"Bhoot Nath" <d...@y...com> wrote in message
news:bc849604-835f-4710-9df3-0d80736ebc52@z72g2000hs
b.googlegroups.com...
>
>..............snip>


> Now the civic paint is peeling, and a cheap repainting at Maaco is
> estimated at $800. The car will hit 180K miles in a few weeks, and is
> due for the major maintenance + the timing belt + water pump stuff
> that is done at every 90K miles. All of this is estimated to be about
> $1500. I estimate tires and brakes also, probably within a year, for
> another $700 or more. So, within a year, it will add up to
> $800+1500+700 = about $3000.
>
> The car is probbaly worth 3500 due to mileage + usual wear and tear
> after 14 years (& some dings), but no mechanical problem. We would
> like to keep this car (we are not itching for a new car smell), but
> does it make sense to put $3000 into a $3500 car? How critical is to
> replace timing belt and water pump stuff every 90K?
>


I find your numbers are probably too optimistic.

Using Edmunds
http://www.edmunds.com/tmv/used/honda/index.html

I did a little test run. Used car pricing varies depending on many factors,
including age, condition and location. I don't know your location, so I
used my zip code [Brooklyn, NY]. I don't know what model you own, color,
etc. So, I picked the highest line 4 door from the 96 model year. I used
175K as the mileage. Given you description of the body's condition, I chose
"average" -- that is a generous description, given your peeling paint and
dings, a dealer or other buyer would see your car's condition as
significantly below average.

I chose "gray" as the color, with A/C, 4 speed automatic and an AM/FM
cassette. The values suggested by Edmunds are significantly below what you
presently think the value of the car is:

-- trade in value -- $639
-- private party sale -- $1094
-- dealer retail -- $1887

Remember, my numbers are all guesswork -- imaginary car, imaginary
location. Keep in mind that you see the car as valuable because of
emotional factors [it always started, never gives trouble, it got us home in
that snowstorm, etc.] -- a competent buyer will consider it sans emotion.

I'd suggest that you do some further research -- use Edmunds, do a google
for Kelley Blue Book, and for NADA. You will get differing numbers
[markets are art, not science]. But I don't think you will get numbers as
high as what you currently project -- any 12+ year old car with peeling
paint and 175K mileage is likely to be difficult for a dealer to resell [and
make a requisite profit from] -- and not all that easy to sell to a private
party for 3.5K cash.

If my surmises are in the ballpark, what I'd consider doing is the
following:

I'd take that $3000 expense money you are projecting and put it towards a
newer vehicle.

Go to Consumer Reports -- read their car buying issue [in libraries, or for
a small fee, you can buy a year's full access to their website -- I
subscribe to both their paper edition and their website, it's quite
worthwhile]. I think you will find their evaluative philosophy and
criteria in line with yours. That will help you get an idea of what is out
there, what is reliable in terms of used cars and new cars, what fills your
needs, what to avoid, what is worth paying for, what realistic cost
projections are, etc.....

I'd consider a new car, or a low-mileage used car no more than 3-4 years
old. If buying a used car, unless I could buy such a car from an individual
I knew, and it was a car whose history I trusted --- I'd purchase it from a
reliable new car dealer. Yes, a new car dealer. The best combination of
used car + new car dealer would be a new car dealer selling the same brand
of used car, or a used car from/manufactured by that dealer's corporate
parent manufacturer [e.g., a Mercury from a Ford dealer, a Honda from an
Acura dealer, etc.].

Yes, buying such a used car would cost more than from a private party or
third party dealer. But......... here's why I'd spend that extra money:
As far as I know, in the real world, a dealer wants to market used cars that
will not give him headaches, or sully his reputation. If he takes back a
car from a lease, or gets it in some other transaction, he will tend to keep
the very best for himself, and let the doubtful and clunker vehicles go to
auction. If he needs used cars for inventory, he shops for inventory with
other dealers he trusts and/or thru his corporate supply chain. In all
cases, he is not looking of for headache vehicles. He does not want a shiny
vehicle that lived thru Katrina, or was hit and reassembled by artisans,
etc. So, in the case of a *reputable* dealer, what is sitting on his used
car lot is likely to be prescreened in terms of quality.

[the above theory goes out the window if you shop with a lousy dealer]......

As for the old car, you can either sell it, or, if you do not want the
aggravation, I like the suggestion that you donate it.

HTH

albert





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--------------------------------------
Misc.invest.financial-plan is a moderated newsgroup where Moderators strive
to keep the conversations on-topic for financial planning. Other posting
guidelines include a request for brevity and another for trimming posts to
which we respond. For all of the other tips and suggestions, see "FROM THE
MODERATORS: Posting to misc.invest.financial-plan", a weekly post now on the
Newsgroup.