I saw this news article in the local paper last week, and thought it interesting. So, I thought I would share it with you:
A local businessman in Allentown, the owner of Jim's Appliance Service, had been driving a 1991 Chevrolet Astro van. The van had been paid off a long time ago and averaged only about 11 miles to the gallon.
With gas prices rising, the businessman decided to check out a Scion last December. Looking at a 2005 model, he found out that 5 of his tool boxes would fit nicely in the cargo area. So, he decided to purchase it.
What he had figured out was that his Chevy Astro van got 11 miles to the gallon, therfore, costing him about $545 per month in gas, but no monthly car payments. The Scion gets 28 miles to the gallon, costs $214 in gas per month with a monthly car payment of $327. (The above is based on the cost of $4 per gallon of gas.)
Now, in doing the math, the Astro van's total cost was $545 per month, where the newer Scion cost a total of $541 per month, saving him $4 per month. The gas savings alone are enough to cover the monthly car payments giving him a few dollars left over at the end of the month.
Even though he may be paying about the same amount every month for his business vehicle, he gets a newer model with better gas mileage, eventually saving him money.
I guess we're all going to end up thinking this way... it's inevitable. The savings becomes even greater as the gas prices continue to go higher.
I wonder how much my car is really costing me? That could be quite scary.
Good morning Brigita -- neat use of reality math! :) Thanks for sharing the story. Enjoy your day. Regards, C.
Ron:
As the gas prices continue to increase, we need to do something to save money. Who knows, we may even end up going back to using the good old horse and buggy. Maybe the Amish have the right idea.
C Tann-Starr:
Maybe they should teach this sort of math to the kids. LOL
Have a great day!
I like the math too. Maybe that is why Toyota is selling so many Hybreds. Or better yet, maybe someone will find out why there are foreig countries allowed to drill for oil off our shores, but American Companies can not.
That's a good point, Linda! If it's on American property, the Americans should have a right to it. But, that just makes too much sense. LOL
This is an excellent post Brigita!It makes alot of sense but not everyone would look at it that way!
You are right..it is like having a free car and a few extra dollars a month to drive it!
BLR Guy:
Always helps to save a few dollars where you can, especially these days.
Brigita, that is the main reason that I parked my van - (12 MPG) and purchased my Prius (52 MPG). The money that I have saved I put on the back end of the note... I purchased the car May 2005 - I will have it paid for in October of this year!!!
Michael:
It seems like this is the way to go these days.
Good post. i am going to do the math for my car and see if I should buy a new car.
Thanks, Gita!
Maybe we should all do the math and see if a new car is in our future. LOL