Meaningful Returns

Assuming you are starting from scratch and don’t have the pile of cash already sitting around, is it better to:

1. Keep the old car for longer, risking the possibility of costly repairs, but saving up to pay cash for a replacement. Or,
2. Go ahead and trade-in or sell the old car, but finance more and incur additional interest costs.

Some more questions:

1. Gently used car with plenty of life and less depreciation ahead of it, but out of warranty? Or,
2. Brand new car with warranty and less time shopping well for used, but more time spent saving or more of the purchase financed (see above) and definitely lots of depreciation?
3. In an era of rapidly changing automotive technology, do you wait for a hybrid or electric version of the new car? If so, see above, and how does the increased efficiency and increased price impact those questions?

The most important questions:

1. What do you need?
2. What do you want?
3. How do you explain the difference between 2 and 1 to your values and priorities?