First-Time Advice

By
eric
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A friend whose wife is about to give birth asked my advice about what to get as far as first-time family wheels.

My first advice was to not buy anything new; to let someone else buy the depreciation first. This amounts (typically) to a 30-40 percent discount after about 3-5 years, depending on the make/model vehicle. A three-to-five-year-old vehicle is also likely to have fewer “advanced driver assistance technologies.”

The farther back in time you go, the farther away you get from these “technologies.”

The downside here is the cost of financing a used vehicle if you haven’t got the money to pay cash for it. The interest rate on a used car loan is almost always significantly higher and the loan duration shorter (on account of depreciation). The only way to avoid the financing hit – and avoiding vaporizing the money you saved by letting someone else pay for the depreciation – is by paying cash.

But that’s hard, especially for young, first-time buyers.

Although not necessarily.

It is still possible to buy a used vehicle in good shape for around $7,000 or so – a sum that’s conceivably possible to pay in cash. If you’re willing to shop for a vehicle most people would rather not have. The archetype here being the minivan – any minivan – but these are by no means the only such vehicles. Think vehicles elderly people might like. Think vehicles most people dislike, especially on account of how they look (e.g., the infamous Pontiac Aztek, which is an ugly thing but not a bad thing). 

The key thing being to avoid vehicles almost everyone likes. That creates demand – and demand means you pay for it. But a ten-year-old minivan is kind of like the old sofa you can sometimes score after someone leaves it by the side of the road. The cushions might be a little flat but there’s still plenty of life left in ‘er.

And the price is right.

A key thing to keep in mind is that when you pay in cash, you will have cash – to pay for whatever might go wrong with what you bought. Usually, it won’t – and even if it does, it’s usually not catastrophic. You might have to put $1,500 into a $7,000 vehicle once every couple of years so. It beats putting $400 into the mail every month.

Also, never forget that you are already paying for what might go wrong when you buy a new car. The warranty that comes with the new car isn’t free. You paid for it when you bought the new car.

And that warranty will run out – usually right around the time you’ve (finally) paid off the loan you took out to buy the new car. How much is that new car smell worth to you?

Especoally once it’s gone.

Another factor that’s wise to consider is what it’s going to cost to insure whatever you buy – or finance. If you pay cash, you don’t have to buy more than a basic, liability-only policy. If you finance, you will have to buy a full coverage policy and the cost of that will relate to the cost of repairing/replacing the vehicle, if it’s damaged in an accident. Insurance can cost as much as car payments used to cost. If you didn’t consider that cost before you bought/financed whatever you bought/financed, you might find you’re unable to afford to keep whatever you bought/financed.

As far as particulars – which cars are good cars for a first-time family – herewith some suggestions:

Toyota Siennas made before 2023 – after which Siennas no longer come standard with the extremely reliable 3.5 liter V6 engine that does not need a turbo and isn’t paired with a hybrid drivetrain. A just-as-good-choice is the Honda odyssey, which still comes standard (as of 2024) with Honda’s excellent V6 engine.

If you can’t abide the thought of a minivan, check out the Honda Pilot – or the Toyota Highlander. They look like SUVs but are related to their respective manufacturer’s minivans. 

Toyota RAV4s made up to the current model year; these are still powered by a naturally aspirated (no turbo) four cylinder engine that’s not too small for the application (and so doesn’t need a turbo). Also still standard is an eight speed automatic – as opposed to the continuously variable (CVT) automatics that a majority of mid-sized/compact-sized crossovers now come standard with.

Subaru Crosstrek wagon with six speed manual transmission – paired with the standard non-turbo engine. These were available through 2023 and if you find one, you’ll avoid the Big Brothery “EyeSight” driver-monitoring “technology” built into all 2024 Subarus. The Crosstrek is very roomy and practical for its size and comes standard with AWD, making it a great snow-day vehicle, too.

VW Taos. This small-but-roomy crossover is almost the same size as the better-known/better-selling Tiguan but much less expensive – $23,995 to start vs. $28,880 to start. Two or three-year-old examples ought to cost less than $20k. This little wagon is also available with fun, family-friendly accessories such as a tent attachment (Crosstrek offers that, too).

Some  other vehicles to consider are older, American full-size sedans such as the six-passenger Ford Crown Victoria (made through the 2011 model year) and the Dodge Charger/Chrysler 300, which is a little smaller but still a roomy five-passenger rear-drive (AWD available) sedan that’s inherently safe because of its size and weight – and not-very-well-known small vans such as the Ford Transit Connect and the similar Nissan NV. These were available in a variety of configurations and can easily be reconfigured to suit your particular wants and needs.

The Toyota Avalon (which is basically a larger Camry) is also an excellent prospect.

As a general rule, shy away from any vehicle that has an engine that’s inappropriately small for its size and so needs a turbo – there it is, again! – to make up for its lack of size. These small engines are under a lot of pressure and – if past is precedent – such engines tend to not wear out faster than larger, non-turbocharged engines; these may burn a little more gas but they are less likely to burn a lot of oil.

Conventional automatics that shift through gears are a safer bet – long term – than CVT automatics that vary ranges.

The bigger the wheels – the more expensive the tires. And the sooner you’ll need to buy new ones, too.

Perhaps the best advice there is to not buy when you have to. So that you have time to think about what you’re buying and time to make sure it’s the right one to buy. If you wait until you have to buy something – anything! – the odds are greater it’ll be the wrong one.

. . .

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19 COMMENTS

  1. This is why my cold, dead, body will have to be pried out from my 2012 Subaru Outback 3.6R Limited.

    The 3.6L flat six and 5EAT 5 speed automatic transmission (no CVT, just gears, clutch packs, and pressure plates) is one of the most bullet proof setups made if properly maintained.

    And it has nothing that can rat me out in it.

  3. That’s a hard one. I looked for the kids cars based on price and waited until something fit the bill.
    My requirement was 4 door, 4 cyl, no turbo or cvt.

    After a few months of searching, I got lucky with low mileage cars. Yes, they are ones no one else prob much wanted.

    So, maybe it is a good idea to search based on budget and features.

  5. If on a really tight budget, you can’t go wrong with 1990’s Buick sedans. The classic comfortable grandpa car, but a solid ride with mostly V6’s with good power. Most likely was probably serviced regularly, garage kept and may have lower and gentle miles on them.

    Though ones coming out of estate sales now (2024) have probably sat for a decade or more so you have to be careful and plan for some restoration work.

    Another place to find affordable used cars may be a local junk yard. Sometimes family members bring in old but mint grandpa cars since they don’t want to deal with selling grandpas last car. A local lot posted a really nice very well kept, clean, no rust, garage kept 60,000 mile, 2002 Dodge Caravan. The only thing to worry about it, is that it hasn’t be plated since 2017 so it probably has sat for close to 8 years. At minimum new tires a battery etc.

  6. > If you pay cash, you don’t have to buy more than a basic, liability-only policy.
    Well, you don’t have to, but how much can you afford to lose?
    You pays your money, and you takes your chances.
    And the insurance rates for a married couple driving a used minivan will be significantly lower than for a young, single male driving a Porsche, who, if he can afford the insurance, is probably either a Gulf Arab, or the scion of a wealthy family.

    Personally?
    I have always, and still do, carry collision on my ’89 F150, even though I paid cash for it.
    My previous vehicle was an ’85 Ford Ranger, which was totaled by an AGW on a motorcycle (which totaled him, too). County of Riverside took six months to investigate the crash, and determine their employee was at fault.

    Because I carried collision on my vehicle, my insurance company settled with me in ~30 days, which meant I could get on with my life. Otherwise, I would have been in financial limbo until the County finally had no choice but to admit that I was not at fault.

    Your decision may be different, but to me, the premium is worth the peace of mind of letting my insurance company fight with the other guy’s insurance company (if any*).

    *How many illegals carry US auto insurance? Not many, I’ll bet.

  7. 1950’s and 1960’s had better cars…..2024…the worst…getting worse….then all EV’s…total garbage…the end…

    A good way to get people out of cars…make them very expensive, unreliable, spyware filled and horrible to drive.

    Bring these back for poor slaves….soon there will only be $50,000 EV’s…the slaves will walk…

    1966 Fiat 124 Berlina 4 door sedan….4th biggest selling car in history…millions were sold in multiple countries, under different names…

    It ate VW beetle sales…..it forced VW to develop the Golf

    they are very simple, you can fix it yourself…the new cars are unfixable, computer filled crap…

    5 passenger, 4 wheel disc brakes, rack and pinion steering….these were advanced tech back then…. no computers, all analog…better handling then a lot of sports cars…

    historic 4 cylinder engine designed by Lampredi…the Ferrari engine designer…great engine…

    curb weight 1885 lb….new cars are 3000 lb and up…

    New MSRP $2000….$19,000 in 2024 dollar
    One sold on BAT recently for $13,000

    https://www.youtube.com/watch?v=NcZbE-X6KFw

  9. Once again great advice for first time buyers. Another advantage of buying used is that they already come dented and scratched, no stress from dreading a dent or scratch on your new car because it’s already there!

    Another advantage of an older vehicle is that more garages are used to working on them and are equipped to work on them as opposed to buying the newest ones.

    • “ Once again great advice for first time buyers. Another advantage of buying used is that they already come dented and scratched, no stress from dreading a dent or scratch on your new car because it’s already there! “

      Yep! You must be married to one of my wife’s distant relatives. Didn’t take me long to figure out –
      ‘you can’t own anything nice with women and kids around’.
      (Saint Sparkules Chapter 1 verse 1)

      Over 47 years I’ve got too many examples to list here.

  10. Since the car is being bought because a little person is being hatched, I have some random thoughts.

    -Make sure there’s enough room to maneuver the car seat in & out

    -No matter how hard you try, it’s gonna get messy bc kids are messy

    -Rear control of temperature / fan speed is nice to have

    -Leather is easier to clean than cloth for the guaranteed baby burp up goo

    -Somewhere to hang a portable screen to stream or dvd is a good thing. Keeps ’em entertained on trips

    -Make sure the car has room inside or accessible from the outside for the guaranteed roadside diaper change

  11. “Perhaps the best advice there is to not buy when you have to.”

    This times a million. I’ve spent the last couple weeks trying to find a suitable replacement for my daughter’s old Outback. In the process I bought a beautiful Q5 from my neighbor (which is an extra vehicle for us), enabling me to let her drive one of mine while I try to navigate the shady world of Subarus in Colorado. Which of course violates the shit out of this other excellent bit of advice:

    “The key thing being to avoid vehicles almost everyone likes.”

    Oh well. Great essay, Eric.

  12. ‘Perhaps the best advice there is to not buy when you have to.’ — eric

    Before the pandemic, I regularly trolled Craigslist and used car sites, looking for bargains. Then, fueled by covid cash, the user car market exploded. One index called Mannheim Used Vehicle Value Index [search it] nearly DOUBLED from spring 2020 to late 2021. Now it’s slid by about 25%. It may continue regressing until it reconnects with its old trend line, another 20% down from here.

    Fun fact: the yield on 3-month US Treasury bills (5.38%) is higher than the yield on 10-year Treasury notes (4.23%), and has been for over 500 days. This happened only three times before: 1929, 1974 and 2007. Afterward, in each case, a severe recession and a stock market smash followed. Is this time gonna be different? Do you feel lucky? Are you all bulled up on NVIDIA?

    Point being, bargains emerge for cash buyers during recessions. Just ask this nattily-attired gent on Wall Street (photo image):

    https://tinyurl.com/5n7dsn36

    And here’s the story behind the story:

    The car pictured in this photograph was a 1929 Chrysler 75 and sold new for around $1,500, equaling about $24,000 today. Its $100 asking price after the crash would be around $1,600 today.

    Walter Thornton (pictured) recovered quickly after the stock crash and started a modeling agency in 1929. As the Walter Thornton Modeling Agency grew, it was considered one of the “Big Three” and one of the largest model agencies in the United States. The agency was known for its World War II era pin-up girls.

    As a wise man once quipped, “I spent 95% of my money on women, fast cars and booze. The other 5% I wasted.”

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