The cars people keep for 15 years

I agree, and this is something that has long mystified me.

I'm not sure what the situation is in the US, but in Britain, almost everyone I know either leases their car or buys it on a payment plan. A lot of them then sound very stressed about making their monthly payments on a car that they'll either never own, or will own in five years when it's worth 30% of what they paid for it.

I'd much rather let someone else do that and take the depreciation hit. I'll buy the car a few years later, when it's still absolutely fine, but costs a lot less. And I've never borrowed to buy a car: the money comes out of the savings account and I wouldn't spend more than a couple of months' salary on one. That way, I get to enjoy the car without being all stressed.

And because of that improvement in quality (which happened about 15 years ago with Japanese and German cars), I'm really not missing out: if I buy a two- or three-year-old car, I'm getting something very good. My current car is seven years old (I've owned it for three years), and feels like new. It depreciated by A$45,000 (about US$35,000) in the four years before I bought it, and it's depreciated by A$5,000 in the three years since I bought it.

I'd be even more into this if I lived in Britain: cars there depreciate incredibly quickly, and a two-year-old car there costs about 50-60% of what its equivalent in Australia would cost, even though their prices when new are about the same. And yet, British people seem to insist on buying or leasing new. It's odd.

My record was in Hong Kong, because Hong Kong people really don't like buying used cars. I bought a car which was eight years old, but had only done 54,000km (because there is nowhere to go if you live in HK) and was in like-new condition, and it had dropped from HK$2.2m (US$280,000) new to HK$50,000 (US$6,400) when I bought it.

 

That's me. I have had my 1996 Subaru Legacy wagon, bought in 2000 with about 130K miles on it already, for 18 years now and going. I bought my Prius used with even more mileage on it (150K miles) two years ago. I've done maintenance/prevention (like oil catch can) to make sure that it will last as well, and very well might have it for 15 years as well. I've only owned one other car, a used Subaru Loyale, that was unfortunately totaled after a year of ownership. All my cars were bought used with cash. I don't see myself ever buying a new car. It doesn't make sense for the way I think financially.