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Buying a car in retirement

By Jennie L. Phipps ·
Thursday, February 24, 2011
Posted: 3 pm ET

My husband and I rented a Buick Lucerne while we were vacationing last week and he really liked it. So it didn't surprise me much when marketing research firm J.D. Power and Associates sent me a report this morning that said Buicks, and the Lucerne in particular, are among the top-10 most popular cars among people older than 65.

We've been talking about whether we should replace his current vehicle -- a Bonneville -- before he retires, or whether we ought to keep driving it until its wheels fall off. We own it free and clear and it's an orphaned model -- they don't make Pontiacs anymore -- so it doesn't have much resale value. Taking on a car loan at this stage doesn't seem smart, so we'll probably pay cash, which would be a pricey purchase.

I don't drive much, but when I do drive, my transportation is a 10-year-old pickup truck that we also use to pull our fishing boat and the trailer we take to the race track. I don't see much point in replacing the truck anytime soon -- maybe never. It only has 65,000 miles on it.

Deciding what to do next with our fleet has been one of our most contentious retirement planning discussions. Left to his own devices, my husband would buy two new vehicles -- the aforementioned Buick Lucerne for driving around town and a new four-door Ford F-150 for the fun stuff.

I look at the $80,000 or even $90,000 that he proposes spending as putting money down a rat hole. New cars lose 20 percent of their value when you drive them off the lot. Plus, people living in retirement don't commute, so why do we need brand new cars? A car that's a couple of years old would be much cheaper and -- if we buy smartly -- just as good. My current truck will run forever and we only need to keep liability auto insurance on it

My husband argues that his car is 6 years old and already has had some weird maintenance issues, and we don't want to be stranded on a long trip. Besides, he loves cars and he wants a new one.

In the end, we'll probably compromise. He'll buy the Lucerne, and I'll keep my old Ford. I'll remind him frequently that his car cost too much, and he'll complain endlessly every time he sees another rust spot on the truck.

It's the price you pay for being married.

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April 20, 2011 at 7:28 am

When an older car starts asking for money, time to get rid of it!

April 19, 2011 at 9:30 pm

I have an 8 year old Jag S type-I am approaching retirement and am facing the same problem -However, I have come to the conclusion that as I have always looked after my beast the increased maintenance costs are still a lot cheaper than renewing. The depreciation is a real killer. I also have to say all my pals still like my ol Jag as it does still give me a certain street dred ( well in my little world it does)!
jim from the UK

April 18, 2011 at 8:22 pm

I reside in Australia & have a similar view if the vehicle runs okay why get rid of it. Maintain it & it will save you cash. I also catch a bus which aves on running cost. G

Mr. Frugal
April 17, 2011 at 5:30 am

Proud owner of a 1993 and 1994 Ford F-150, bought two years ago on Craigslist, for total cost of $990 for BOTH! All the parts for my repairs have been $500 total over two years. I do ALL my maintenance! They will last about another 20 to 50 years! Hey, both are Computer Controlled Fuel Injected, and, the fuel economy remains the SAME for the newest models!

Actually, all I would be getting for my $60,000+ cost to replace them would be new paint! I can paint mine for about $500 each.

Always buy USED, pay CASH, so the huge depreciation is on somebody else!

March 24, 2011 at 6:35 pm

I'm also retired and as I tell my friends, I'm driving these cars until they blow up. Well hopefully it'll be a small explosion, but seriously if you want to take a long trip, rent a new car. Use all that saved money for other things. Take a nice vacation or day trips. etc. What is the American obsession with owning a new car. Mrs. Phipps, I agree with your logic.

in my grave
March 01, 2011 at 3:28 pm

u can,t take it with u enjoy what ever toys u can honestley afford if ure saving it for ure children it is time to cut the purse strings they will probley just go blow it they didn,t work for it U DID enjoy retirement by the way i,m 47 and this is what i told my mother & father wow siblings are pissed

February 25, 2011 at 2:01 pm

I presently am also retired and like you drive a vehicle which is approximately 6-8 year old. My wife also drives a vehicle much in the same age group. Now when my wife drives the vehicles run problems...when I drive, I hear problems and can pinpoint future problems - this accounts for my abilities to see into the future - also it accounts for vanity. If the vehicles are running - drive them - save on taxes-save the worry about a new ding-life should be easier at this point. Now what I don't understand is the racetrack thing...but...we all have our weakness. You might have the hubby figure how much those new vehicles will cost total...taxes,,license,,insurance, and depreciation and then ask the question if they will be worth the amount of money when retirement is getting more and more expensive..good luck

john spellmann
February 24, 2011 at 11:50 pm

I think your final sentences show a lot of wisdom about what you will probably do. If this is any help, I think that if you really love to drive a car, then get the one you love, especially if you are retiring and may be getting to buying the last car. If you don't care how you get from point A to point B, then an older car you have is best to keep. You know it's history and you can keep fixing it for a lot less than the cost of a new car or a used car that may have major problems.

February 24, 2011 at 11:06 pm

Run the car till the doors fall off. Then pick them up and reattach them again. If the engine is well maintained, that car will LAST!!!

Sara Bee
February 24, 2011 at 3:59 pm

Wow is this problem current. I retired 2 years ago. I drive a 17 yr old 'orphan' car.

My retirement account had barely recovered from the .com bust when I moved it into secure instruments just before the latest fiasco. I retired with about the same amount of money I had saved in 1999.

Planning for major expenses is tough. Not only cars but things like roofs, cooling/heating systems, and major appliances will need replacing some time in your retirement. These things can blow a big hole in your nest egg and reduce the income you had expected from it.

Mrs Phipps is right to resist spending the money. Spending it before or after retirement doesn't make any difference. What you have now is pretty much what you have the rest of your life. This concentrated my mind for sure, and if she can stall Mr Phipps until this fact dawns on him, maybe they'll be OK.

My own plan is to drive my car until it gasps its last breath, then buy a used car. Ten years old is fine with me. After all used roofs and HVAC systems are probably not available.