Yahoo Finance 5 Reasons Retirees Regret Selling Their Cars in Retirement
Retirement is a time when many people look for ways to downsize or cut costs on things they don’t feel like they need anymore. While this can often work out, it’s possible to take this too far and sell something that should have been kept — like a fully paid off car.
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Of course, there are valid reasons to sell your cars in retirement. If you need to get rid of an extra vehicle, you can free up space and earn some extra cash. If you still have an auto loan payment or an expensive insurance premium, selling could ease the load there, too.
But selling your car isn’t always the right decision. Here are the top reasons why retirees regret the decision to sell, according to experts.
Also, here are seven of the best cars for retirees on budgets.
Limits Mobility
Unless you live somewhere with excellent public transportation or you have someone who’s willing to drive you around whenever you need, selling your car can seriously limit your mobility.
“Selling your car means giving up freedom. Even if you believe you have alternative means of transportation covered, it’s not the same as having your own car,” said Melanie Musson, a finance expert at InsuranceProviders.com.
You might not always be able to rely on other modes of transportation to get you where you need to be on your time frame. But when you have your own car, you’re a lot more free to do what you want.
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Harder To Get to Appointments
Retirees who end up having to go to a lot of medical appointments often regret selling, too.
“Getting to regular check-ups or handling unexpected health issues becomes more challenging, especially in areas with limited public transportation,” said Alec Kellzi, CPA at IRS Extension Online.
Without a reliable vehicle, trying to find someone who can get you to your destination on time — or trying to schedule your appointments around public transportation — can be stressful. And if an emergency arises and you don’t have time to coordinate with someone else, not having a vehicle can become a serious issue.
Minimal Benefits
Depending on the vehicle’s condition, make, model, and mileage, you could get some money by selling. But some used cars don’t go for much, so selling might not justify the minimal gains.
Not only that, but if you’re trying to get rid of your car so you qualify for systems like Medicaid, know that it won’t necessarily be all that helpful.
“A car is an asset that won’t hurt you. You can qualify for Medicaid and other public assistance programs even if you own a house and a car,” said Musson. “Other assets could hinder you, but those two won’t. If you sell a car, you’re getting rid of one of the only assets that won’t hurt your eligibility.”
Can Be Isolating or Strain Social Relationships
Without a vehicle, many retirees end up staying home more often. This can be quite isolating for those who would have otherwise participated in community events or social gatherings with friends and family.
Not only that but not having a vehicle could make it harder to help out with the grandchildren or elderly parents, Kellzi said.
Unexpected Costs
Ideally, retirement means cutting back on expenses. But while getting rid of a car can eliminate some expenses — like insurance, maintenance, or fuel — not everyone’s prepared for the new costs that crop up.
“While car ownership expenses disappear, alternatives like frequent taxis or ride-shares can become unexpectedly expensive,” said Kellzi.
Alternatives to Selling a Vehicle
If you know you’re not going to drive once you retire, perhaps because of personal or medical reasons, then selling could make sense. Otherwise, you may want to consider an alternative like:
Downsize your vehicles. “Trading for a smaller, more fuel-efficient model can significantly reduce running costs,” said Kellzi. “Couples can also downsize from two cars to one.”
Change your car insurance. “If you’re only driving occasionally or not at all, you can opt for liability-only coverage,” said Musson. “That could save you $500 or more a year.”
Rent out your vehicle. “You could use a peer rental program to rent your vehicle out and earn passive income,” said Musson. This is also a great way to keep busy in retirement since you’ll still need to coordinate with people who want to rent your car and keep your vehicle clean between renters.
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This article originally appeared on GOBankingRates.com: 5 Reasons Retirees Regret Selling Their Cars in Retirement
