Thomas Rogers
Well-Known Member
IMHO, one mistake is not the reason to dismiss an entire website as a resource, especially one as popular and heavily used as Edmunds.
TJR
TJR
What residual should you expect from a Ford?
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EddieS'04
In Memoriam 1950-2022
I have found my dealings that Edmunds TMV. To be fairly accurate.
Also, I was listening to an economist. He said if at a young age. If a person buys a vehicle and drives it at least 10yrs, before a new one. You will save aproxamitly $300K at your retirement age. Over those that lease or trade every 3 to 4 years.
Also, I was listening to an economist. He said if at a young age. If a person buys a vehicle and drives it at least 10yrs, before a new one. You will save aproxamitly $300K at your retirement age. Over those that lease or trade every 3 to 4 years.
Thomas Rogers
Well-Known Member
Eddie S,
That's an interesting stat you shared as provided by an economist.
Assuming it is accurate for a moment, one other thing to consider is that the person that keeps their vehicles at least 10 years will drive 5 new vehicles during that time, while the person who leases will drive a total of 12 new vehicles.*
The question one has to ask themselves is this:
Is it worth $300k to be in 7 more (12 instead of 5) vehicles during one's lifetime?
* This assumes purchasing/leasing new vehicles when starting at 18 years of age, and a retirement age of 65.
TJR
That's an interesting stat you shared as provided by an economist.
Assuming it is accurate for a moment, one other thing to consider is that the person that keeps their vehicles at least 10 years will drive 5 new vehicles during that time, while the person who leases will drive a total of 12 new vehicles.*
The question one has to ask themselves is this:
Is it worth $300k to be in 7 more (12 instead of 5) vehicles during one's lifetime?
* This assumes purchasing/leasing new vehicles when starting at 18 years of age, and a retirement age of 65.
TJR
Gavin Allan
Well-Known Member
I'd like to see the details and assumptions for this. I have not found to save any money driving old used cars. The cost to keep fixing crap that breaks can be more than the payments for a new one. My rule of thumb is that when I get 3 months of repair bills more than the payments, the sucker is going to be traded for a new one.
Of course, I am talking about properly maintaining my cars and keeping everything working as it came from the factory. I know a lot of people who drive clunkers that don't have air conditioning, the radio doesn't work, the power windows are shot, etc., and they don't seem to mind.
Kevin Lang
Well-Known Member
...and they're such deathtraps that I refuse to ride with them and drive the much less fuel efficient (so I'm told) ST.
TJR, if they keep the vehicle for "at least 10 years", how can you be certain that they will drive 5 new vehicles between their young age & retirement? They could drive the same car the whole way, in theory.
Where does the 5 vehicles come from? How can you calculate that they will drive 5 new vehicles before retirement? Are you saying that they get a new car every 10 years, foregoing the "at least"? Even so, you're saying that the person in question will only work 50 more years until retirement. If they're "young", say 20, then 50 years isn't going to get them to a time where they can retire comfortably.
It could, and should, but empirically it does not. Not with our cultural trend of encouraging rampant debt. We could assume that a person who would keep a car 10 years for the purpose of saving money is more fiscally responsible than most, but that might not be true. Even the most wanton spenders can have odd habits of frugality.
This nitpicking thing is really cathartic, my frustration at the effing flat tire on my ST is all but gone now; I can see why you do it so often TJR :grin:
Thomas Rogers
Well-Known Member
KL was assuming 10 year ownership for each new vehicle for the frugal case. Yes, Eddie did say at least 10 years, but I took the least conservative case.
I did say above 18 to 65 for the period of ownership for both owner profiles.
The point I was trying to make was that, yes, one could safe a bunch of money, but at the sake of being in fewer cars, longer.... and it could be far fewer cars. So, if you enjoy new cars, what is that worth?
TJR
I did say above 18 to 65 for the period of ownership for both owner profiles.
The point I was trying to make was that, yes, one could safe a bunch of money, but at the sake of being in fewer cars, longer.... and it could be far fewer cars. So, if you enjoy new cars, what is that worth?
TJR
Kevin Lang
Well-Known Member
So you did.
Is not 65 still early retirement though? I was under the impression that full "entitlement" didn't come until later, for anyone currently 18. (67 years old)
(Sadly, checking that number I re-learned that about 1/6th of the nation draws social security)
Isn't it worth $300,000 in total, for all 7 more cars you'd drive by not keeping a car 10 (foregoing the "at least) years? So each additional car driven would be worth 1/7th of 300k to a person who elects to take one. Rounding up, 43k per car.
Interestingly, discarding inflation, the cost incurred to drive an additional new car is more than the average new car costs. Personally, I'd keep a 43,000 dollar car as long as I could.
gary s
Well-Known Member
"My father has a 2004 Ford Ranger XLT super cab 4 door 4x2 with a 3.0L engine. Added options are a color matching cap, rubber mat in the bed, leather wrapped wheel, AC, PW/PL, cassesste/single CD with MP3."
your kbb link is for a different model.
FX4/Level 2/4X4/4.0L
so what is it ?
[Broken External Image]:
your kbb link is for a different model.
FX4/Level 2/4X4/4.0L
so what is it ?
[Broken External Image]:
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Gary,
If you can try to read, everything will make prefect sense.
The deal is done. 10,400 for the Ranger and the $28,910.00 cost us about $23,000 (Z-Plan and rebates). After tax, title, etc. Mom financed about $6,000 at 1.99% for a monthly payment of about $260.00 for 24 months.
