lending company to the dealer that may or may not get passed onto you unknowingly in the sales price... my guess is it's not passed onto you. With houses, yes, an all cash offer can be more powerful than a higher finance backed offer for a plethora of reasons that we can all reasonably agree upon.
Last edited by Helo80 on Wed Jan 31, 2018 4:25 pm, edited 1 time in total.
Helo80
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Re: New or used vehicle for new graduate with job?

Post by Helo80 »

psteinx wrote: Wed Jan 31, 2018 11:13 am In my opinion, people around here get too stuck on what's the "Boglehead" approach, *particularly* for areas outside of the core focus of these forums (financial investments). Just because you read these forums and use low cost mutual funds doesn't mean you should or must buy the cheapest possible car, etc. And sometimes cheaper up front does not equal cheaper over the longer term.


Quite possibly the best and most concise statement I have ever read about cars on this forum. BH is wonderful for investment advice --- not so much for car buying, car maintenance, etc.
stimulacra
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Re: New or used vehicle for new graduate with job?

Post by stimulacra »

shawndoggy wrote: Wed Jan 31, 2018 2:55 pm every civil engineer I've ever met who has to do work on remote sites has a 4wd pickup truck, not an awd car wagon like a crv or rav4. The crv and rav4 are great for snow, but neither is really meant for off-roading at all, if that would be required for the off site work.
What are the odds that the 4WD pickup truck is the civil engineer's personal vehicle versus a work vehicle or reimbursement?

Seems like buying a new pickup truck to visit work sites is an unrealistic financial burden for a recent college grad.

I would look into a pre-owned CRV, RAV4, CX5 or Forrester.

Late model Outback would be the high end pick.
shawndoggy
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Re: New or used vehicle for new graduate with job?

Post by shawndoggy »

stimulacra wrote: Wed Jan 31, 2018 4:25 pm
shawndoggy wrote: Wed Jan 31, 2018 2:55 pm every civil engineer I've ever met who has to do work on remote sites has a 4wd pickup truck, not an awd car wagon like a crv or rav4. The crv and rav4 are great for snow, but neither is really meant for off-roading at all, if that would be required for the off site work.
What are the odds that the 4WD pickup truck is the civil engineer's personal vehicle versus a work vehicle or reimbursement?

Seems like buying a new pickup truck to visit work sites is an unrealistic financial burden for a recent college grad.

I would look into a pre-owned CRV, RAV4, CX5 or Forrester.

Late model Outback would be the high end pick.
I never said that the engineers I know have bought NEW 4x4 pickups. Just that that is the vehicle of choice. Don’t see why a late (or not so late) model used truck wouldn’t be worth considering. YMMV.

In any event it really goes to the second half of my post which is why not wait and See? Let actual experience be the guide rather than imagined needs. How many times have all of us arrived at a point in life where reality in that moment is quite a bit different than we’d imagined it would be way back when.
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3CT_Paddler
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Re: New or used vehicle for new graduate with job?

Post by 3CT_Paddler »

Civil Engineer here... Why does he need a new car? The first couple of years of employment I drove an old Honda Accord. I later upgraded to an old Infiniti QX. I now drive... an older Honda Accord. If you want to buy him something or contribute towards a car that is great, but a newer car is not needed. If he goes to job sites often he will typically have a company vehicle available.
soccerrules
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Re: New or used vehicle for new graduate with job?

Post by soccerrules »

Helo80 wrote: Wed Jan 31, 2018 4:17 pm
soccerrules wrote: Wed Jan 31, 2018 11:24 am Paying cash typically get's you the best price.


In the past that might have been true. Nowadays, there are so many lenders and kickbacks from dealer's lenders and incentives from the financing arms of the makers that it makes little to no difference. In some cases, you might get a better price going with the dealer's lender b/c of the kickbacks.

Just to be clear, if a dealer says a car is $20 grand, it's $20 grand whether you pay in cashier's check or your bank/CU's check. If you use the dealer's financing, there may be a kickback from the lending company to the dealer that may or may not get passed onto you unknowingly in the sales price... my guess is it's not passed onto you. With houses, yes, an all cash offer can be more powerful than a higher finance backed offer for a plethora of reasons that we can all reasonably agree upon.
That is part of the reason why i said "typically".
Also here are some other thoughts

1) Don't really trust the New Car buying process and some of the salesman/finance depts, I have encountered. I have always felt dirty after my new car purchases (prior to 2006 I bought 4 new cars over a 16 year period). I now buy 2-4 years old pre-owned vehicles, with cash that I have had checked out by a mechanic.
2) It seems to be well documented that buying new you absorb the full depreciation on a depreciating asset vs buying pre-owned and allowing someone else to pay that first 2-3 years of depreciation
3) Everyone should do appropriate research prior to shopping and especially before buying
4) As I get older, a car just serves a purpose of hauling people and stuff.
Don't let your outflow exceed your income or your upkeep will be your downfall.
smitcat
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Re: New or used vehicle for new graduate with job?

