More specifically, Terry and I have just purchased a 2011 Toyota Auris Hybrid to replace the 1995 Nissan Micra that I’ve been driving since I got my UK driving license last year. I can actually hear you thinking ‘but aren’t you not spending any money this year?’ – and you’re right, I’ve decided not to spend money for a year, but I will explain why we made this decision.
Originally, I had hoped to work at a school that I could take public transport to as I hadn’t driven at all for the first 18 months I lived in England and I liked it that way. Then I got my current job at a school that there was no reasonably convenient public transportation to and needed to get a UK license. My US license was only valid for my first 12 months in the country so I had to pass a new UK driving test – which was not a pleasant discovery. When I knew I had to take the driving test, I intended to learn how to drive a stick shift and pass my UK driving test in that as that’s the norm over here. I only had 6 weeks to learn a stick and pass a driving test – remember how strict and horrible they are about EVERYTHING?!! I was working 80 hour weeks student teaching and I was not going to pass the test in a stick shift, so we decided to just buy me an automatic and take the test in that. So we bought the Nissan Micra – a notoriously reliable care – from a family friend for £475 cash and I passed the test a week later in that.
It is an older car and we expected some problems, sure it’s died a few times but we bought some jumper cables for those occasions. Then, last fall, I discovered that the car leaked from the sunroof. Not a little, but enough to flood the passenger footwell and the passenger seat. The leak would cost more to fix than we paid for the car, so repairing it was out of the question. Terry duct taped some plastic sheeting to the top – in case people couldn’t tell we didn’t make much money, this was a public service announcement to that fact – and it has actually popped on one occasion, leaving the plastic sheeting literally flying behind my car as I drove to work. Mostly, it was effective and the car only minimally leaks now.
When we decided to tackle our debt, we talked about keeping the Micra for at least another academic year until we could afford a good sized down payment on a more reliable car – or, ideally, pay cash for it. Then, while bored at home, I started looking up Hybrids, which is what I had hoped to buy when we could afford it. I found the Toyota Auris and fell in love. This was the car I wanted. We found a 2011 Toyota Auris with 54,000 miles locally being sold for £7795 – the cheapest option, but still a huge chunk of change. Terry and I calculated that we could make a £550 down payment – which is what I have managed to save since we started the year of no spending – but we would need to take out £7000 to buy the car. Taking on debt is not ideal, however I am in a situation where I need to build my credit in the new country that I live in, which further complicates matters. To do this, you need debt. My US credit is really good, however UK creditors don’t take that into account. Terry and I discussed whether it was worth it to take out this loan to build my credit and pay it off early in order to build my nonexistent credit and decided to apply for a loan to see if I could get it. Obviously I was successful.
We arranged to see the car last week and I loved it. I managed to lower the price to £7550 through my excellent haggling skills – thanks, Peace Corps! – and we bought the car. We picked it up on Tuesday and I got to drive it to work on Wednesday – the first day of school.
We did take on more debt to get this car, however, the amount of money it’s saving me on gas – I used to have to gas my car once every 3 days! – pays over half of the monthly car payment and the remainder of the car payment is coming out of the raise that I received this school year, which had originally been earmarked for savings for a new car. So the car payment won’t actually affect our originally debt repayments in any way, which is how we were comfortable making the decision to buy the car in the first place.
Could I have continued to drive the Micra? Of course, but I would have had to continue paying £270 a month in gas to do so, money which is now helping us pay for a more reliable, fuel efficient car. Should we have added to our already large amount of personal debt? Ideally not, but the loan is helping me to build my UK credit so that we can get a reasonable mortgage one day, which is one of the reasons why we want to pay off all of this debt in the first place. It is a huge decision that Terry and I discussed at length. I can tell you that I am sleeping really well not having to worry whether or not my car will start in the morning and knowing that there won’t be a pool of water in there if it rains a lot the night before. I also know that this winter, I won’t have to stop and gas my car in the freezing cold every THREE DAYS. Most importantly, I know that I can afford to make these payments and that by doing so, I am helping Terry and I to build the future that we really want.