Money 303: Big Decisions – Cars

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Depending on where you are and what your lifestyle is, a car is not always a necessity

  • Public transportation or a bicycle might be a better option
  • Most of the time, you only need one car, even with a family
  • If you’re thinking of getting another car, be sure it’s for the right reasons
    • If the car needs major repairs and will soon need more repairs that are cost-ineffective to a newer car
    • If you need more room for a growing family
    • If it is no longer trustworthy to serve its purpose of getting from one place to another
    • Generally a $1000 repair every year is worth more than paying for another car
      • Ask if the cost of the repair is worth the amount you’d be willing to pay to buy that car if it was fixed
    • The car may be repurposed as one of your children’s first cars or as a work car or road trip car

Buy a used make and model

  • Get one that is at least 5-15 years old, but at least 2 if you are mechanically retarded
  • Purchase a brand that has a reputation for reliability
    • Never buy the first-year of a model, since they are more likely to have problems
  • Certified pre-owned cars means that the dealership “certified” it, which may mean absolutely nothing
  • Don’t lease, since leasing cars is mathematically the most expensive way to own a car
  • Go for a smaller car, since larger ones burn more gas and are more expensive when they break down
  • Walk into it with some awareness
    • Learn what its value should be approximately by looking at the Kelley Blue Book
    • Used cars will have 3 potential problems
      • mechanical problems
      • poorly maintained
      • have been stolen or involved in major accidents
    • Ask for a Carfax or other vehicle inspection report
    • Ask for any maintenance records like oil changes or repairs
    • Write down any questions that you have as you’re examining it
      • Even if they’re dumb questions, you can disregard them later
    • Take someone experienced with autos with you to help you inspect it
    • Have the right bargaining philosophy to not be taken advantage of
      • Be ready to walk away, and never look desperate
      • Have cash with you to lure the buyer’s desire to sell to you
    • Educate yourself on the quality of the car’s manufacturer
      • High-end brands like BMW, Renault and Ferrari are very good, but will cost a lot of money to repair
      • Large brands Toyota, Honda, Ford and Subaru are highly reputable, but are affordable to repair
      • Mid-level companies like General Motors and Nissan create reliable cars, but they are more likely to break down
      • Volkswagen is a great car, but is built for you to make your own repairs
      • Value-priced cars like Kia, Hyundai and Fiat are affordable as new cars, but are much more expensive to maintain and break down frequently

Inspect it before you buy it

  1. Look around the outside and body of the car in broad daylight
    • Check for oil leaks underneath it or white dust (body filler)
    • Look at the tires for cupping or gouges, which points to a bigger problem
    • Inspect for body damage
      • Open and close all doors and check if the door seams are the same
        • Pull back the rubber around the doors and windows to compare if the paint is the same
      • Slam the hood and see if it’s aligned correctly all the way around (compare right to left side)
      • Pop the trunk to see any rear-end damage
        • Check the factory seams underneath the spare tire in the trunk
      • Observe the paint reflection to spot any dings or fixes
  2. Crank up the bottom of the car
    •  Check the CV joints
    • Check if the engine or transmission has any leaks near it
  3. Scan it with an OBD-II reader
    • The reader can be as cheap as $40
    • The port is usually under the steering wheel somewhere
    • Read the codes, if there are any
  4. Test drive it
    1. Cold start it (start it from being under 90°F without the keys in the ignition for at least 8 hours)
    2. Let it idle for 3-5 minutes
      • Test the signal lights and all headlights
      • Test the heater/defroster, rear defroster and air conditioner
      • Shift the gears several times
      • Test the windshield wipers and radio
      • Check the exhaust for drips or black smoke
      • If the car is running hot after idling, turn it off and walk away unless they are literally giving it to you
    3. Drive through the city to the highway from 25 to 40 mph
      • Listen for buzzing noises, humming noises, clicking noises
      • Set the inside fan to hot and defrost, then set it to high and try to smell any leaking fluids
      • Hit the brakes quickly without touching the steering wheel and see if the car swerves left or right
      • Test the power steering by turning the wheels while stopped
      • Drive it through an alleyway or at least near a large flat wall to hear sounds it makes while running
      • Swerve back and forth in a parking lot to test the suspension
    4. Accelerate at 1/2 to 3/4 throttle onto the highway, then stay on it for at least 5 miles at 55-60 mph
      • Check to see if the steering wheel shakes or the whole car seems to lean one direction
    5. Drive through the city back to the location, continuing to test the different systems
      • If it overheats during the drive, don’t buy it
  5. Read the codes again with the OBD-II reader, just in case any came up because the seller reset the codes
  6. Bring a car to a mechanic to do a final check if you want to buy it (the $100 check may save you thousands of dollars)
  7. When negotiating, it’s best to do it in the rain, since people don’t want to stick around for it

