I bought Edward, my 2004 Pontiac Vibe, the summer before my senior year of college. Nick and I finished paying him off about two years ago, and like most people- this car was the first thing that I officially owned!!
Edward has gotten into two fender-benders over the past 6 years, and the first one got us a new bumper and a little cosmetic work to the frame. Other than that, we have had no problems with the car and have done our regular maintenance and drove our 8 hour trip to Long Island and Watertown usually 4-5 times a year. He is now sitting with roughly 132,000 miles and a heater we sometimes need to hit to get it to work :/
Last month, while commuting home, a driver of a SUV decide to make a U-Turn in rush hour traffic right in front of Edward! Nick was amazing and swerved to the left so that the car was only hit on the wheel well of the rear passenger side of the car; otherwise we would have been T-boned on the passenger side- aka where I was sitting. Thanks Nick!!
We are lucky that the car is still drivable car and what looks to be only cosmetic damage was done to the car. The other driver took full blame and there insurance was willing to pay for all damages. So we brought the car in for an appraisal and took home a rental car.
The next part of this story can be summed up with one quick analogy: you go into the dentist for a cleaning and they tell you you’ll need a root canal or better yet, a new set of teeth :(
Our Insurance Company called to tell us, our car had been TOTALED :(
Mind you, when Nick and I dropped the car off, it was driving fine and really just needed some cosmetic work on the rear wheel well, so this came as a bit of a shock!! We soon learned that "Totaled" for an insurance company equals the repairs adding up to more than 75% of the value of the car.
We were left with two choices, either we get the Kelly Blue Book value for the car now and our Insurance Company buys the car off us
Take roughly $1,000 less and keep the car, but it will be labeled as "Totaled," and we will need to get a new title for the car and re-do our inspection. This will also mean that we will be accepting the final payout for our car.
So Nick and I had to make a hard decision and figure out financially what was the better option. If we sold the car we would get more money for it, but we would need to add a car payment to our budget. If we took the smaller check, we get less money for the car but hopefully get to keep Edward for another year or two before we need to start looking for a car, which would also means less student loan debt and hopefully more wiggle room to add a car payment into the budget.
So, needless to say we went with the smaller check. Our final rational really ended up being that we didn't plan on making money on this car to begin with. We planned on driving Edward until the repairs were worth more than the car, so we think we made out well. Plus, I like Edward and want to keep him around for a while longer!!
Financial decisions with emotional undertones are hard, but really laying out the pros and cons of this decision helped us come to a conclusion we are happy with. We will need to spend a little money on car cosmetics, but the rest can go into savings or the stock market to hopefully make us money until we need it to buy a new car.