My insurance check finally came in for my stolen car. Since my rental car expires tomorrow, Matt and I went shopping for a new car* last night.
Before we jumped into the shark tank of car dealerships, we attempted to arm ourselves with some research. I narrowed my choice down to four cars: Honda Fit Sport, Prius, Toyota Yaris, and Scion xD.
This process reminded me of wedding planning. Whenever I needed to compare things (like wedding venues), I would create a matrix. I would put the qualities that mattered to me down the left side and my options across the top. In this case, my categories were things like "environmental impact" and "cost", and my four car choices were across the top. Seeing all the information in relation to each other really helps me make a decision.
I rarely find that something is a perfect choice. Instead, I find myself trying to weigh the benefits and the drawbacks of each option and trying to see how it stacks up against the other options. For example, the B&B we ended up choosing for the reception had a lot of drawbacks: it couldn't fit all of our guests overnight, the cabins were really rustic, and it was situated right on a major highway. However, there were amazing benefits that outweighed the drawbacks (e.g., innkeepers who would go out of their way to help us, a very reasonable cost, the freedom to do whatever we wanted with the place, etc.).
P.S. This matrix is still blank because I ended up finding an electronic version of it Edmunds.
P.P.S. I think I'm going to get the Honda Fit Sport. It's not as environmentally friendly as the Prius, but it doesn't cost as much either. Plus, I love how airy and open it is inside, and it's a small car with an amazing capacity for seat reconfiguration, which creates tons of cargo space. The Scion xD surprisingly pumps a lot of pollution into the air, and the Yaris is nice but it kind of seems like a lesser version of the Honda Fit (although I do love Toyotas...).
This whole stolen car fiasco is another reason I am so thankful we didn't go into debt to host a wedding. Luckily we've been building our savings over the past six months and we might be able to pay for the car in cash (since we have the insurance money, as well). The idea of paying lots of money in interest is not very appealing, so I'd like to avoid taking out a loan if possible.
However, we'll have to wait and see how our tax situation works out this year. I rolled all of my retirement into a Roth IRA this year, so I'll have to pay a butt-load of taxes on that. Plus, I'm a self-employed consultant, so almost half my income goes toward taxes. However, we bought a house this year which should help, and we also get an interest free loan from the government (up to $7,500) because we bought a house between April 9, 2008 and July 1, 2009. So who knows. I don't know if we'll owe a ton of money, get a lot back, or break even.
*CAVEAT: Every financial book I have ever read says you should buy a used car because cars are depreciating assets. Plus, they are way better for the environment because so much energy goes into the production of new cars. However, I want a car that will last me for the next ten years, and it's easier for me to trust that a new car will fit that bill. Also, there are significant improvements to the 2009 that are very appealing.