Deciding on Whether to Upgrade Car

blueyez on 13/01/2024 - 01:21
Last edited 13/01/2024 - 13:45

Hey all,

I currently have an old but reliable petrol car, and would love to eventually own an EV one day. Main reason for an EV would be cheaper to do longer road trips solo, I'm aware the up front cost is obviously more.

I don't know how much life my car has left in it, the odometer is sitting around 110k km and only major expense might be timing belt when I get around to it. It's a 2007 Barina sedan.

However, due to my increased income and possible tax savings etc I'm considering getting another car to replace it.

My dilemma is a mix of financial sense and longevity of the next car I pick.

My annual tax income bracket (not on the highest) will result in the tax paid hovering around 32k if I had no salary packaging applied. I'm maxing out $15,900 on the mortgage via salary packaging. I've only recently become a home owner and am throwing all I can at the mortgage.

I don't have a HECS debt or dependants. I live in a metro area but would love long roadtrips at minimal expense as I'd go solo. I did consider getting a motorbike, but I love driving more.

Based on this, and factoring in how EVs will change in the future, what would you choose?

  1. Hybrid (not fussed if new or used)
  2. Cheap EV (one of the cheapest new models to take advantage of the FBT exemption)
  3. High range EV (splash out on a BYD Seal as I love the look of it and the range on the Premium)

Editing to add a 4th option:
4. I technically own 2 cars, intending to sell the other. Maybe I could sell both of them to get something more economical, maybe a cheap hybrid. Guessing the total amount I'd be able to sell for would come up to $8,000 - $13,000. I can add to this out of my own pocket. I believe you can also lease second hand cars, if that's the better choice than buying outright?

I hope I've included enough information for your constructive thoughts. I'm still trying to get my head around how salary packaging and novated leases work, and whether they are a good option in my circumstances.

Automotive Car

Comments

  • brendanm on 13/01/2024 - 01:22
    +1

    What's your current car?

    • blueyez on 13/01/2024 - 01:24

      2007 Barina

      • brendanm on 13/01/2024 - 01:58
        +19

        Oh, get something else then.

        • blueyez on 13/01/2024 - 02:00

          Not a Holden fan? :P

          • Caped Baldy on 13/01/2024 - 06:52
            +3

            @blueyez: There's a reason Captiva's are nicknamed Craptiva.

            I personally wouldn't trust the Barina in an accident.

            • Murkymerv on 13/01/2024 - 08:31
              +2

              @Caped Baldy: You shouldn't trust any car in an accident , watch the news and see how safe your cars are.
              . On a lighter note , unless you've got major problems = exspense with your car , keep it !

              • blueyez on 13/01/2024 - 11:16

                @Murkymerv: Yep agree. A family members Forester didn't have the air bags go off in an accident that ended up writing off their car.

          • barge-in hunter on 13/01/2024 - 08:50
            +5

            @blueyez: They weren’t manufactured in Australia, so aren’t really Holdens.

            They were manufactured by Daewoo ”GM South Korea” and were genuinely terrible quality.

            Fwiw, they only scored an ancap rating of 2 when tested against the 2006 safety standards, so I would upgrade if only for the safety of my passengers and myself

            That’s not to say I would upgrade to an EV - for me, they’re not quite mainstream enough yet (still early adopters issues here and there). I’d go for a $10-15k second hand petrol car that’s far more modern and safe, with the intention of upgrading to an ev in a few years

            • blueyez on 13/01/2024 - 11:25

              @barge-in hunter: It's a hard choice. Do I invest in my cheap car to run it into the ground or sell it for what I can to get something else, but I'd at least aim for a hybrid.

              My first car was a Daewoo 1.5i, I loved that thing too lol

              https://commons.m.wikimedia.org/wiki/File:Daewoo_1.5i_(22247665793).jpg

              • barge-in hunter on 13/01/2024 - 12:35

                @blueyez: I personally don’t think it’s a hard choice; but that’s my view, with my opinions on mixing safety while also paying off debt

                It’s easy to increase your spending just because you’re earning more. That’s how the capitalism wheel keeps turning

                • blueyez on 13/01/2024 - 13:33
                  +1

                  @barge-in hunter: Yeah, I guess another factor is getting something more fuel efficient or cheaper to run which will save money over a longer period vs keeping up a not very economical petrol car (7.7L/100km combined but more like 8-9L in reality)

                  Timing belt will cost $800-1,000, brakes I think $250. Mechanic mentioned if I was to sell my car to not worry about the timing belt for now. I also need to fix up some cosmetic things if I can be bothered that's another $200-500.

