I’m an Average Middle-Class Retiree: 7 Ways I Cut Costs Driving a Used Car
Written by
Laura Beck
Edited by
Levi Leidy
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When it comes to saving money in retirement, Therese R. has it down to an art form. While still living comfortably, the 67-year-old retiree closely watches her spending to make her savings last — starting with keeping car costs as low as possible. By driving a used vehicle, Therese has found smart ways to cut costs at every turn.
Here are the ways an average middle-class retiree cuts costs by driving a used car.
Never Pay Sticker Price
“The very first rule is never paying sticker price when you buy a used car from a dealer,” Therese said. “Take the listed price with a huge grain of salt, and get ready to play hardball.”
She suggests checking pricing guides for the model’s market value before negotiations, and being ready to walk away to get a fair price. On her last used car purchase in 2019, Therese said she knocked $4,000 off the original asking price.
Buy Used Cars That Are 2-3 Years Old
Therese has found the sweet spot for value to be purchasing two- to three-year-old used cars from dealerships. “You save a ton over buying new, but it’s not so old that you’re at major risk of endless repairs,” she said. “The savings over buying new can be 40%-50%.”
Do All Routine Service Yourself
To keep maintenance costs down over years of ownership, the hands-on retiree takes a DIY approach to oil changes, fluid top-offs, air filters and other basic services.
“I have a decent tools and do absolutely everything myself that doesn’t require a lift or too much strength,” she shared. “Those small service costs can really add up over time.”
Take Advantage of Senior Discounts
At parts stores and some service centers, Therese said her senior citizen status helps her score valuable discounts on auto parts and labor costs.
“It’s always worth asking if they offer any senior rates or discounts. Many will knock 10%-15% off for folks my age, which can add up on a bigger repair job,” she said.
Maintain a High Credit Score
One of the most important ways Therese keeps auto costs down is by maintaining a high credit score through responsible borrowing. This allows her to qualify for low interest rates when financing the purchase of her used vehicles.
“I had an 820 credit score last time I bought, which let me get a 3% interest rate on my auto loan,” she said. “Over the life of a four-year loan, that probably saved me well over $1,000 compared to a higher rate.”
Only Finance for 3 Years Max
While many buyers take out five- to six-year loans, Therese said she strictly limits her financing terms to three years maximum to avoid excessive interest costs.
“The longer you finance a used car, the more you pay in total interest charges,” she said. “Capping it at three years keeps costs reasonable and prevents going upside down on the loan due to depreciation.”
Use Cash-Back Apps and Gas Rewards
Finally, Therese squeezes out additional savings on the operating costs of her used vehicles through cash back apps like Upside and Checkout 51. She also makes sure to leverage grocery store rewards programs to save $0.20-$0.40 per gallon on gas fill-ups.
“It takes a little extra effort to claim the cash-back offers and stack gas rewards,” she said. “But it can easily save me $300-plus per year just for staying on top of it.”
Through diligent cost control measures, Therese is able to keep her vehicle expenses as low as $2,500-$3,000 per year all-in. Those savings help her retirement income stretch further, leaving more for traveling, hobbies and ensuring she never runs out of money down the road.
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