Decisions decisions

Decisions decisions

People make countless decisions throughout the course of their days and lives. Most are made without a lot of thought, as the differences in consequences of wearing this shirt as opposed to that shirt are minimal in the grand scheme of things. There are, however, choices that come up, now and again, that seem to be more substantial: Do I ask for a raise? How should I spend my yearly vacation time? Should I spend more time exercising or working on my yard? Some of these choices can really influence how other areas of life turn out.

Recently our 2002 Grand Am broke down and the cost of replacing the engine is more that what the vehicle is worth - $5300 for a new engine vs. $3000-4000 for a used one (source Consumer Report online). I know a replacement engine would extend the life of the vehicle but the bones of the vehicle are essentially 10 years old. That used engine would still likely be 2 grand plus (again only slightly less than the cost of a used one).

I know my problems are not unique. In fact, I believe these are the types of issues that pop up in people’s lives all the time. The kinds of issues that emerge that are not the end of the world but still take up a lot of time and energy in a person’s life. I think that between cars breaking down, faucets leaking, layoffs and company shut downs, investments going sour, and major construction happening on the road you take to go to work that we all contend with an unfortunate number of ‘B’ and ‘C’ grade problems almost all the time. I’m actually somewhat surprised that we all stay as sane as we do.

I’ve dealt with most of the aforementioned problems (and others) or have had someone close in my life deal with the ones I haven’t. There is seemingly an infinite number of ways to approach or deal with any of these. There are self-help books, advisors and consultants, tradespeople, counselors, friends, family members, and the good old “I’ll figure it out on my own approach” (along with countless others). Which one(s) do you use? I know for me it depends on what is going on.

During our recent car troubles I have opted to take in a lot of different thoughts and opinions regarding what we could or should do. I am lucky that I know so many different people, with varying backgrounds, all with unique experiences. Where it gets interesting is how there really is no unanimous or prevailing opinions. Some people are drawn to the 0% financing (or rates close to zero). Others point to the immediate devaluation of a new car the second it is driven off the lot. Some focus on warrantees and others on finding “gems” for a fraction of the cost of something new(er). I am also well aware that, whether new or used, some makes and models are better than others, both universally and when you look at specifics such as reliability, gas mileage, etc. Having so much information to draw upon and consider has made a complicated decision with many implications that much more challenging. *I am thankful for the people who have took the time to share their thoughts and opinions - I had to get that out there because it’s the truth. Your input has been taken into consideration. If our decision does not follow your beliefs I hope you will not take it personally.*

At this point I am really seeing that no matter which direction we go in that there are pros and cons to each decision we could potentially make. We could spend a couple of grand for a used engine and hope for the best. The costs would be the lowest (plus) but we could find ourselves continuing to dump thousands of dollars into a dying cause. For the last few years we have been putting in the kind of money into repairs that could have easily covered the cost of a car payment, even though we own it. The troubling thing with this is that the repairs are impossible to see coming and they usually happen at the most inopportune times.

We could opt to move to the next price point and look for a used Rio or Corolla for $5000-7000. We could get several good years out of it and maybe more if we get a make that has the constitution to last for 250,000 to 300,000 kilometers. But we could also inherit “drag-racing David’s” car that he bagged to all hell before selling it to the dealership or current owner, making it just as likely to end up in the same situation as the Grand Am. If we find a gem then we are totally the winners. If we get a lemon then we are in the same boat as right now.

Dealerships (and private sellers) sometimes have nice vehicles that are only a couple of years old that are a “fair” (sometimes) bit less than the ticket price of new vehicles too. I find this situation just as tricky because finding that relation between price drop and the age/kilometers on the vehicle is not a clear science. Dealing with (car) sales people can be challenging at the best of times and they usually try to make negotiations lean in their favor. This is to say nothing about having to take what is there/not having the luxury of picking the options and features you most like. All of this is happening at the same time as the price, or monthly payment amounts go up from the aforementioned options.

New vehicles are great. They have that smell in it that sadly fades after a while. Friends and family ooh and ahh over the new purchase for a while, and you know how it was driven from day one (save for some test drives it was likely on). You get the best warranty available, as well as interest payments on loans as low as 0%. The big issues here are the cost is always going to be the highest here (a $20-30,000 loan is huge for most people I know) and the novelty wears off eventually (the shiny new toy becomes old news as the next biggest and best thing, complete with bells, whistles, and trinkets rolls into the market). I’m also familiar with the term buyers remorse. In our particular case, even though the cost might be highest, it is somehow nice to know that we will not need to seriously consider getting a new vehicle for like 8-12 years (we bought an Elantra last November). Reliability is key here.

A few factors we will need to consider when making our decision: Some of the improvements in fuel economy in vehicles over the last several years has impressed me and with gas prices high (and only set to rise) I know this will have to be a major part of our decision. With Edmonton (and other modern cities) sprawling at what seems like an uncontrollable rate I can not undervalue how far a tank of gas will take me. I am also thinking a bit in the future too of how my family is set to grow by one right away. At some point junior will have hockey and/or dance equipment and we may be responsible for chauffeuring around him or her and all of their friends - how big of a vehicle is big enough for these kinds of things? Will there be more kids (a future blog perhaps)? I love Canada with all my heart, and much of our year is absolutely beautiful; however, we all know there are at least a few weeks every winter where it gets brutal (roads, temperature, etc.) and getting around becomes difficult. In my neighborhood having a bigger vehicle (at least like a CRV size) would have made me late for work a few less times and avoided us getting stuck in several awkward situations (middle of a residential intersection). But, for much of the year such a large SUV is overkill, especially as mostly a commuter vehicle. Would I be the person people shake their heads at thinking to themselves: “why is only one person in such a large vehicle?” So many different considerations...

The long and short of it is that we will have to make a decision soon and even as I write this I am not certain which option seems best. Our city is not yet conducive to effectively using public transit and with a pregnant wife we will need two vehicles in our family, even though the timing of having to absorb this cost right now is horrible (is it ever a good time? hmm...). We will have to accept responsibility for all the pros and cons that come with our choice and hopefully it will be the right one. So in the near future prepare to hear me tell about how much I hate Grand Ams and how I regret getting the used engine, my 2006 Elantra that needs new brakes 9 months from now, my 2010 Escape that has unnecessary features I didn’t really want, or my Prius that I brag about its fuel efficiency (but that I secretly cry myself to sleep at night over the monthly payments I got myself into). Regardless of what we end up finding wish us well - we will need it as we head into the shark tanks (the metaphor I feel is most appropriate when I think about car dealerships). Thank you all for your thoughts and input into this huge decision.