If you know when parts are most likely to break down, you can diagnose problems more easily

  • Lifespans of car parts might vary between models and how large the vehicle is
    • Starting System
      • Alternator – 80,000 to 100,000 miles
      • Battery & Battery Cables – 3 to 5 years
      • Starter – 80,000 to 100,000 miles
    • Engine
      • Air Filter – 10,000 to 15,000 miles
      • Electronic Engine Control Module – 80,000 to 100,000 miles
      • Engine Belts – 40,000 to 60,000 miles
      • Fuel Injectors – 100,000 miles
      • Mufflers & Exhaust Pipes – 50,000 to 80,000 miles
      • Oil Pump – the life of the car
      • PCV Valve – 30,000 to 40,000 miles
      • Spark Plug – 100,000 miles
      • Thermostat – 40,000 to 60,000 miles
      • Timing Belts – 60,000 to 100,000 miles
      • Valve Lifters – the life of the car
    • Fuel System
      • Fuel Filter – 30,000 to 40,000 miles
      • Fuel Pump – 70,000 to 90,000 miles
    • Cooling System
      • Radiator – 100,000 miles
      • Radiator Hoses – 40,000 to 60,000 miles
      • Water Pump – 70,000 to 90,000 miles
    • Transmission
      • Automatic Transmission – the life of the car
      • Clutch (Manual Transmission Only) – 40,000 to 60,000 miles
      • Front Axle Shaft – 70,000 to 90,000 miles
    • Suspension & Structure
      • Leaf Spring (Large Vehicles Only) – 5.5 years
      • Lower Control Arms – 70,000 to 90,000 miles
      • Shocks (If No Struts) – 15,000 to 35,000 miles
      • Springs (If No Struts) – 70,000 to 90,000 miles
      • Struts (If No Shocks) – 40,000 to 60,000 miles
      • Tie Rods – 70,000 to 90,000 miles
      • Universal Joints – 70,000 to 90,000 miles
    • Brakes & Power Steering
      • Disc Brake Calipers – 70,000 to 90,000 miles
      • Disc Brake Pads – 30,000 to 40,000 miles
      • Drum Brake Shoes – 30,000 to 40,000 miles
      • Power Steering Pump – 80,000 to 100,000 miles
    • Exhaust System
      • Catalytic Converter – 100,000 miles
    • Personal Convenience
      • Air Conditioning Compressor – 80,000 to 100,000 miles
      • Heater Cores – 70,000 to 90,000 miles
      • Horn – 100,000 miles (assuming you’re not an idiot)
      • Power Window Motors – 60,000 to 90,000 miles
      • Windshield Washer Fluid Pump – 70,000 to 90,000 miles
      • Windshield Wiper Motors – 70,000 to 90,000 miles
  • Avoiding keeping the car parked where the elements can destroy it:
    • Extreme heat or extreme cold
    • In a high-salt environment like a salted road or at a dock
    • In consistently wet conditions
  • To increase your parts’ lifespan, drive where a full cup of water on the dashboard won’t spill anything
    • Accelerate slowly by barely tapping on the accelerator to save gas and engine wear
    • Keep the windows down with the air conditioner off under 40 MPH
      • It’s less windy to roll down one front window and the opposite back window
      • Over 40 MPH it’s more economical to drive with the air conditioner on
    • Every 5 MPH over 60 MPH will cost about 3-4% more for gas per mile and will wear out the engine
    • Brake slowly by taking 50-100 more feet to stop than you’d expect to need
    • Turn the car’s steering wheel very slowly to save wear on axles and the power steering

Save money during your routine

  • Make your errands back-to-back to keep the car from getting cold in between times
  • Refuel gas mindfully
    • Try to not let the fuel light come on too often
      • Debris and sediment in the fuel tank can get picked up by the fuel pump and damage it
      • Running out of gas can ruin the catalytic converter
    • Get gas at stations that have at least one other station around to ensure it’s a competitive price
      • Look at a free service like GasBuddy to find the best gas prices in the area
    • Unless the manufacturer specifies otherwise, getting premium gas makes no difference in fuel economy or engine performance
      • If you want fuel additive, it’s cheaper to buy it at an auto parts store
    • Refill gas by half-pressing the trigger to avoid air counted through the meter
  • Keep the tires inflated within 5 PSI of the recommended pressure levels
    • This will save a lot of wear on tires and increase the safety of braking
  • If you need air for tire inflation or water for the radiator, gas stations offer them free
    • The coin deposit is just for display, since they have to give it free by law
    • At Shell gas stations, pressing the button on the side of the air pump 3 times will start it without coins
  • Wash your car yourself to save a lot of money
    • In automatic car washes, the Basic is just as good as the deluxe, and they simply change the color of the soap
    • If you do take it in, check back if it rains within 48 hours of getting one, since most car washes have a rain check policy
  • Many medium-sized dents on the car body can actually be removed with a plunger

