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0% Camry / 7% Prius -- if I keep it 10 yrs, which is better $-wise?

Discussion in 'Newbie Forum' started by HookedonPrius, Aug 21, 2009.

  1. HookedonPrius

    HookedonPrius New Member

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    (8/26/09 editing original post: Now realize 7% is way too high. More like 5.5 - 3.99%)

    Background: Money is tight. We keep our cars for ten years plus. We will not be trading in our '05 Camry (76,000 miles). We will need to finance 100%. We live in Wis/snow. I've dreamed of a Prius for a long time. After the initial excitement that the 2010 will fit my husband's long legs, I realize we need to make a purchase that is financially wise. We retire in four years.

    We could buy a $22500 2010 Camry at 0% (avail til 9/8).
    ~$375/mo x 60 months = $22500

    We could buy a $26500 2010 Prius III w/Navigation at 7% (edit: I've learned 7% is high)
    ~$525/mo x 60 months = $31500

    $5000 Prius interest plus overall $4000 greater pricetag than a Camry = shelling out $9000 more for the Prius over first 5 years.

    If 15,000 miles per year, the Prius would save us ~$100/month if gas $4/gal. Dealer figured that out.
    I imagine if gas is $3/gal, it would be $75/month saved.

    Over first five years gas might be between $2.50 - 3.50/gal or so, therefore save ~$4800 over five years.

    Thus Camry $22500 pricetag + 4800 more in gas than Prius (27300)
    Prius $26500 pricetag + 5000 loan interest (31500)

    After 5 yr loan, Prius will cost us $4200 more than the Camry.

    If we keep the car ten years...
    ...the 2nd 5 yr period, if gas stays btwn $2.50 - 3.50 gal, Prius will be $600 "cheaper"
    ($4800 savings in gas - $4200 overage)

    With gas at $4/gal, the Prius would be saving us $1800
    ($6000 savings in gas - $4200 overage)

    Over ten years, $1800 doesn't seem like huge savings.






    But now I need your help --
    • Did I figure this out right?
    • Do you think a Prius will last 10 years (150000 miles)? Camry will without question.
    • Also, I realize the brakes may not need changing as often on a Prius, etc., but what other savings might there be that would improve that $1800?
    • Do you still have the relatively expensive interval check-ups with a Prius that we currently have with our current Camry?
     
  2. spitinuri

    spitinuri Member

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    For me it is hard to justify paying 7% interest over no interest. Unless you drive 20K miles or more per year based purely on money I would buy the Camry. It would take too long to recoup the extra money spent on the Prius.

    On the other hand.... if your looking for a cool car and you have the extra money to spend... I would buy the Prius.
     
  3. jestoy7

    jestoy7 New Member

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    I think the math seems right. Oil changes on the Prius must use 0W-20 oil and that is more expensive if you compare it to a standard Camry that can use normal oil.

    However, I'm a firm believer that gas will be higher than $3.50 in the next 5 years and MUCH higher in the 10 year time frame. This would make your cost of ownership for the Prius more attractive.

    The 7% interest is hefty for a new car rate, have you shopped other banks? For example, Bank of America offers a discounted rate for hybrid purchases (not much but 0.25%) or even credit unions in your area.

    Another consideration, is finding a 2009 Prius or a 2009 Camry that you can get for lower cost and yet low miles with warranty, etc... You've got a lot of options.
     
  4. clo2guy

    clo2guy New Member

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    I agree that unless you really want to split hairs, your math is sufficient to make a decent financial decision. I own both a camry and prius (genII) - here's a few of my beliefs.

    1) Regardless of manufacturer stats, I find the Camry much roomier for my 6'4'' frame.
    2) From a performance standpoint (ie get up and go) the Camry wins hands down.
    3) I favor the Prius' hatchback over a trunk.
    4) I favor the quiet ride of the Prius.

    Not to be critical, but if money is tight... there are mush lower cost options for transportation.
     
