Depreciation

[souprmage]

I've thought a lot about this same thing and for me and my own personal decision I've made a choice to purchase. I almost never do anything "stupid" with money.

I make a decent living wage, have very few bills and I'm going to make a dumb decision with the Mustang that won't impact those around me. I have retirement and savings and at some point I'm going to look back and regret not "living" a little. For all I know I have cancer right now....

Note...If you are young and don't have your stuff straight I highly recommend staying away from depreciating assets.

I'm exactly where you are, and I share your thoughts completely.

I've taken care of all the fundamental responsibilities; 401k, children's college funds, etc. Now it's time to live a little.

This will be my first 'Me' car, and the important part for me is to get all the options I want so it fit's me and I never want to let it go. For now, it's going to be my DD as I'm not quite that flush to have two cars for myself, but hopefully when I pay this one completely off, I'll not have to trade it in when I get another. But who knows, I'll worry about that later. For now I'm too busy day dreaming about my Stang when I drive my Jetta.

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[OppoLock]

Serious question: the depreciation rate shouldn't matter too much if you hold onto the car for a solid 5 to 6 years, right? That's how long I plan on holding onto mine. I figure it'll plateau eventually and then the resale will be more dependent upon its specific condition and history at that point.

 

[GNS]

^ I'd be interested in knowing this as well. 5 to 6 years is what I'm looking at.

 

[Tony Alonso]

Serious question: the depreciation rate shouldn't matter too much if you hold onto the car for a solid 5 to 6 years, right? That's how long I plan on holding onto mine. I figure it'll plateau eventually and then the resale will be more dependent upon its specific condition and history at that point.

^ I'd be interested in knowing this as well. 5 to 6 years is what I'm looking at.

From a purely financial point-of-view, to answer that question, you might consider the operating (fuel, insurance) and maintenance costs to determine your cost of ownership over that time. However, I am not a financial person, so I personally just look at the value remaining and think "how fast could I convert this into cash, if needed?".

After 5 or 6 years, I've seen each of my Mustangs (I've been buying them since 1995) approach various plateaus, based on the options, the mileage, and most importantly, how much I modified them. The more modified they were, the more the value was affected because my customization vision is different than potential buyers.

The most recent example for me was my 2003 Mach 1, which had changes in the exhaust, the air box, and springs. I sold it in 2010, 8 years after I bought it. I found a buyer fairly quickly, mainly because I probably was about $1000-$2000 less than some other examples I saw sold at that time. It was my decision to do that to get it to move quickly. If I had held on to that car (it was retired from daily driver status back in 2006) today, I might have been able to get more because it's been further out and my modifications were less than some of the others I've seen. The overall mileage would have been lower than some of the cars coming on the market now as well.

In summary, "it depends", but the more modified it is, the more likely it would have some bearing on the price you might get and how easy it would be to sell. Of course, if you have no plans to sell, then you are just paying for something that brings you great joy and satisfaction - that is priceless.

 

[deeps29]

Serious question: the depreciation rate shouldn't matter too much if you hold onto the car for a solid 5 to 6 years, right? That's how long I plan on holding onto mine. I figure it'll plateau eventually and then the resale will be more dependent upon its specific condition and history at that point.

Check out "Compare new vehicles" feature at edmunds.com. Here is a comparison between 2014 V6 Premium and 2014 GT Premium. If you scroll down, you will see 5-year ownership cost. Keep in mind that insurance and gas cost listed there are usually exaggerated. Your own experience with those will vary.

Also note that this is based on 12000 miles a year and a complete stock car. Depreciation values they have listed are pretty close to real market.

 

[Old 5 Oh]

^ I'd be interested in knowing this as well. 5 to 6 years is what I'm looking at.

You are always better off to keep a car 5-6 years rather than 2-3 years, from a depreciation standpoint. The first couple of years are murderous both in terms of percentage depreciation, and in dollars lost. (20% of $40K is a lot more than 20% of the $25K remaining after three years, and so forth.)

Even a clapped-out New Edge with 150,000 miles is worth several thousand dollars, so if you start with a 2006 for $12,000 or so, you can drive it for several years and resell it for half that. Pretty cheap transportation. But of course, none of us on this forum plan to do that, do we?

