Why buying a new car and insuring it is the worst thing that you can ever do. A bit of experience has taught me that one buys a quality car that is a few years old, with moderate mileage and moderate repair costs. Before buying your car, take a visit down to the spares shop and price out some of the common repair items. In an older car you are going to need a few items ... So, price out the following ... Water pump, Fuel pump, Clutch, Slave Cylinder, Starter, and so on. Next up, look around at the cars on the road. You are looking at a 10-15-20 year old vehicle. You best value is a vehicle that is just outside of the financing time limit (10 years) . See if it is still ok after having been used of a number of years or if it is going to shit. Speak to the owners and ask them if they are still happy with their cars and what problems they have had. My prime choices have been Toyota and BMW. So, having priced out a few choices I found myself a BMW 530i (for long distance cruising) and a Opel Monza 2.0 (as an economical commuter) and a Toyota Hilux double cab 4x4. (not all at the same time) Dont rush in and buy it ... check it out for a few days. Show an interest, but work the price down. The dealer knows he cant get it financed, and cash buyers are few and far between. If you dont have cash, Take an extention on your bond for 50K. or take out a personal loan. Stuff financing. So, here is what you can buy for 50K .... cars.co.za/carimages/BMW-5+Series/BMW-5-Series-523i-e39-1998_642436v.jpg 15 Year old BMW. 260 000 KM. This car is good for at least another 100 000 to 150 000 km. So, now you drive it around for 5 years, and at the end of its life, at around 350 000, you can palm it off for half that to another lower income buyer for 25 000. So, your car has now cost you 25K over 5 years, that is R 5000 per year or just over R 400 per month. The Opel Monza sold new for R 8000 in 1993 to the government garage as an official car, I bought it 4 years later for R 5000. I sold it in 2012 for R 15 000 having made a profit of 3X. I put my ear to the ground and 2 weeks ago I bought another Opel Monza, for R 2000.00 I will dolly it up a bit and it will be worth 15-20K My Toyota Hilux Double Cab was going for 75K. Every day I stopped by the car sales place and looked at it. I never said a word. Every time I stopped by, the salesman knocked another 5K off the price. When he hit 55K, I said OK, done deal. 7 years later I am being offered 40 - 45 K every now and then, but sorry, she not for sale. Insurance ... Nahhh thats bullshit. I have an imported Chinese tracker where I can see where my vehicles are and I installed them myself. No-one, but no-one is going to find it. My vehicles are secured behind loked gates every night and no-one ever takes them. They never leave my sight. (Except when they go in for a service.) Now you tell me ... how much do my vehicle cost me in real terms. The BM I sold at a 25 K loss after 5 years. The Opel I made 10K profit, and its successor I will make another 10K profit. So, how much should I insure a bunch of vehicles for that will technically cost me stuffall. Added to which, the insurance on a older model car is insane. I checked. They will only insure it for something like 40% of value at an excessive premium. So what you do, is insure it for extention of third party, fire and theft, which a considerably cheaper premium, but honestly, I cant even be bothered with that. 20 years ... x 3 cars at R 1000 each = R 3000 per month, = 36 000 per year = R 720 000 I have saved myself over 20 years by not insuring anything.
Posted on: Sat, 19 Oct 2013 07:52:02 +0000
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