Balancing Gazelle Intensity with Hoopty Maintenance


#1

For all you Dave Ramsey fans out there, you know how much he harps on focusing every last penny at your pile of debt. My wife and I are both driving 8+ year old cars, and while they’re getting us by now, I don’t know that they’ll last through the end of our debt snowball. We’re looking at 3 years (if everything goes well, less if it goes better) before our debt is paid off, and I could probably expect another year or two out of mine especially (it’s an '04 Taurus, 170k miles). Should I be saving a little each month towards a replacement now at the expense of being able to pay our debts off faster, or should I wait until the engine explodes and hope I can find something under $1k, which is what our emergency fund is? How do you guys balance sinking funds with your goals?


#2

Hey Kyle - I was just listening to his podcast today and he addresses this very topic. Might want to give it a listen - #8492.

It’s hard to give specific advice without a true picture of your finances but… Your car should be a line item in your budget for maintenance and, if it were me, anything I didn’t use in that monthly budget would snowball until I needed to buy a new used car. I don’t believe your $1k emergency fund should be used for a car. A medical expense, loss of job, or house fire are more likely to be things I would tap into the emergency fund to cover.

I too drive a hoopty (01 Hinda CRV) and will keep that puppy until the doors fall off. She looks ugly but runs good. :slight_smile: Hope this helps but feel free Tom each new tun if you have any questions!


#3

Ha, I figured he would probably have answered it already, I just hadn’t heard it from him. Thanks for the response! The line item approach is what we’ve been doing, but I feel kind of guilty letting it pile up when we have so much debt. I just want it all gone!

Side note: aren’t CR-Vs the best? That’s what our other vehicle is, and that thing is a beast.


#4

I totally understand! What if you save the car line item up until a certain $ amount and then stop contributing. Like $3k. That way you have money for necessary car expenses but also enough to buy a new hoopty should it come down to it? Once you hit that mark the rest at debt. You’re talking about an expense that is inevitable in the next few years. Not an emergency (since you know it is coming) but a future expense. And perhaps someone here will point you in a different direction but that’s what I would do. :slight_smile:


#5

Totally like this approach. I also hate money just languishing in savings accounts, so we have sink funds setup for different things in betterment.


#6

That’s probably what we’ll end up doing. Thanks for reassuring me that we’re on the right path!