The Driving Machine


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bmw-snowboardThe Driving Machine

The image is mine … since Josh likes BMW’s nd snowboards, I thought that this image of a BMW with matching snowboard would be appropriate 🙂

From Josh’s comments on Ryan’s post, the BMW ‘fetish’ comes as no surprise 🙂 A caviar taste requires a Greek shipping magnate’s bank balance … let’s see as this experiment unfolds how we can help Josh along the way. In the meantime, I think that Josh has a sensible strategy about buying used … read on and you’ll see

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The vehicle I currently drive is a 2001 Audi A4 1.8T, manual transmission. Ever since I began driving, I’ve always liked Audi’s but preferred BMW’s, unfortunately due to the price of newer BMW’s, I’m driving an Audi and have been  enjoying it quit a bit since I bought it in August of 2008.

This car has definitely come in handy with the snow storms this winter and since the backseat drops down, I can easily fit my snowboard in the trunk for impromptu ski trips. Not to mention spending about half as much on gas compared to my last car, a 1995 BMW 5-series V8 which I sold in July for $3700.  The proceeds from this sale plus earned money went into my current vehicle and necessary repairs.

I bought my current vehicle in Queens, NY from a New York City police officer for $2600. At the time of purchase the exhaust system was severed at the flex pipe which is right below the exhaust manifold and the clutch was slipping. The main cause for concern is obviously the clutch because the cost to replace it (not that much if you do it yourself, but without a garage and lift, it’s near impossible). I found the car on Craigslist, called the gentlemen on Friday, offered him $2600, and he told me to call him Sunday. If no one had bought it by then, he would consider the offer.  Sunday came, I called, went down to Queens and bought the car.

Once I got it home I had the exhaust fixed the next day and the clutch done two weeks later, both repairs together cost $1300, leaving the final cost of the vehicle at $3900.  One thing I would like to note about this purchase is, I enjoyed buying a used car with a bad clutch. When buying a used manual transmission, there is always some ware on the clutch but unless it is slipping, you don’t know the extent. Since it was an obvious factor in the value of the vehicle,  I was able to negotiate the cost of replacing it into the price of the car. Now that the repairs are completed and the car has 110,000 miles, the value is in the ballpark of $5000.

Selling the car and taking public transportation would not be worth the hassle where I live in rural New York, nor would it fit my lifestyle of ski trips to the Catskills and visiting friends in  New Jersey and Connecticut, so losing my wheels is not an option.

The next car I purchase will probably be a new BMW 3-series.  I like the dual turbo 335xi or the new M3 (a loaded 335xi or a base model M3 both go for around $55,000), but by the time I get tired of the car I have now, who knows what I’ll be into.

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Reader Comments

Great work on your car purchases Josh! I’ve tried to tell friends and people I know how to do this all the time. So many people will see someone in an Audi, BMW, or Mercedes and be like “Well, that must be nice, but i’m not loaded like them” or “That must have been a dumb finacial move. They probably have a car payment the size of their mortgage”.

But I tell them, nope, buy used, take your time, look for good deals, pay cash and you’ll be driving a ‘premiere’ brand, European luxury automobile and paying less for it than they have paid with their ford focus payments for 6 years and 12% interest.

And the average person couldn’t tell you the year of your Audi, or BMW, or Mercedes, or whatever. They just see the car and brand and go “ooooh, must be nice….if the man weren’t holding me down, I could drive that too”.

Good job 😉

lol, thanks Scott. Where there is a will, there is a way.

@ Josh – All I can say is that you seem ‘cursed’ to share the same fetish for shiny metal with European badges on them that Scott and I seem to share 😛

But, you did exactly what I did with my third car: I bought a 10 y.o. Porsche 911 (1972 model … I’m THAT old!). I actually made more money, when I sold that car a few years later, than I made selling my 1st investment apartment.

My biggest cost was mechanicals (a new gearbox cost me $4k … about 1/3 the cost of the whole car) and a friend and I stripped the car and repainted it from that horrible lime green to a beautiful ‘Ferrari’ red ourselves … we did the exterior in acrylic (!) and the interior (door sills, etc.) in over-the-counter spray cans!?!

I agree … this is the BEST way to get into a fancy car.

As to the new BMW: any ideas on what you are going to do, after reading my comments on Ryan’s post, yesterday?

http://7m7y.com/2009/02/07/dude-wheres-my-car-fit-in-with-my-number/

@ Adrian, Thats basically what I’m getting at. When I have the money, I enjoy a fun car so much that I’m not really going to care about the initial depreciation, although I do fully understand and am aware of it. It’s a vice I enjoy and will pay for.

@ Josh – … as long as the purchase price of the car + the current value of your other possessions doesn’t equal more than 5% of your total Net Worth … and, assuming that reaching your Number (by your Date) is your primary financial concern … right now, you’re at 20% 😉

thats true, I’m am breaking the rule.
I would obey the rule, but I don’t think I can find a reliable car for less money then this one. If I made any move to sell the audi and buy some wreck, I think in the long run it’s going to cost me more if I try to re-adjust and get into a $1000-1500 dollar car, then if I were to just stick with this one for the future.

This spring I plan to replace the timing belt, thermostate, accessory belts, and a tune up. Once completed, I wouldn’t be surprised if this car lasted me another 100,000 miles, which is about seven years of driving.
Buying a $1500 car could cost 0-1500 in maintenacne and could last anywhere from 0 miles to 50,0000 miles. I guess I’m just risk adverse in this situation.

@ Josh – Even though I was thinking of your NEXT car (i.e. the shiny, brand new BMW) rather than this one, you bring up a great point: I can have no hard and fast rule around your FIRST/CURRENT car, just as I can’t around your first house, other than saying that often you have to break the rule(s) to get INTO the market … just use The Rule when you are thinking of upgrading: if your current car can suffice, don’t upgrade until [the Rules say] you can afford it 🙂

When you do the calc’s you do need to consider the ‘whole of life’ cost (e.g. including maintenance, depreciation, etc.) … just don’t fool yourself by ‘manipulating’ the numbers in your mind to sway the result towards making the upgrade purchase …

[…] Josh is obviously the other BMW-fan; we use his post to re-introduce the 5% Rule for cars and other possessions; should Josh have broken the rule to get int his first car? You might be surprised by the answer (it’s in the comments)! […]