I am seriously considering the purchase of a new car. Why? Because buying now may be paradoxically safer than waiting until I have more money later. If inflation takes off then money I am currently saving towards a new car right now would be partially wiped out. On the other hand if I can get a fixed loan from my credit union or whatever other financing group I would be protected. Provided I also could save a near equal amount as a hedge against the much more frightening prospect of deflation.
I could also, slightly, reduce the amount I spend every month on gasoline if I purchased a more efficient car. I currently get about 28 miles per gallon and given my moderate driving habits I can expect to do slightly better than the EPA rating for a car. If I got one of the new Priuses I could halve my gas expense at the cost of a higher car payment than if I got a less expensive vehicle (as I would want to get it a Prius would cost about $23,348). Also, I have heard there is a waiting list.
On the other hand I could get the nearly as efficient new Honda Insight for just $20,769. Given Honda's ability and reputation I expect that it would be just about as well made as the Toyota. The only reason to go with the Prius is that it is a third generation of an existing car where they've worked out the bugs rather than essentially a completely redesigned model. Plus I've heard good things so far about the things they're doing to make the Prius more reliable, like eliminating belts.
Possibly more practical would be getting a Honda Fit ($15,706) or a Toyota Yaris ($15,288). Of the two I would probably lean towards the Honda going for a bargain price car. Really it is the much more likely option, but it would probably only give me a marginal improvement over my current gas mileage.
THIS is important!!!
5 years ago