Post by smitcat »

miamivice wrote: Wed Jan 31, 2018 3:08 pm (I didn't read the question, just the title)

I have kept extensive records on the maintenance, miles, and depreciation of all of the cars I have owned since graduation, about 15 years ago. I've always bought used, although recent purchases are much newer than when I was first out of college.

The results aren't necessarily suprising: The older cars that I purchased depreciated much less than newer cars, but they required more cost in maintenance. In fact, they required so much maintenance that much of the savings that I have achieved by buying used has been wiped out by maintenance. This in spite of the fact that I have done as much maintenance as possible myself.

Now, I might have been dealt a bad hand (unscrupulous mechanic overcharging and doing shoddy work) or bought an unlucky vehicle, but that's my overall experience after about 6 vehicles and just over 400,000 miles.

In short:

6 cars
426,000 miles
Depreciation: $30,250
Repairs: $18,280

Total cost: $48,000 or $0.12 per mile.

Note I didn't put tires or brakes in there because they are a maintenance cost rather than repair cost.
Wow - 15 years and 426,000 miles.
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Cycle
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Re: New or used vehicle for new graduate with job?

Post by Cycle »

06 Accord or Camry with 150000 miles. Should cost 3k and last 100,000 miles or more.
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camper1
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Re: New or used vehicle for new graduate with job?

Post by camper1 »

OP here. Thanks for the variety of responses so far! This gives us some food for thought as we start the process.

I appreciate the responses to keep the 99 Camry, but the fact that he may be moving anywhere in the country and returning home for visits warrants a safe, reliable car. Current car has no air, one door that won't open and needs new exhaust system. If it were a local job I would agree that keeping the car makes sense.

I like the idea of waiting until he knows more about his needs. He should find out his job location about a month prior to starting so that may be worth waiting for to see how far away he will be and what part of the country. Perhaps AWD would not be needed.

He did say that during his co-op job most of the employees (including the construction workers) drove very nice trucks. Thankfully his supervisor drove an old honda civic and said the trucks were more for show rather than necessity.
Helo80
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Re: New or used vehicle for new graduate with job?

Post by Helo80 »

soccerrules wrote: Wed Jan 31, 2018 4:55 pm That is part of the reason why i said "typically".
I did see that, but I think "typically" is even the wrong adjective to be completely honest. Whether the money is coming from you or a lender, the dealership still cashes it. Once upon a time, cash today may have made a difference, but those times are long gone.

Observing and reading the demographic here on BH --- most people probably pay cash for a car, new or used. And I warn anybody reading this that if you think paying cash (personal or cashiers check) will get you much leverage, you're probably going to be in for a bad time. (Note: I can only competently make this assessment for branded dealerships. Indie lots... I have no idea....)
soccerrules wrote: Wed Jan 31, 2018 4:55 pm 3) Everyone should do appropriate research prior to shopping and especially before buying
That's the absolute best thing you can do to gain the most leverage in a new car sale. That's what dealerships hate the most.... knowledgeable people that know market conditions. It also helps if you are on no timeframe.
Helo80
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Re: New or used vehicle for new graduate with job?

Post by Helo80 »

camper1 wrote: Wed Jan 31, 2018 6:03 pm I like the idea of waiting until he knows more about his needs. He should find out his job location about a month prior to starting so that may be worth waiting for to see how far away he will be and what part of the country. Perhaps AWD would not be needed.

AWD will be a waste of money if he's in a fair weather climate. If he moves to say a Colorado or the midwest that receives all sorts of snowy weather, then seriously consider the AWD. AWD is also not 4WD --- so you mentioned camping and what not... not saying he's going to be doing trail riding or rock climbing, but thought I'd throw that out.
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Watty
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Re: New or used vehicle for new graduate with job?

Post by Watty »

You might find this post interesting about how I just bought a new car through the internet.

viewtopic.php?f=11&t=239526

This is the third new car that I have bought this way and it is relatively painless.

Late model used Toyotas and Hondas are usually not discounted enough to make them a good choice so buying a new one often makes sense. Unless he is looking at used cars that are more than five years old then buying a new Honda or Toyota likely is a good choice.

For used cars something like a Ford or Hyundai might be a better choice because they depreciate a lot faster.

I just bought a new Toyota Corolla and one of the things I found was that Toyota added a lot of advanced safety features to all of their cars starting in 2017(?). This includes features like automatic braking to avoid running into the car in front of you.

If he buys a used Toyota that is a few years old it may not have those safety features so be sure to check on that as well as other changes in specifications. Comparing a 2018 RAV4 for a 2015 RAV4 is not an apples to apples comparison.


