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Keep it or Sell it?

Hey guys - I'm gonna break this down into 2 sections. A detailed section and a brief section for those that like to read and those that don't. Please feel free to take any.

***Brief Section***

If you were in my shoes, owning a car that you're not 100% happy with and it's value is rapidly depreciating, but in lieu of all this it's almost paid off and has really low miles. Would you sell and finance for something you want or continue college car payment free with strong beliefs that when you're done, you car can't be sold because it may be worth nothing.

******Detailed Version******

I'm a very very conflicted person. It's so hard for me to make a decision on anything if there's any level of doubt. It's as if regret is one of my biggest fears haha.

I currently own a 2009 Cobalt SS Turbocharged with 27,000 miles on it and I've been pushing 300WHP since it had 5,000 miles. I bought it used with 989 miles on it. I'm currently at 350 FWHP/397 Torque and I achieved these numbers January of 2012. It's a fun little car, but there's things I dislike and these reasons are causing me to want a something else.

I live in Colorado so AWD and FWD are more practical for year round driving. Plus I'm way up here in the Mountains and N/A V8s aren't as efficient. RWD's in the snow would also make life hard. So I want to stay away from high torque RWD cars as much as possible. I typically beat Camaro SS's, 2012 Mustang GT's (especially from a roll), but I typically get worked by S/C'd V8's. I know it may be hard to believe, but it's true, high alt. and N/A cars don't work well together. If you don't believe me, lets just leave it at that. I wanna keep this as on point as possible.

Anyway, the things I hate about my car are build quality, reputation, daily drive, refinement and functionality. The daily drive is poor, rough and the I find things all over the place that screams "I didn't cost much and if you're too rough, I'll break". That aside, my car's engine has been great. I haven't had any issues with it and I feel like it's reliable enough to make it for a long time. The maintenance is super cheap and when things do go sour, it's a cheap fix that I can do myself usually with my basic tools. I typically don't beat on my car regularly so I have that in my favor. As for reputation; if you find it hard to believe I don't get a hard time for owning a Cobalt SS/TC then I don't know what to tell ya, but I do and it happens more often than you'd think. I know that shouldn't matter, but sadly it does. Perhaps I have low self confidence, however there's no need to get into that.

I'm looking for a car that I can mod to about 280-300 WHP, but I can settle with as little as 250 WHP. I no longer care about becoming the fastest guy on the road, which was the mentality I had when I got the Cobalt. Now I just want something peppy that I can mod to a 250-300 WHP tire spinning fun little car. Above all, class, style and quality.

Now that that's out the way, my Cobalt depreciates so freakin fast. I owe $4000 on it now and it should be paid off next year especially if I dump my tax return into the loan. I've asked some people and they say keep it and go without a car payment for a few years. But I feel like the rapidly depreciating value will make it worthless after a few. Where as if I sell next year I can get... say $13,000-$14,000 that I can use for a more refined car, such as a GTI, Focus ST, Mazdaspeed 3 or something along those lines.

A buddy of mine suggested and tried to convince me of the sweet life without a car payments. While I clearly see his points, I also see mine. It's a tough call for me.

So I'm reaching out to total strangers as logical as that is.

Thank you for the help..

Respectfully,

Michael

Comments

  • Mr_ShiftrightMr_Shiftright CaliforniaPosts: 45,271
    Well first off I don't think your estimate of $13K-$14K for the car next year is realistic. You have to realize that you have devalued the car by modding it--that's just a fact of life.

    Keeping in mind that you may only get $12K for the car in a year's time, then the best time to sell would logically be when the car is all paid off---if you sell now, you'll have to pay the car off anyway, even if you get more for it.

    Depreciation will occur on any car, so it's true that the longer you hold onto your cobalt the less it will be worth---but cars are not investments. They are not assets, they are liabilities. You trade the "value" for the "use" in other words. If you drive a car 30,000 miles and sell it for $9000 less than you paid, you haven't "lost" $9000, because you have the benefit of use.

    So I'd suggest that you re-frame your question as one of "use vs. market value". If you'd get better USE out of a FWD or AWD, then fine, that's a good reason to sell; but if you're thinking that you're going to somehow beat depreciation but substituting one depreciating car for another--that's simply not going to happen.

    MODERATOR --Need help with anything? Click on my name!

  • I am aware of modding consequences. I had a 1994 Integra LSVTEC that I thought was the fastest car in the world and attempted to sale at "modded" value. I got laughed at in most cases. Had to settle for way less than I wanted to. I took steps to preventing the same thing from happening this time around. I kept all my stock parts and they're sitting in my basement. I purchased a spare ECU so I run around with my tuned ECU on a daily basis and when I go get warranty work or any work I swap ECUs.