                  Or maybe sell it (as I need to sell my 2nd car anyways, surprisingly I'll get more for the sedan than I paid for it) and use the combined money to get something better, even if it's not an EV. My estimate of selling both my cars would return me between $8,000 - $13,000, depending on buyers and fluctuating prices.

          • brendanm on 13/01/2024 - 13:37

            @blueyez: No problem with proper Holden's. Barina, Captiva, astra, Vectra, Epica etc are rebadged garbage.

            • blueyez on 13/01/2024 - 13:41

              @brendanm: I was desperate for a car during lockdown, surprisingly bought my car without the inflated second hand car prices. My second car was an inheritance, hence why I'd like to get rid of it. I'm not keen to get another Holden if I had the choice, I'd lean towards Mazda or Toyota if I had to pick another petrol car.

              • brendanm on 13/01/2024 - 13:42

                @blueyez: It came.withouy the inflated price because no one wants the Daewoo Holdens. It's why captivas are 5-10k, and any other 7 seat suv of the same year is $20k+.

                • ThithLord on 15/01/2024 - 10:32

                  @brendanm: I use a Holden Barina 2014 and it has a 5* ANCAP rating, things pretty solid. Only done 100k km though. Definitely not my choice to own it, my partner's parents bought it for her

  • Stewardo on 13/01/2024 - 01:23
    +16

    Keep your petrol car and pay off your debts.

  • hasher22 on 13/01/2024 - 01:26
    +7

    If you don't need a new car, don't get one. Just because you have extra income doesn't mean you should think of ways to spend it on assets that depreciates.

    By all means it's your money but to me, if it ain't broke, don't fix it.

    If you're throwing it all on the mortgage, then put the rest in the offset.

    I'd rather pay off a home faster than buy an depreciating asset.

    • blueyez on 13/01/2024 - 01:27
      +1

      I know common sense would come to that response. Maybe I've been watching too many EV videos lol

      • EightImmortals on 13/01/2024 - 07:27
        -3

        Have you seen the ones where they all catch on fire?

        https://youtu.be/itGeAq9rBeY

        Seriously though as others have said, try and ignore the emotions and impulses leading you to spend money on something you don;t need and pay off all your debt instead. You'll be happier in the long run and once you accomplish that goal your car might actually need replacing and you'll be able to do it without debt. 110,000kms is nothing for most cars.

  • Pcosmic on 13/01/2024 - 01:35
    +1

    Be a seal

    • blueyez on 13/01/2024 - 01:36

      Am getting there lol

    • miwahni on 13/01/2024 - 23:57

      Be a walrus, they're bigger.

  • Drakesy on 13/01/2024 - 01:47
    +1

    At least you're looking at EV's unlike other people

    Honestly the Barina is 16 years old and i feel overdue for an upgrade.

    I'd get a BYD Atto or MG4 and capitalise on the novated lease portion.

    • blueyez on 13/01/2024 - 02:07

      I've never owned a new car, but not sure if FBT exemption alone would warrant pulling the trigger - it is so very tempting!

      • seannami on 13/01/2024 - 09:30
        +1

        I had never owned a new car and was looking at either second hand or a hybrid corolla, preferably ex-demo (technically had only had hand me downs from parents). FBT exemption pushed me, I do not regret in the slightest. I was replacing a 2009 Prius that was may parents'. Friends and colleagues in similar boats have also not regretted going new with FBT exemption, whether they intend to keep it, or to treadmill the EV to other family members and start a new lease at the end.

        I too would go an MG4 (77 or 64 essence would be my choice, I have an Excite ZSEV which is also an option, but it's the lower range end). How long are the "long road trips" you are looking at? Mine can do Melbourne to Bendigo (for example) and (depending on various factors) back either without charging or a coffee break topup somewhere along the way. An MG4 77 could do it without even thinking about it. MG77 could probably do Shepparton and back, but the ZSEV will need a charge at Euroa or somewhere where you can get lunch (I'm looking at road trips for myself, so I've done some planning).