  5. Paul R. Haller

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    OH my gosh,,, drive a car you want and love vs a car you drive because of price. I can tell you my friend, if you want the Prius, buy one. Otherwise every time you'll get in the Camry and start it up thinking I could of had a Prius. When amortized over 10 years how much is that peace of mind worth?:confused:

    I have learned over the years that the extra paid each month on getting exactly what you want vs what you had to get... just isn't worth it. Be a happy driver, buy what your heart desires, stimulate the economy, and each day as you climb into your Prius there will be a smug smile of satisfaction and a gleeful expression every time you pass a gas station or see another camry. :D However, given the high price of financing you quoted, I'd shop around for a better rate.
    -Paul R. Haller-
     
  6. blackpolish

    blackpolish New Member

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    If you cannot qualify for a better rate than 7% on the Prius, there is no way that you will qualify for the 0% on the Camry.
     
  7. HookedonPrius

    HookedonPrius New Member

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    First of all, thanks for all the responses from everyone. I appreciate all the input.

    We haven't even looked into loans yet. Our credit rating is high, so I don't fear not qualifying for the 0%. I pulled 7% out of the air going by the Build Your Prius on the Toyota site, and going by their info. I have no idea what a good loan rate is. Our financial plan was to get a Prius in the Spring. Then this 0% Camry came to our attention a couple days ago.
     
  8. justlurkin

    justlurkin Señor Member

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    Personally, I don't believe in financing for a car-- I see no reason to pay anything extra over the cash value of the new car, year-over-year, for a continually-depreciating asset.

    In your case, the Camry would be the right choice since the 0% financing means you are not paying extra for a depreciating asset. Essentially you are paying cash value for the new car, spread out over 5 years.

    While I like buying new cars because buying used means a greater chance you are buying someone else's problem, many also believe buying a 1-2-year-old car is a smart move because you are letting someone else take the biggest depreciation hit. So you might want to consider a used Prius between '07-09, which might be an even better deal than a brand-new Camry at 0% financing.

    Hope this helps.
     
  9. HookedonPrius

    HookedonPrius New Member

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    As I said in previous post, I came up with 7% from Build your Prius site. So today I did some calling. Our bank gives a 5.75% with .5% reduction for Green car, but 2010 Prius doesn't qualify because they don't yet have the emission report yet (!?!?!?!)

    I saw in another post mention of Pen Fed loan, so I called as we would qualify to be a member, and that would be 3.99% (sounds too good to be true).

    If Pen Fed is "true", their rate would bring the interest down from $5000/7%, down to $2780/3.99% interest.

    That saves $2220 in interest payments, and creates a better overall savings of $4020 (per my original posting)

    Makes me feels so much better! I immediatelly felt a spontaneous smile break over my face!

    As Paul Haller said in his post: "I can tell you my friend, if you want the Prius, buy one. Otherwise every time you'll get in the Camry and start it up thinking I could of had a Prius. "
     
  10. HookedonPrius

    HookedonPrius New Member

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    I agree with that thinking. We always bought used. '05 Camry was first new one, cash. So I agree with having someone else take that depreciation.

    Unfortunately, my long-legged, 6'4" husband couldn't fit into the previous Prius models. 2010 was finally roomy for him in the driver's seat. And from what I have seen, the used Prius prices aren't all that much "cheaper". That was one route we were going to take, waiting a few years and buy a used 2010.

    I guess we really don't "need" a new car, having the '05 Camry. But became quite focused on Prius once the 2010 came out.
     
  11. pdhenry

    pdhenry It's HEEERE!

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    The math on the monthly gas savings looks suspect. 15,000 miles at 50 mpg is 300 gallons; at $4/gallon it's $1200. So a Camry would have to burn twice as much gas to save $100 per month. Does a Camry only get 25 mpg??
     
  12. HookedonPrius

    HookedonPrius New Member

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    Camry reportedly gets "33 mpg highway, 22 mpg city and 26 mpg combined." I told the dealer who figured it for me to round the Camry number to 25mpg combined and to put Prius at 50mpg combined for simplicity (knowing we might get a bit better on either)
     
  13. SilverPriusIII

    SilverPriusIII New Member

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    If I was you, I will wait a few months after the Cash for Clunker deal is over. C4C has made inventory of Prius very low. When there is more supplies, you can get a better deal. Depends on the model, you can get more than $1000 off MSRP.
     
