Replace my X5?

[bluvalley]

Hello all,

Looking for advice on replacing my current tow vehicle which is a 2008 BMW X5 3.0. I use this to tow a 2003 CCD 22 ft and have been towing for over 3 years with the X5. It’s been an awesome truck, tows beautifully, gets great mileage, no mechanical problems whatsoever. I take about 4-5 trips per year, just towed from upstate NY to Florida in May. The problem is that the payments are getting tough to handle on my budget. I’m not behind on them at all, and in fact I’m a bit ahead on them, but it’s a strain. These days as everyone knows, we’re all looking for ways to make our expenses easier. I probably have at least another 5 years to go before I pay off this car. ugh. So I’ve been looking at a Nissan Frontier Crew Cab with a 6-speed manual transmission. My monthly expenses would drop almost 200 bucks if I went this route. I’ve been talking to friends about it and some of them even suggested I sell my Airstream!!! WHAT!!!

So should I stick it out with a car that has been great and that I really enjoy or bite the practical bullet and go for the Nissan?

I’ve always gotten the best advice from the great people on this forum, thanks in advance!


James

[Road Ruler]

IMHO the X5 is one of the ultimate TV's. I have found that trading cars is expensive. There are many costs involved with trading. Figure on roughly $5,000. in expenses.

Is the X5 a "truck"? Don't think so. It is more of a HD raised sport sean.

[easplund]

That's just crazy! Can't you find other places to cut $200? Cell phones, or cable tv, or something else equally worthless?

[DKB_SATX]

I don't mean to be harsh, but it's important to look at financial issues with a pretty cynical perspective.

You have 5 years to go to pay off a vehicle you've already had for 3 years? Am I reading that right?

It is very difficult to change vehicles without taking a financial hit, so you have to look at the numbers very carefully before taking that route, but it sounds like you have an unfavorable loan on the X5. In a perfect financial world, one would rarely finance a depreciating asset, but few of us live in that kind of world. I've never bought a newish vehicle with cash. That said, it's usually best to get the shortest loan that has good terms.

Just guessing from the age of the X5 and the length of time that remains to pay, you may not have any appreciable equity in the vehicle. Is the balance on the loan near or above the private-party resale value of the vehicle? If that's the case, all you'd be giving up is your emotional attachment to it. If you have some real equity, it may be a different decision for you.

If you do go for the Nissan, the best bet would be to put a fair chunk of that $200 into paying the Nissan off early, then keep it until it starts to cost you as much as a new truck payment. If you keep the X5, try to pay it off early. 8 years is way too long to finance a truck, and pretty much any consumer-focused financial expert will agree. (Vendor-focused financial experts will of course tell you to go for it and keep trading up, it maximizes their income.)

[bluvalley]

DKB_SATX

Wow, thanks so much for such sound advice. I wish I had been thinking that clearly 3 years ago! Yes, I did not make the best choice on my loan, although my interest rate is only 0.9%. I do have a dreaded balloon payment in about 20 months (which I'll have to finance). Hence the 8 years to pay off the car. The good thing is that have paid for the bulk of the depreciation on the X5 so buying new I would have to start all over again.

Like many others my freelance work has basically died since then so there goes the income.

I've had my car appraised and I'm exactly even on the trade so I wouldn't be losing anything, so it would be more of an emotional sacrifice.

Going to talk to another dealer this weekend so we'll see what happens.

Thanks again for all the comments, I really appreciate it.