 

[dkmcclelland]

Well as much as I love the new Mustang, I've talked myself out of one for now. I'm 24 and new in my career. I'm looking into an older car (3-6) years old that's still sporty and has leather, etc, for a lot less money... I figured it'd be financially smarter than buying a brand new car right now


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[JoeDogInKC]

Well as much as I love the new Mustang, I've talked myself out of one for now. I'm 24 and new in my career. I'm looking into an older car (3-6) years old that's still sporty and has leather, etc, for a lot less money... I figured it'd be financially smarter than buying a brand new car right now


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Come on over to Kansas City and I'll make you a good deal on my 2013 GT Premium.

 

[likeaboss]

If it makes you feel better even the GT500's are taking a big hit on the used market.

 

[Reg_2015]

Cars will always depreciate, even the Mustang and even in the UK. but that depreciation will be slow and by not much. A brand new 'standard' vehicle sold in the UK inn the first year loses by thousands of pounds in the first year alone.... It's just a fact of life, as same as how all brand new electronics and tech depreciates after a little while or how the cost of living rises every single year......

As member TONY ALONSO mentioned in this thread, the Mustang is an emotional car. It's not just a car, nor just a tool for getting from A to B. If it was, I would have bought any car a long long time ago when I moved to Europe. I didn't even bother getting my British/EU driver's licence until recently. Nothing interested me and the only car worth my attention was over 100,000 pounds; ridiculous amount of money, in my opinion to pay for something that seemed too impersonal. The stang though, have had always had me on a hook. Always knew how to push my buttons ever since my childhood and my previous, one and only '65 GT350 is one of the FEW things I still desperately miss from my previous life.....

The 2015 Mustang won't take it's place. It'll just be the grandchild of the old soldier for me to love for a long long time. If I'm lucky, I intend to love this new generation for at least the next couple of decades; therefore the word depreciation should not come into play (mostly) when talking about Mustangs....

Apologies for spouting on.......

 

[Tony Alonso]

As member TONY ALONSO mentioned in this thread, the Mustang is an emotional car. It's not just a car, nor just a tool for getting from A to B.

If I'm lucky, I intend to love this new generation for at least the next couple of decades; therefore the word depreciation should not come into play (mostly) when talking about Mustangs....

Apologies for spouting on.......

Reg, looking forward to see what you are getting The only time I've ever come out financially ahead on a Mustang is when I bought AutoArt's 2003 Mach 1 1:18 diecast in azure blue Beyond that, it's been more about the passion.

I will say, however, the most recent Boss 302s are an example of limited depreciation. Based on various forums posts for what people are selling them, that particular version seems to be doing quite well. The 2012s that sold for $43,000 US new are still going for $35,000-$38,000, which is not typical of the mainstream models.

 

[BOSS 1601]

If it makes you feel better even the GT500's are taking a big hit on the used market.

Really ? I see them doing pretty well in the New England area. My 2013 BOSS after nearly 2 years has gone down about 10-12% according to KBB. Of course, mine is perfect, low miles and not modified.

My experience with cars is that the most highly desirable special models do a little better in resale for the first several years. I'm thinking recent GT-R, M3 and even the WRX when it first came out. Once the new, higher performing model arrives, depreciation really hits hard.

Buy what you want and enjoy. If finances and depreciation are a huge concern, you will never win with a car (except a Ford GT).

 

[Wild Stang]

Really ? I see them doing pretty well in the New England area. My 2013 BOSS after nearly 2 years has gone down about 10-12% according to KBB. Of course, mine is perfect, low miles and not modified.

My experience with cars is that the most highly desirable special models do a little better in resale for the first several years. I'm thinking recent GT-R, M3 and even the WRX when it first came out. Once the new, higher performing model arrives, depreciation really hits hard.

Buy what you want and enjoy. If finances and depreciation are a huge concern, you will never win with a car (except a Ford GT).

Or maybe a classic ;)

 

[Wild Stang]

Well as much as I love the new Mustang, I've talked myself out of one for now. I'm 24 and new in my career. I'm looking into an older car (3-6) years old that's still sporty and has leather, etc, for a lot less money... I figured it'd be financially smarter than buying a brand new car right now


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I'm a similar age and in a similar situation... but still haven't managed to talk myself out of it. :shrug:

 

[dkmcclelland]

I'm a similar age and in a similar situation... but still haven't managed to talk myself out of it. :shrug:

Part of me wants to find a decent new age that I can pay cash for and just deal with not having the power the newer ones have while still enjoying the sound


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