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Old 01-17-2013, 07:09 AM   #13
kam327's Avatar
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Originally Posted by Bolto View Post
If fuel economy is your primary goal, I would just look at a hybrid. Switching cars to get 50% improvement in fuel economy may not make financial sense, but at least a 100% improvement could make the math work.

A Prius C would give you the best numbers, mileage and price wise, if your main goal is to minimize fuel costs. A C-Max or Fusion hybrid would be much better driving cars, but they also cost a bit more, so it depends on what you want.
Trouble is, trading in a perfectly usable car for a new hybrid just to get better fuel economy is usually folly. At 1,000 miles a month and $3.50 per gallon, you're saving only $87.50 a month in gas by doubling your fuel economy from 20mpg to 40mpg. If your increase in payments (and decrease in expected maintenance / repairs) by buying the new hybrid is significantly less than $87.50 a month then it may make sense. But with hybrid prices where they are, that seems unlikely. Especially if you're currently driving a paid off vehicle, or will be paid off within the next year or two.

But then there are other considerations like new car itch, enjoyment factor, future repairs (higher on the older car), etc.

When trying to decide whether to refinance or trade in my wife's '08 Taurus in order to drastically reduce the $420 a month payment, I did this quick tradeoff calc at the end of 6 years. It looked at refinancing the Taurus for another 36 mos. to reduce the payments or trade it in on the Focus. Factoring in gas savings and the Taurus needing new tires soon, it was basically break even. But that's assuming the Taurus needed no major out of pocket repairs over the next 6 years which was unlikely. Also required a swag on book value of each car at the end of 6 years. Given those two unknowns, I may very well have been better off keeping the Taurus. But then there's the intangible driving enjoyment factor....

But basically if you're looking to reduce the pain to your pocket book, don't just look at gas savings. Look at the big picture!
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