What Is The Real Cost-To-Own?

“The look”, “The shine”, “The smell” that is what we notice when we go to buy a new car. These glossy four wheeled beauties can get us into all sorts of financial difficulties. We all look at the sticker price and try to make the best deal, but have you really thought about what this car is going to cost you beyond the monthly payment?

To figure the true cost of owning an automobile is to include things like gas, maintenance, insurance, taxes, registration cost and depreciation. Using only the base model cash price and leaving out depreciation on all vehicles the out of pocket expenses for the next 5 years can be down right scary.

• The 2010 Nissan Versa cash price is $11,216.00
  cost to own is $19,285.00
• The 2010 Honda Fit cash price is $16,596.00
  cost to own is $20,151.00
• The 2010 Chevy Malibu cash price is $19,530.00
  cost to own is $23,652.00
• The 2010 Ford Fusion cash price is $18,956.00
  cost own is $23,192.00
• The 2010 Chevy Camaro cash price is $25,706.00
  cost to own is $28,184.00
• The 2010 Ford Mustang cash price is $21,698.00
  cost to own is $26,889.00
• The 2010 Acura TL cash price is $34,544.00
  cost to own is $32,260.00
  
• The 2010 Infiniti G37 cash price is $33,700.00
  cost to own is $29,981.00

As you can see the cost to own a new car is very high. The average here to own a new car for 5 years is $25,449.00 that works out to an additional $424.15 a month. Now if you finance this car you can add in the interest on the loan to this figure. All new cars and or trucks will lose about 50% of their value over the course of 5 years to depreciation so when you calculate the cost of the depreciation into the cost it increases the monthly number to $560.79.

Now armed with some facts about new cars is it really an economically sound decision to replace your old car just because it needs a couple of thousand dollars in repairs to bring it back to good health.

Should I Buy A Diesel Pickup Truck?

We get a lot of questions about the wisdom of purchasing a diesel engine pickup. The answer is pretty simple, if you really have a need for a diesel by all means get one. The other side of the answer is that if you don't have a specific need for the power and durability of the diesel engine you may be very sorry if you buy one.

So what is a real need? If you pull trailers with a heavy load such as hay, horses, a very big boat or a race car you might consider a diesel. If your truck runs all day every day or you put a lot of miles on it such as for a hot shot delivery service you might consider a diesel. If you are a recreational RV'er you should consider a diesel if your trailer is over 6000 pounds.

For all of the benefits of a powerful diesel engine in your truck there are some very substantial drawbacks. When it comes time for service it can get very expensive. The regular oil change goes from around $30 on the average car to over $100 for the diesel pickup. All of the other maintenance items such as air filters, transmission services, coolant services, brakes and tires are proportionately higher. Then there is the cost of breakdowns. When a diesel engine has a problem it is usually shockingly costly. A water pump can run over $1000 to repair, a starter $600, an alternator $500 and a transmission over $4000. There are also the common failures we see on some models with the EGR cooler; that can cost $3000 and is fairly common. Fuel injectors are $400 each and a fuel pump, depending on the model, can be $2500 to $3000. If the engine itself fails it runs well over $10,000 to replace it.

One of the biggest problems with the newer diesel engines is water contamination in the fuel. A little water in the diesel fuel; an amount so slight that the engine still runs perfectly normally, will damage the internal components of the fuel system and cause catastrophic failure. These often cost ten to fifteen thousand dollars to repair and are not covered by the new car warranty or any extended warranty. Many owners are just abandoning their truck when this happens, leaving it at the shop and calling the finance company.

Should you decide to purchase a diesel truck the most important thing you can do is get on a regular maintenance program and stick to it. Regular service of ALL the fluids, draining the water separator and keeping the fuel system clean will help to prevent unnecessary and costly problems.

There is one reason to buy a diesel that we haven't covered, ego! Sometimes we just can't resist. If that is the case don't let you wife read this article.