The Ranger cost Dad about $14,000 7 years and 2 months ago. It was sold to the dealer for $10,400 for a total loss of $4,000 over 7 years. We can not find the original bill of sale for the Ranger, but I know the price was pretty cheap.
We are happy.
Tom
If you can try to read, everything will make prefect sense.
The deal is done. 10,400 for the Ranger and the $28,910.00 cost us about $23,000 (Z-Plan and rebates). After tax, title, etc. Mom financed about $6,000 at 1.99% for a monthly payment of about $260.00 for 24 months.
The Ranger cost Dad about $14,000 7 years and 2 months ago. It was sold to the dealer for $10,400 for a total loss of $4,000 over 7 years. We can not find the original bill of sale for the Ranger, but I know the price was pretty cheap.
We are happy.
Tom
gary s
Well-Known Member
tom,
your latest trade figure:
"The deal is done. 10,400 for the Ranger"
original trade number:
"Dealer offered him $9,400.00 for the vehicle"
then you post a link for a different model trade in.
follow it up with 2 different original purchase prices.
"everything will make prefect sense.". not really !!!
your latest trade figure:
"The deal is done. 10,400 for the Ranger"
original trade number:
"Dealer offered him $9,400.00 for the vehicle"
then you post a link for a different model trade in.
follow it up with 2 different original purchase prices.
"everything will make prefect sense.". not really !!!
gary,
If you can learn how to click one simple little button, much the same as you use to post stupid pictures that do nothing productive, I would know what you are trying to say.
It was a a typo. I don't know why I said $10,400 when it was actaully $9,400. Thank you for noticing that. It was a long day. Was up from 5:30 AM to get ready for work and did not get home from my parents until around 10 PM. I was pretty beat after a day that long.
I posted a KBB link for the exact same vehicle with my ZIP code as Buzzworth posted using his ZIP code. Looks like my ZIP code nets higher resale values than his.
Tom
If you can learn how to click one simple little button, much the same as you use to post stupid pictures that do nothing productive, I would know what you are trying to say.
It was a a typo. I don't know why I said $10,400 when it was actaully $9,400. Thank you for noticing that. It was a long day. Was up from 5:30 AM to get ready for work and did not get home from my parents until around 10 PM. I was pretty beat after a day that long.
I posted a KBB link for the exact same vehicle with my ZIP code as Buzzworth posted using his ZIP code. Looks like my ZIP code nets higher resale values than his.
Tom
gary s
Well-Known Member
"We are happy."
thats all that matters :driving:
thats all that matters :driving:
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Resale doesn't matter to me as i keep every vehicle till it dies.......
then i don't worry about this crap...LOL
Todd Z
then i don't worry about this crap...LOL
Todd Z
Les
Well-Known Member
Thomas Rogers
Well-Known Member
I think it is worth recognizing one think in this entire discussion.
The term "residual" is not being used 100% accurately in this thread.
Residual is more commonly and correctly used in car leasing, and equates to the amount left to finance or buy-back the vehicle at the end of the vehicles lease.
For example, a vehicle that MSRPs for $30,000 and has a purchase price of $22,000 after a three year lease. That $22,000 is the estimated value of the vehicle at the end of the lease term. That is the residual.
So, why do I bring this up? Isn't a vehicles trade-in value, or its value say after 10 years of ownership just another "estimated value?" Isn't that the same as residual?
Well, they are kind of the same, but not exactly.
The biggest differentiator is that residual values are not defined by the market at any point in time for that point in time, but estimated at the beginning of a lease period FOR some projected time in the future, ie. the lease term. There are authorities like ALG, Blackbook, etc that define residual values for given terms, for given vehicles. Pure and simple, residual valuation done in this way is "speculation"; speculation of a vehicle's future value.
A trade-in value on the other hand, is a more true, accurate indication of the market for a given vehicle at the CURRENT point in time. Residuals define an estimated FUTURE value for a vehicle. That is the difference.
The main difference as I see them, is that one is a more accurate reflection of what people are willing to pay for a vehicle, today. The other, less so.
I've had the opportunity to buy-back off-lease vehicles at less than the residual amount. I've seen vehicles come off lease and go for sale much higher than their residual values.
Residual is a funny thing.
TJR
The term "residual" is not being used 100% accurately in this thread.
Residual is more commonly and correctly used in car leasing, and equates to the amount left to finance or buy-back the vehicle at the end of the vehicles lease.
For example, a vehicle that MSRPs for $30,000 and has a purchase price of $22,000 after a three year lease. That $22,000 is the estimated value of the vehicle at the end of the lease term. That is the residual.
So, why do I bring this up? Isn't a vehicles trade-in value, or its value say after 10 years of ownership just another "estimated value?" Isn't that the same as residual?
Well, they are kind of the same, but not exactly.
The biggest differentiator is that residual values are not defined by the market at any point in time for that point in time, but estimated at the beginning of a lease period FOR some projected time in the future, ie. the lease term. There are authorities like ALG, Blackbook, etc that define residual values for given terms, for given vehicles. Pure and simple, residual valuation done in this way is "speculation"; speculation of a vehicle's future value.
A trade-in value on the other hand, is a more true, accurate indication of the market for a given vehicle at the CURRENT point in time. Residuals define an estimated FUTURE value for a vehicle. That is the difference.
The main difference as I see them, is that one is a more accurate reflection of what people are willing to pay for a vehicle, today. The other, less so.
I've had the opportunity to buy-back off-lease vehicles at less than the residual amount. I've seen vehicles come off lease and go for sale much higher than their residual values.
Residual is a funny thing.
TJR
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Gavin Allan
Well-Known Member
My Trac had some residue, but I got most of it cleaned up OK.:banana:
