SUVs are worth so little that it could take 15 years for a more fuel efficient vehicle to pay for itself in gas savings. Before rushing to trade-in your gas-guzzler, do the math and make sure it isn’t economical to hold onto your unfashionable behemoth. Here are three questions to consider…
- What’s The True Cost Of A Trade-In? Use Edmonds’ calculator to price-out the cost of a trade-in. The results may be surprising: trading a 2005 Ford Expedition for a 2008 Toyota Highlander hybrid won’t produce savings for almost 15 years.
- Is A Small Car Practical? You bought a SUV for a reason, right? RIGHT?! Yeah, think about that for a moment before looking at a new Smart.
- Are You Thinking With Your Brain Or Your Gut? Gas prices are rising, but the overall cost of ownership is stable. Your insurance bill is probably the same, and your mechanic isn’t raising prices. Now might seem like the right time to get a new car, but “if you’re selling an S.U.V. or trading it in, you’re selling an asset at the low ebb in its value and trying to buy an asset that’s been bid up in value,” says Mr. Nerad of Kelley Blue Book. “In stock market terms, this wouldn’t be a propitious time to make that kind of trade.”