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Ramit Sethi
» $31,000 To Drive Your Beater Into The Ground -
Consumer Reports has put out a report that confirms what most people have known their entire lives, using something until you can’t use it anymore is cheaper than replacing it every five years. Everyone knows that a new car loses the most value right when you drive it off the lot and everyone knows that buying used it a better value proposition, so why did Consumer Reports even bother? Well, because until now, many of those maxims were merely rules of thumb with no hard numbers put to them and so CR puts some hard numbers. According to Consumer Reports, if you are willing to drive your car past 225,000 (15 years) instead of buying a new Honda Civic EX (their example car) every five years for that same span, you could save yourself $20,500 in costs plus earn yourself $10,300 in interest (5% interest rate, 3% inflation) on that saved money for a grand total of about $31,000. - Ramit Sethi