        Having spent a decent amount in both MGs, a Kona EV and having test driven the Atto, I'd go the MG4. That is if you decide to go for it- keeping the Barina is also viable. If the Prius had actually been my car it may have been a harder choice my end as I too had just gotten a mortgage.

        • blueyez on 13/01/2024 - 11:07

          There was FBT exemption on hybrids?! How'd I miss that one =(

          Long road trips in Vic would be 300-500km, but I'd like to venture interstate either to Adelaide or Sydney with charging planned along the way with an EV.

          • seannami on 13/01/2024 - 14:01

            @blueyez: both are 100% doable full EV (gives you some well spaced coffee/lunch breaks too). I spent the morning planning a road trip for myself and my part of Melbourne to Beechworth has a charger every 50kms or so, so no range stress whatsoever- and that trend continues well up to Sydney and even Brisbane. Melb-Adelaide seems a bit less well equipt, but they are on the way. Play around with Plugshare for the kinds of trips you'd want to do. Full EV definitely a better option than PHEV- admittedly I never even considered a PHEV.

            MG77 I'd say is your best bet if you are looking at the cost-effective end of the market :)

    • ssfps on 13/01/2024 - 02:33
      +1

      Do you have any figures to show the TCO and real cost of OP upgrading?

      If his 2007 barina is only around 100,000 k's it's likely got plenty of life left with minimal maintenance. It's hard to believe he would save any money by upgrading even taking novated leasing into account, so it's a matter of how much $$$ is having a newer flasher car worth? Considering he's recently become a home owner at ~6% p.a. interest, that would have to be a really important car upgrade to not throw the money toward paying off his house loan years earlier.

  • Euphemistic on 13/01/2024 - 06:14
    +4

    Keep paying max to the mortgage at least until interest rates come down a few notches.

    Start planning for an EV in the next few years and keep driving the barina with minimal maintenance until it dies. If you can afford to be without a car for a short time at short notice you could even skip the timing belt change and jut hope it won’t blow up. It pretty unlikely to go bang and if you’re prepared to update at short notice you’ll be reward if it does. Only do the timing belt if you need a reliable car and cannot get by without a car. It PROBABLY not worth spending half the value of the car on a timing belt.

    • EightImmortals on 13/01/2024 - 07:29

      This.

    • Muzeeb on 13/01/2024 - 08:12

      2007 barina should have had a new timing belt in 2017 so next one should be 2027. She'll be right mate.

      • blueyez on 13/01/2024 - 11:11

        Not changed yet, according to previous owner. Mechanic has already suggested it, but the feel of the car doesn't seem to have changed whilst driving. Though I'm aware it can be unpredictable with how the timing belt goes.

        I need to get the brakes done more urgently than the belt. I can do both in the coming month. Depends on when the mechanic answers his damn phone lol

        • Muzeeb on 13/01/2024 - 11:17

          but the feel of the car doesn't seem to have changed

          You won't feel any difference. One day you will just hear a bang and rattle rattle rattle. That will be the sound of your valves slapping against your piston tops and your motor dieing for good.

  • holdenmg on 13/01/2024 - 08:01
    +5

    Upgrading the Barina timing belt is cheaper than engine damage.

    • pegaxs on 13/01/2024 - 08:33
      +1

      But it’s a 2007 Barina with over 100k… the cost of changing the timing belt would make the car an economical write off. It would cost more to replace the belt than what the car is worth.

      • holdenmg on 13/01/2024 - 08:38
        +1

        Exactly, Barina is on borrowed time.

        • Euphemistic on 13/01/2024 - 10:43
          +1

          Keep borrowing that time until it dies. It’s not worth changing the belt and it’s not worth getting a new car while trying to smash down your mortgage.

    • blueyez on 13/01/2024 - 11:14

      Yep. I currently have 2 cars (double the Barinas) so maintaining both is a pain. Going to sell the newer one as it's a manual hatch and I prefer my sedan.

      Timing belt will be done after I do the brakes, unless the mechanic has time to do both.