  14. werewolf34

    werewolf34 New Member

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    You seem like a very rational buyer. Camry is the rational choice (with the 4 cylinder engine)
     
  15. justlurkin

    justlurkin Señor Member

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    Hmm.. Is there that much difference in the front seat legroom between the 2nd-gen and 3rd-gen..? Aside from the front seats with more adjustable options in some of the 3rd gen, I thought the interior dimensions differ by a matter of fraction of inches.
     
  16. Midpack

    Midpack Member

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    You can buy a Prius for quite a bit less, since you seem to be comparing to a very basic Camry. We have am 07 Camry Hybrid and love it, but if you want lowest cost of ownership, the TCH won't fit your needs.
     
  17. The Electric Me

    The Electric Me Go Speed Go!

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    I realize your situation is unique. Approaching retirement probably makes a big difference. However no offense, but people go through elaborate means to either justify a purchase or negate a purchase or make a decision about a purchase. Well, your name is "HookedonPrius" and you say you've been dreaming about a Prius for a long time.

    To me, that would be important. Sometimes I think people when it comes to car purchases drift away from "what they want". The 2010 Prius is one of the hottest selling cars right now, so unfortunately no big deals on them. It's hard to justify the purchase of The Prius if you are looking only at the economics of purchase.

    But if you've always wanted a Prius? You've already owned and own a Camry. It really boils down to what you want. If the economics were a deal breaker, you wouldn't even have to ask.

    My personal opinion is IF you can afford it, get what you want. You may love the Camry, but if you've always wanted a Prius, everytime you see one you will be second guessing yourself. If you are keeping your 05 Camry, you then have the best of both worlds. An 05 Camry with only 76,000 miles still has plenty of life in it, assuming you maintained it reasonably well.

    So I'm voting go with what you want, even at an economic penalty. My only warning would be since your husband is so tall, make sure to take a long, long test drive, and/or have him sit in The Prius for a period of time. Some people have had real problems with back pain over long periods with the seats. It may sound strange, but I'd ask the dealership if he could sit in the front seat for 1/2 hour or longer.

    I'd go Prius, but my only warning would be make sure it's comfortable for you both.
     
  18. SageBrush

    SageBrush Senior Member

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    • PenFed is real. *Excellent credit Union*
    • If money is tight, why are you sticking to a 10 year car replacement program if your current car(s) are OK ?
    • Will you require 2 cars in retirement ??
    • Prius pricing tends to move with fuel prices, but will go down next year if fuel is not much more expensive.
     
  19. richard schumacher

    richard schumacher shortbus driver

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    The lowest-cost solution is to buy a clean used car. No matter whether you buy new or used, pay cash. Don't borrow money for a car, especially not for a new car. Save up for it.
     
  20. HookedonPrius

    HookedonPrius New Member

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    Money isn't tight, tight. We don't worry about paying our bills. I quit my job 5 yrs ago to take care of aging parents so harder to save like we used to.

    I said we keep our cars 10 years plus. We have two 97's, one 98 and our 05. All Camry's (two adult children drive our higher mileage Camry's) Our thought is we'll "sell-give" our '05 Camry to our son when we retire in 5 yrs. If we get a new car now, in the next 5 yrs we won't be adding too many more miles onto 05's current 76,000.

    Would we need a second car once retired? Good question. Which leads to my original question: Do you need a second car if you have a Prius? Does this thing ride well in Wisconsin winters??

    I guess I would just like a Prius. I like the safety features of the current Prius. My husband seems to fit in it so much better. Waiting to buy a used 2010 might be an option, but from what I have seen, the price is almost the same as new when buying a 2 yr old low mileage Prius.

    We'd like a Prius III with Navigation solely for the back-up camera. I don't like the rear window without one, and I know I'd regret not going with it. An option I've been told is having dealer install rearview mirror with a back-up screen in it. About $900 plus, and skip the Navigation pkg. Then we could get a 2010 II.

    Doesnt matter to my husband: new 0% Camry, new 3.99% Prius or keep ol' Betsy awhile longer: thus the reason for my other question: will this Prius us last ten plus years like a Camry???