Make your own repairs as much as you can

  • Automotive parts can be severely reduced from neglect, so keep up on preventative maintenance
    • Keep the battery terminals clean
    • Change the oil about every 7,000 to 10,000 miles
    • Watch for wear on the air filter and spark plugs, since they are extremely cheap and easy to repair
    • Monitor the fluids and keep them filled monthly
      • Brake fluid
      • Coolant
        • Should be 100% antifreeze, diluted antifreeze is a waste of money
        • Keep water in the trunk in case there’s a leak
      • Motor oil and oil filter
        • Older vehicles will burn off or leak oil much faster
        • Keep unopened oil containers in the trunk in case it needs to be topped off
      • Power steering fluid
      • Transmission fluid (about every 100,000 miles)
        • Back-flush it when changing it
    • Keep track of when your parts were replaced by date and/or mileage
  • When buying auto parts, try to get ones that have a lifetime warranty
    • Keep track of the receipts by putting them in a safe place
  • Brakes are easy to change once you learn how to do it
    • Make sure you keep the car secured with chocks or a sizeable rock
    • Use a spackle gun as a brake caliper holder
  • Only replace the tires when you need to
    • Unless you live in the mountains, tires can go nearly bald and you’ll be fine
    • Use a penny to test tire treads, it needs replacement when you can see Lincoln’s head with the penny in the groove
  • Fix any problems right away, since small problems will quickly become major repairs
  • Buy a few things to be prepared for when you need them
    • A jack and jack stands
    • Latex gloves
    • Air tools and an air compressor, which can be a few hundred bucks
    • Scan computer(s), which can be $30-200
      • Look up how to read the data online if you don’t understand it
      • If you can’t afford one, you can often borrow one at an auto parts store
    • Instead of a second person for the pedals, use a steering wheel holder and pedal depressor
    • Whatever other specialized tools you need for the job ($200 tool < $500 repair)
    • A shop manual for the vehicle that shows how to replace every single part of the car
  • Diagnose your car if it can still be driven when something fails
    1. Observe the circumstances and context of the failure and write down notes
      • The weather conditions
      • The angle the vehicle is travelling at
      • The amount of load the vehicle is bearing
      • The gear it’s in and what happens when shifting gears
    2. Check any warning lights and look up any codes in the scan computer
    3. Search the internet for the codes to find 3 specific things
      • Direct information on the code, similar to what a repair manual would tell you
      • A step-by-step video where someone walks through the problem and how to fix it
      • A message board or blog post about the issue
        • Look for consistent information across everything to find out the most accurate answer
    4. Either fix the problem yourself or give it to a technician with a written diagnosis of your problem
      • This helps them skip the diagnosis stage of their work, saving you money
      • It prevents them from taking advantage of you, since you’ve proven your mechanical capability

If you do have to take it in, pay attention to where you go

  • The location
    • Visit on a Monday and not a Friday, since the mechanic will want to finish the work by the weekend
    • Check for certification in the shop and for a state license if you’re in the USA
    • Look for a clean garage, since a cluttered floor filled with dirty rags may be a red flag
    • Pick a small business owner over a large chain store, hourly workers are never as considerate or ethical as someone who gets paid in referrals and repeat service
  • What they tell you
    • Be wary of scare tactics, especially when they claim they wouldn’t drive your car another foot
    • If they tell you they don’t need fancy equipment like a basic engine analyzer, go elsewhere
  • Be careful how you act
    • When getting a second opinion, don’t give the mechanic what the first diagnosis was
    • Never sign a blank work authorization form, always have a specific estimate for each job before signing
    • Many times you will get charged doubled labor for multiple tasks, ask about labor time beforehand
    • Ask for your old parts back
    • Request factory equipment to ensure you have legitimate parts
  • Common markups
    • You don’t need to have your fuel injector cleaned
    • Coolant flushes are usually a gimmick, and you can do it yourself
    • Power steering flushes are also usually a gimmick
    • Transmission flushes aren’t recommended by manufacturers and cars almost never need them
    • Avoid lifetime mufflers, you’ll still have to pay for pipe repairs
    • Catalytic converters or emissions systems are often legally required to be given by dealers
    • It is normal to have metal particles in a transmission pan
    • You can change your own air filter, verify the air filter full of dirt actually came from your vehicle
  • Common corner-cutting
    • If the tires are a strangely good deal you may be getting old treads, ask about the build date
    • Be careful about brake jobs, since many mechanics will mark up cheap parts
      • Alternately, a mechanic will not make money on an advertised $100 brake job
    • There are no government standards for used tires, so personally inspect them

Know when to let it go

  • A used car will incrementally increase in its repair costs every year
  • Eventually it becomes a better idea to get another car, which is easier each time you buy one
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