  • solidussnake on 13/01/2024 - 08:23
    +1

    I'm in the same tax bracket and drive the Mrs Yaris 2012 bright custom faded yellow with 212kms on the clock smashing the home loan is a better idea to set yourself up for long term gain

    • blueyez on 13/01/2024 - 11:36

      Long term gain isn't a fun drive lol but yes I get it

  • saltypete on 13/01/2024 - 08:39
    +1

    A month into a Tesla Model Y and it’s very good. But I only bought now because I needed to. Wait 12 months if you can and keep reducing debt. Also prep your house if you are getting electrical work done. Getting 32 amp to your garage will make charging faster if you need daily range, perhaps some circuit to let you use V2L if practical. Solar/battery if you are inclined to go that way.
    Within 12 months the range of EVs available will be much better and there are continuous improvements in range and features. It will give time for the BYD Seal to go to lots of owners and you’ll know more about the car and whether it’s for you.
    Don’t wait too long though. Compared to any modern car the Barina is a death trap. Your health is fundamental to enjoying life and it’s wise to manage risk if you can.

    • kiriakoz on 13/01/2024 - 08:45
      +3

      I’ll never get Tesla. All Tesla drivers on the road look devoid of any life and personality, like they bought their car to finally have something to talk about to their mates.

      • iforgotmysocks on 13/01/2024 - 08:54
        +3

        Ok thanks for letting us know

      • askbargain on 13/01/2024 - 09:03

        I’m guessing you’re one of those with bumper stickers on your car?

        • kiriakoz on 13/01/2024 - 09:15

          I don’t know what that means. I have a 2013 Mazda 3 which I’ve kept in exchange for paying off my home loan in Sydney.

          When it gets to the point of needing to be exchanged, I’ll probably get an EV but not a Tesla.

          I don’t have any bumper stickers, maybe that’s an insult where you’re from. It’s just confusing where I am.

          I’m guessing you have a Tesla?

          • askbargain on 13/01/2024 - 10:41

            @kiriakoz: How else will you show off your personality if not a bumper sticker?

      • Typical16-bitEnjoyer on 13/01/2024 - 10:29
        +1

        Tesla have a weird following like Harleys. They absolutely must tell everyone they have one about it.

      • saltypete on 13/01/2024 - 19:42

        The Teslas, particularly the model Y do look appliance-like. Funnily enough, my personality is such that I feel that no inanimate object is able to compare with me. A car is a thing - and I am so much more than that.
        From what you say a Tesla purchase would cause emotional issues for you and you are probably wise to avoid doing this. Is there a brand that doesn’t give rise to complicated emotions for you?

        • kiriakoz on 13/01/2024 - 19:51

          That’s true, it’s just a car brand but some people (and you may not be one of these people) do need to announce that they have one of the biggest selling car brands in the world. It’s all very well that you act bemused by the whole thing but you must admit there are some Tesla car owners who act like they’re in a cult of some sort.

          Telling me you own a Tesla is like telling me that you just ate a Big Mac.

          • askbargain on 13/01/2024 - 21:28

            @kiriakoz: sounds like you have some trauma you might want to work on

          • saltypete on 13/01/2024 - 21:52

            @kiriakoz: Yes. I worked out many years ago that I don’t give a rats what other people drive and they don’t give a rats about what I drive, or what possessions I have or don’t have. I realise that there are many that identify with and even actually name their car….(a bit sad).
            I have bought a Tesla because it suits my use. In the context of the OPs discussion it seems reasonable to provide that info - but also note that I did not tell OP to buy one.. I guess a couple of years ago a Tesla was something different, but they are currently as common as dirt - or Big Macs..😁
            Was in China late last year and their EV market is much more mature and a LOT more choice. Early days yet.

            • kiriakoz on 13/01/2024 - 21:56
              +1

              @saltypete: enjoy your night mate.

              I look forward to some more choice in the next couple of years when I’m closer to needing an EV. Interesting to hear what you say about the Chinese market. Makes sense due to the population there that they have a much more mature market.

            • Euphemistic on 14/01/2024 - 07:44
              +1

              @saltypete:

              Was in China late last year and their EV market is much more mature and a LOT more choice. Early days yet.

              Yep. The main reason real are ‘selling so well’ in Aus is because it’s been pretty much the only option for an EV. Plenty of people want an EV. They’re willing to buy a Tesla now, but there’s a good chance once the market matures they won’t buy another.

              Although Tesla gimmicks like no wiper stalks and touchscreen glovebox control are possibly going to mean some drivers won’t look elsewhere because it’s what they are used to. Kinda like being stuck with iPhone because you can’t be bothered to learn android.

