When to Purchase a New Vehicle
I recently have been having this discussion quite a bit more with my clients. Right now, used and new car prices are through the roof. I believe this is going to continue for the next year to a year and a half. I do not think this will clear up in 6 months.
So if you're in the boat of thinking about purchasing a new or used vehicle, I would recommend having your current vehicle evaluated first. Find a place that will look at the urgent fixes right now and the items coming up. Tires can be expensive, so it would be good to know if you're going to need them within the next nine months to one year. Brakes can be costly; it would be nice to see if you're getting close already to keep an ear out and have them addressed before it gets expensive with rotor replacement.
Once you know what to expect with your current vehicle, crunch some numbers on how much the replacement car payment will run. If you're purchasing a used car, you are more likely to need to do some work before driving it daily and for long-term reliability. The average amount we, at Professional Auto Care, see people spending on their new, used car is around $1,500.00. Then, of course, we see the vehicles we check out where we advise the client against purchasing. (You do not want to purchase someone else's problem.)
Don't forget to look into how much insurance will increase with that new vehicle or if you have young drivers on your insurance policy or will soon have young drivers. The newer car is going to be more expensive.
The cost of maintenance for the new vehicle is worth researching as well. Many manufacturers are moving to a system where a service indicator will tell you when to schedule service. I do not have much faith in that particular system and would prefer to follow a set schedule. However, many systems now do more than have a mileage timer. Some can track the vehicle operating conditions such as regular flowing highway, high temperature/high load situations, city driving/short trips, cold starts, and extreme short trips. Others even combine the monitoring of the operating conditions with the engine temperature. It is important to note they measure the oil condition with a software-based algorithm. Most do not directly measure the shape of the engine's oil or detect the contaminates in it. They also do not have a reliable way of determining the oil quality used at the oil change.
Now, if you want a new car, then forget everything above, and if you can financially afford it and you're already going to meet your goals for your retirement plan, then go for it.