Sense to Save

Car depreciation: Eh, don’t worry so much

"As soon as you drive it off the lot, your new car depreciates by about a million dollars and twelve cents."

Is that how the saying goes? Something like that, anyway.

I got my car new in May 2006. In three months, "Shirley" will be two years old. She has 17,500 miles and is in fantastic condition. The car is a four-door sedan from an American-owned company.

I typically get 30 mpg in the city, but 25 mpg if my travels take me up and down some of the steeper hills of Pittsburgh. On the highway, though, watch out: I get 40 mpg.

My car is still worth more than I owe on it.

I checked with Kelly Blue Book and Edmunds, and both are listing it at about $1,700 more than I owe on it. The car has depreciated by about $1,000 from what it was purchased for in 2006.

That’s A-OK with me!

If I take that $1,000 and add all the fuel, oil changes, car washes, and insurance…I feel like that’s a decent rate for driving 17,500 miles.

For one thing, having a car was required when I worked as a newspaper reporter. And, I’ve used it to take quite a few trips from Pittsburgh to Indiana and back. Costly, but nowhere near as expensive as flying would have been.

So, for what it’s been worth to me in these last two years, it depreciating a little bit isn’t a big deal.

I hope to get at least 200,000 miles out of my car. My parent’s car has 240,000 miles (?!) and is still chugging along.

I have no intention of selling it ever, but it’s nice to know that it’s still worth more than I owe.

Yes, that means the car is financed. I understand that some people think that’s a bad idea, and would prefer to pay cash for a used car. I hope that for our next car purchase, we’ll pay a good chunk of it in cash, but it’s hard to say what will happen then. Would I like to walk into a car dealership and say "I’m paying cash, and you’re going to give me a great deal" ? Yes, of course.

In our case, we took out a 4-year loan on the car, and if we don’t make extra payments, we’ll end up paying about $1,000 extra in interest, or the way I see it, an extra $250 per year.

Get rid of pennies? My $0.02

Should we get rid of the penny? That’s the question posed at Gather Little By Little today.

He shows how the price of materials and production has gone up so much, that it costs more than $0.01 to make a penny these days.

But, should we get rid of those little Lincolns?

I say, "No way!"

I don’t use pennies much. In fact, I don’t use cash much at all. I use debit cards and gift cards for the most part.

But, I’m afraid of what would happen to prices of items if we had to round to the nearest nickel.

I doubt retailers would round down on items, so it seems prices would go up 1-4 cents to eliminate the need for pennies.

That $0.99 item? Oh, it’s now $1 on shelves. Add on 6 or 7 or more percent sales tax, and you’re looking at $1.07. Oh noes! I guess you’d better make that $1.10.

It seems that for most items, prices don’t end in a 0 or a 5. That means that if we were to get rid of pennies, prices of just about everything would go up a few cents.

Not a ton of money, but it will certainly add up over time.

What do you think?

A super-easy laundry tip that you probably already do

It used to be that my husband dutifully put his laundry in the hamper when he was done with it.

I was happy when he wouldn’t leave piles of clothes on the floor, but unfortunately, "when he was done with it" often meant after one wearing. Most items weren’t dirty at all!

At $1.25/load for a wash, plus the time it takes me to do, and factoring in earlier wear and fading on clothes–it becomes quickly apparent to me that washing most items after one wear was is not the frugal thing to do.

Now, we have a better system in place. I’m getting by with washing 2-3 loads per week, and I’m not washing clothes that aren’t dirty (I hope).

• All socks, underoos, and undershirts get one day of wear. It’s not reasonable to try to stretch those further.
• Shirts for everyday wear get the "sniff test" and "stain check." If it passes those tests, it goes back on the closet with a little trick: The hangar now is hung backwards so that we know the shirt will be on its second wear the next time around.
• As long as sweaters pass the sniff & stain tests, they are folded and worn again.
• Sweatshirts can be  worn quite a bit before a wash. I love the softness of a new sweatshirt, and I hate to see it get pilled prematurely.
• Jeans can be worn many many times without washing them. Do you know that for some untreated denim jeans, you’re not even supposed to wash them for the first few months? So, we wear them until they look like they need a wash, usually after 3-5 wears.
• Bath towels do not need to be washed after every use. They’re drying off clean bodies and then hung to dry–I don’t see the part where they get dirty. Changing the towels once per week seems more than sufficient to me.

By wearing clothes more often between washings, we’re saving ourselves work. But, we’re also preserving the life of those garments.

What are some laundry tricks you use?