              • saltypete on 14/01/2024 - 08:05

                @Euphemistic: Yes. In China Teslas are very visibly different to the other EVs and they certainly don’t dominate. Seals - and a couple of other similar options are very common. I hope that this will be the case here in OZ as we change over to renewables.
                I always keep in mind that Tesla are not primarily a car-maker. Cars are a means to an end for them.

                • Euphemistic on 14/01/2024 - 09:05

                  @saltypete: I’m already seeing a lot of BYD Attos. It’s not evidence, but my inherently inaccurate guess is they’re probably outselling Tesla locally.

                  • saltypete on 14/01/2024 - 09:51

                    @Euphemistic: No, Tesla (eCommodore) very big atm. But lots of Attos too. And probably MGs too - but I can’t tell the difference between an EV and ICE just from the looks. The powers that BE in the Middle Kingdom choose to give EVs a nice green number plate..😁

                    I had a good sit in and look at this
                    https://www.hiphi.com/hiphi-y
                    in Shenzen a little while back. I’d be in that like a rat up a drain pipe - and their sports sedan is prime mid life crisis material. If these sort of cars hit OZ it will be crazy..😁

                    • Euphemistic on 14/01/2024 - 11:08

                      @saltypete: I’m still seeing plenty of teslas, but in my anecdotal, semi-observational, car nerd opinion, BYD seems to be becoming more common the Tesla. Few MGs and others but heaps more Attos.

  • kiriakoz on 13/01/2024 - 08:44
    +2

    I’m not going to buy a new car because I don’t drive it enough to impact my life. I commute to work via public transport, if I’m going out on the weekend, I’m typically drinking so I don’t drive either.

    Only places I really drive is grocery shopping on the weekends and visiting parents/mates occasionally for a proper adult dinner with them.

  • dylanando on 13/01/2024 - 09:03
    +2

    youre also supposed to enjoy life, if you can afford it.

    • kiriakoz on 13/01/2024 - 17:17

      That’s a revolutionary concept on ozbargain.

  • Ryk on 13/01/2024 - 09:10
    +1

    keep the Barina
    it may need the timing belt before you get around to it. get it done on schedule. if the belt breaks, and they do, it wipe any value from the car.
    timing belts were a poor engineering decision by the motor industry, many failed and some manufacturers sensibly went back to chains.

  • Eeples on 13/01/2024 - 09:14
    +2

    110km for a 2007 barina is pretty low km. Stick with it until it breaks imo.

    $15900 salary sacrifice on your mortgage, have you thought about another $27500 sacrifice on your Super?

    Regarding packaging your next car… the ozbargain jury is yet to come back in to the room after years of deliberations.
    (If you do decide to package your car; get your own finance and insurance, and don't buy any extras).

    https://www.ozbargain.com.au/search/node/novated%20type%3Afo…

    • EightImmortals on 13/01/2024 - 10:32

      "$15900 salary sacrifice on your mortgage"

      Is that a real thing?

      • Muzeeb on 13/01/2024 - 10:35

        Must work for a 'not for profit'

    • blueyez on 13/01/2024 - 11:21

      I pumped my super for the FHSSS and my employer pays over the minimum superannuation amount. So at the moment not looking to pump up the super any further, plus I accidentally put in too much last financial year grr

      My employer allows us to choose our own finance provider etc for the novated lease

  • shaybisc on 13/01/2024 - 09:46

    Driving a car with a 16 year old timing belt is adventurous. Or has it been changed previously?

    • blueyez on 13/01/2024 - 11:01

      Not changed yet, according to previous owner. Extra adventurous! 😅

      I think it's lived its life as a runaround for the most part. If I'm not doing a road trip, I'm only doing about 60km/week if I'm not driving to work.

      This might actually reduce once I've finished moving, depends how much I can tolerate a further commute via PT to work.

  • blueyez on 13/01/2024 - 13:45

    Edited to throw in a 4th option to the mix

    • Euphemistic on 13/01/2024 - 13:56
      +1

      Sell the one you like least. Keep the other one for another 2 years when you will have knocked over more of the mortgage and there will be far more choice for an EV.

  • Dollar General on 13/01/2024 - 22:04

    Make concessional contributions to your super up to the limit and claim on your tax. Much better than buying a car for financial reasons

    • blueyez on 14/01/2024 - 00:39

      Due to pumping up my super for over 5 years and my current employer paying above minimum contributions, I'm not putting extra into super for now.

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