GhostGT
Daemon Poster
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- 1,019
Lets say you drive 650 miles a week, which is very common for a commuter living in my city. You get 30 miles per gallon, meaning it would take you 22+ gallons to drive every week. In Canada, 22 gallons of gas would be 100 litres. At $1.20 per litre, thats 120$ worth of gas weekly, which equates to $6,200 per year worth of gas.
Now, you can see where the savings are. I based the distance on driving Hamilton to Toronto daily (as well as a small activity), and a fuel efficient SUV.
Count insurance rates for the new car and you're right back where you started from. In 90% of all cases, it simply does not make sense to purchase a new car to save money. On the other hand, replacing an SUV with a Prius might make sense (but I'd still rather drive my car rather than a Hybrid.)