I'm not sure about the safety specifics of the Honda CRV but to get the advanced safety options I would suspect he would have to get a higher trim level and maybe get a safety options package. Those costs could add up.

A few semi-random comments;

One problem he will have with buying a car now is that he may need to pay sales tax and registration in the state he is in now, and then pay some of those costs again when he registers the car in his new state this summer. Be sure to figure out how that will work. If he lives in a state with sales tax now and will be working in a state without sales tax then waiting to buy until he can register the car there will likely make sense.

There were a lot of cars flood damaged in the big hurricanes last year. He needs to be very careful with buying a used car now because there are way to get flood damaged cars retitled so that you will not see a history of the flood damage.

Be sure to get insurance quotes for the car before you buy it. Insurance on a new car for an under 25 single male could be VERY expensive especially if he has a less than perfect driving record. It might make sense for him to have an older car until he turns 25 just to save on the insurance.

For the road trips back home renting a car for a week is an option.

He will most likely be living in an apartment so his ability to work on cars may be very limited since some apartments don't allow you to work on your car in the parking lot.
BillyK
Posts: 75
Joined: Sat Sep 24, 2016 1:30 am

Re: New or used vehicle for new graduate with job?

Post by BillyK »

He needs to know whether he will be driving a company vehicle or his own on the projects, and the types of projects that he will be working.

I have worked for many years on both highway and transmission line projects throughout the country. Nearly everyone including the engineers drives pickup trucks for a good reason. 4 wheel drive ones with off-road packages are common in many areas that I have worked. Depending on the type of projects that he will be working, if he has to use his own vehicle to visit project sites, I would be real hesitant that a Honda CRV or Toyota RAV4 is the right vehicle for the job. A smaller truck such as a Toyota Tacoma would be a better choice.

Also, a consideration for a young guy working in many areas that I have worked, he will stand out as a geek for driving a CRV or RAV4. West Texas in the Permian Basin is a prime example. Plus, as someone that lives on the road all of the time, I have found that it is hard to beat a pickup truck for moving my stuff from one project to the next. I often rent a trailer to haul my items, so having a pickup truck that is a good tow vehicle helps too.
smitcat
Posts: 6996
Joined: Mon Nov 07, 2016 10:51 am

Re: New or used vehicle for new graduate with job?

Post by smitcat »

camper1 wrote: Wed Jan 31, 2018 6:03 pm OP here. Thanks for the variety of responses so far! This gives us some food for thought as we start the process.

I appreciate the responses to keep the 99 Camry, but the fact that he may be moving anywhere in the country and returning home for visits warrants a safe, reliable car. Current car has no air, one door that won't open and needs new exhaust system. If it were a local job I would agree that keeping the car makes sense.

I like the idea of waiting until he knows more about his needs. He should find out his job location about a month prior to starting so that may be worth waiting for to see how far away he will be and what part of the country. Perhaps AWD would not be needed.

He did say that during his co-op job most of the employees (including the construction workers) drove very nice trucks. Thankfully his supervisor drove an old honda civic and said the trucks were more for show rather than necessity.
Sounds like you are confirming that he must use his personal car (or truck) for his job on a regular basis. If that is the case you want him to also investigate the best way to handle those costs with keeping records and taxes - it could affect the decisions on new/used and lease/buy.
jojay
Posts: 140
Joined: Sun Apr 29, 2012 11:09 am

Re: New or used vehicle for new graduate with job?

Post by jojay »

First off, congratulations to you and your son. Graduating from college is no small feat especially in civil engineering. The fact that he already has employment is another point worth acknowledging.

Our soon to be 23 year old has a BS and will be getting her MS in June so she is in a similar condition. She will be staying local in New England and thus, she needs ( or her parents want ) an AWD vehicle.

Our plan was always to "sell" her my 2009 Highlander with 165k miles for her first car. We have discussed that versus other options. She has minimal school debt, accumulated about $11k in savings and has shown remarkable maturity and discipline while in school, working and doing well in both. She wants a new car. Me being frugal says "no" - after all I did not get my first new car until 40 plus. But - and she is very, very financially conscientious (she is my daughter after all) - she does not want a dented, dirty, driven to the dump regularly vehicle and wants to get something else. Plus, newer vehicles have lots of safety features my Highlander with a cassette player lacks.

So this week, we bought a 2018 Honda HRV. It is smaller than a CRV but still roomy and gets 31 mpg combined. All in, we paid $21,385 - by all accounts a steal. We know how to buy new cars so we know we did well.I think we hit it right walking in at the end of the month and so on.

Our children are not us. Your son has done well. Yes, he should pay off loans, have an emergency fund, start his 401, his HSA, save for a house and so on. But, he sounds like he will do that - he has the discipline. As much as this flies in the face of some of this website's philosophy, let him live a little.
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