    So other than what I state on forums and to people, I don't imagine selling a stock Cobalt SS/TC is a problem. I still have my stock downpipe with stock cat, stock exhaust etc. All my parts are direct bolt on so it's an easy swap back. That said, I'm ready to accept a lower amount as well. I am fully aware that there's a chance I will have to lower my price to sell.

    I also understand cars aren't "assets", but the fact of the matter is they are viewed as assets in most cases. I'm not trying to buy a car as an investment. I'm buying a car that I want over a Cobalt SS/TC, but I'm trying to do so with the least amount of financial hit. So would it be more financially sound to sell when the car is worth more or just go without a car payment?

    In addition resale value doesn't depreciate at the same rate for all cars. I understand they do depreciate regardless, but a GTI will sell more used than a Cobalt SS/TC of the same production year with similar miles and features in 4 years from now. I of course don't know this as fact, but I'm willing to bet the statement is more probable than not. Say it's only hundreds, but I'd say more like $2,000-$4,000 difference in price.

    Take the Dodge Caliber SRT-4, it for some reason (at least here in Colorado) still sells for $18k-$20k. Why is it still retaining so much "value" (Has less liability? by your logic)

    I don't know, but what I'm asking advice on is, if you were in my situation, and you have the ability to sell your car that you enjoy for it's performance for a car that you'll enjoy for it's refinement and functionality but at the cost of performance would you sell while the car is worth more. Or save and just drive the car until it's dead?

    This is more of a question of scenario more so than logic. More emotionally based rather than fiscal. It's a would you do it if you could type of question like, would you cheat on your wife for your favorite celeb type of question.

    I hope you understand what I'm getting at
  • steverstever Viva Las CrucesPosts: 41,295
    edited September 2012
    The True Cost to Own tool will let you compare depreciation and other "holding" costs over a 5 year period for new cars. Depreciation seems to run around 10% a year for those years and then drop off. There's no tool for "emotional" value though and I think you answered your own question with your question - "you're not 100% happy with".

    Life is short, drive what you like.

    Of course, driving them forever is more financially sound, but it sounds like the driving experience is one of your higher priorities. Something else can likely slide in exchange.

    Pretty smart keeping the stock parts around. I'm one of those who walked away from a modded vehicle years ago because I didn't trust the reliability. With luck, you'll be able to sell the mods and recoup some of those costs too.

    Moderator
    Minivan fan. Feel free to message or email me - stever@edmunds.com.

  • Mr_ShiftrightMr_Shiftright CaliforniaPosts: 45,271
    edited September 2012
    Well judging from your past history with cars, if you sell the Cobalt, you'd better pick something that is also a kick in the pants, otherwise I suspect that you (like ME!) are going to get bored quickly. I sold my Subaru for a Mini Cooper S. Was the Subaru a better, more reliable car? Yes. Did I lose money selling the Subaru? Yes. Was the AWD and station wagon configuration more practical than a MINI? Yes.
    Am I sorry I sold the Subaru? No.

    Also I think your view of the market for the Cobalt and the Caliber SRT-4 is a tad optimistic. More like $16K for the Caliber. And remember, a Caliber SRT-4 even with modest options sold for $30,000 no problem, so the resale really isn't that good compared to your Cobalt.

    MODERATOR --Need help with anything? Click on my name!

  • Okay cool, I get what you guys are saying. It's pointless to try and figure out what the best choice is by adding variables taking away rules etc. I'm just making it way to complicated.

    Just ge what I like, who cares what it does and what it doesn't, just as long as I'm happy with it.

    I knew this all along, I think, I just didn't want to think for myself so to speak.

    LOL, and yes I get bored very fast, so I'm gonna need that kick in the pants haha.

    Here's a link to the Calibers I referenced, they are 18-19k for less than 35k miles and the other is less money, but it has 50k miles

    http://www.cars.com/for-sale/searchresults.action?prMx=20000&sf1Dir=DESC&prMn=0&- mkId=20012&mdId=20794&rd=75&crSrtFlds=stkTypId-feedSegId-mkId-mdId-pseudoPrice-t- rId&PMmt=1-1-1&stkTypId=28881&sf2Dir=ASC&sf1Nm=price&sf2Nm=miles&isDealerGroupin- g=false&trId=25139&rpp=50&feedSegId=28705&searchSource=GEO_SEARCH&pgId=2102&zc=8- 0033

    The link is rather long, but if it doesn't work then what ever, it's not that important.
  • Mr_ShiftrightMr_Shiftright CaliforniaPosts: 45,271
    Well "asking prices" are merely the car dealer exercising his First Amendment Rights. He can ask whatever he wants, but I'm just not seeing how an SRT-4, of all things, would command such a high book price. I feel certain you could buy either of those $18K cars for $16K. The SRT-4 certainly has no more refinement than your Cobalt.

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