Finance Travels

After reading an article (sorry, couldn’t find the link) that stated the cost savings one can realize by keeping a car for several years, I decided to see calculate approxiametly how long it would take me to reach that with our 2001 Mercury Sable (purchased by us in 2005).

Since I have mileage records dating back to July 2005 from oil changes, etc…, I simply plugged those into Excel and created a trend line. Then I extended the trend line out until I hit 200,000 miles, which will probably happen in the summer of 2011.

Originally, I had planned to replace this car either in late 2007 or early 2008, but the more I think about it, the more I want to try for 200,000 miles. The vehicle is in pretty good condition (except for 1 cosmetic dent) and I take it in regularly for maintenance. Since this vehicle is primarily a commuter car, as long as it gets me to and from work, I’ll be happy. Our family has already outgrown it, but the thought of owning 2 minvans gives me the heebie-jeebies. Having 4 years to be able to save for a new vehicle (and therefore less debt) is very enticing, plus I’m hoping that by 2011, we will start seeing some improved fuel efficient cars beyond the 20-30 mile standards we have today. Another plus for keeping it this long is the low insurance rates I pay for this vehicle.

I’ve definitely decided to keep it through 2008.

August had some pretty impressive numbers. Our brokerage accounts benefited from some positive movement in the stock market, as well as moving a good chunk of cash out of our savings and into college savings for the kids (for the purpose of this site, I consider college savings in the brokerage category). Even though we spent a good $1,000 on unexpected expenses including a new treadmill, exercise bike, and chest freezer, we still gained over $5,000 for the month.

The only alarming part of this month’s report is the growth of credit card debt. This pattern will continue until May of 2008 as I take advantage of a 1-year 0% financing deal from one of our credit cards. As statements for this card come due, I’ll be paying the minimum balance and putting the rest into a high-yield savings account where it can sit and earn interest until I pay the balance off in May.

I continue moving money out of Prosper.com as it becomes available.   Two more loans have been marked as “One Month Late”, reinforcing the idea that getting out of peer-to-peer lending on prosper was a good idea.
September should be an interesting month, as we will start to pay for three kids in daycare.