We traded in our car – update


Several weeks back I announced that we wanted to sell our car to increase our success rate or retiring early. By doing so we would gain some profit and were able to save more money each and every month. And as the guys from Dividend Diplomats would say: Every dollar counts.

In the past weeks we’ve made some progress on this, so I figured it was time to share an update with you guys. And let you all know how much money we would save by doing this.

To become financial independent, earning more money than you spend is crucial. You can achieve this by increasing you pay or side hustles, or decrease your expenses. Ideally it would be a mix of both. At the start of this blog we set a goal for ourselves to increase our savings rate, the metric we use to track our high income / low spending balance. Although we set a solid number, an average of 30%, managing to climb higher even sooner would be for the better.

So I started thinking about possible actions with big impact. One of them was selling our car. By selling our car we wanted to reduce our spending big time. We planned to use part of the profit to buy back a used car. And stash the ‘leftover’ money in our portfolio. 

The first thing we did, was listing our car for sale at an online trader. We got a few reaction from potential buyers, but none were really converting into a sale. We didn’t want to wait weeks or months in order to sell. We still had to keep paying taxes and insurance. And even worse, the longer we drove with it the bigger the chance was we had to pay up for some big maintenance. So we changed our how and accelerated our plan by already buying a ‘new’ (used) car. You might think it’s crazy to buy a different car before you’ve sold the old one. But it’s actually the best thing we’ve done!

Because we missed out on the money from the sale, we bought our next car as cheap as possible. Which resulted in the beautiful Opel Corsa you see below, for only 1200 euro.

Schermafbeelding 2016-11-12 om 17.38.53.png

From Audi A5 to a Opel Corsa

We brought our Audi to the garage owned by my brother-in-law, who would sell the car for us. We then suspend our ownership on the car. This means we’re technically still the owner in name, but we claim not to drive it and suspend our payments for insurance and taxes.

By doing this we fast forwarded to the new situation, were we have lower monthly costs and already start saving more money every month. In the meantime we have no hurry to sell the Audi. But when we do, we split the profit into 25% for savings and 75% for investing. We aim to make at least 13.000 euro of ‘profit’, which would boost our portfolio worth big time.

And what about the numbers?

Of course we do all this to increase our savings ratio. And by doing so, having more money ‘left’ every month to use for either saving or investing. An additional benefit is that we also need less passive income to cover our expenses. Therefore will reach financial independence rather sooner than later.

Below I made a statement providing the costs of the Audi next to the Opel. These represent the yearly costs, expected maintenance and devaluation. We measure it over a year’s time because we also want to look at maintenance costs and devaluation. (Within the quotations I stated the monthly costs)

Audi Opel
Total  4596.40  € 1796.20
Taxes € 744  (62) € 300 (25)
Insurance €  1082.40 (90.20)  € 196.20 (16.35)
Gas € 1320 (110) € 840 (70)
Maintenance € 450 € 150
Devaluation € 1000,- € 400


Wow… Looking up on the numbers always gives a clear image on what something is really costing you. Per year we save 60% of the money we would otherwise pay for owning and using a car. Or at least €2800 per year. Excluding the devaluation, we can send €2400 more every year towards investing. 

On a monthly basis our wallet can keep 111.35 based on the core expenses (tax, insurance and gas).  

Something I’ve seen with other bloggers is the calculation of how much money we would have to invest to ‘earn’ our savings if we wanted to achieve the same by receiving dividends through DGI (Dividend Growth Investing)

So here it goes. In order to receive €111.35 in dividends we would have to invest €3711.50, taking into account a dividend yield of 3%. That’s even more than the €2800 euro we save per year by doing this. Bam!

It’s just amazing (and quite shocking, honestly) too see the amount of money we actually paid for a owning this car the past few years. And how much it can save you if you drive something way cheaper.  

And the best part:

We’re driving this little Opel around now for a week. And we get lots more joy from it than driving in that freaking Audi! We only have to think of the lifestyle we are pursuing and the possibilities it will provide us on the long term. It’s instant happiness. 


15 thoughts on “We traded in our car – update

  1. Wow, you just made me smile and cry at the same time! Smile, because this a very good move and I’m seriously impressed with the dedication.
    Cry because, well, you’ve traded a A5 for a Corsa……as a car enthusiast that just hurts 😉
    Good luck with your journey to FI, no doubt in my mind that with such dedication you will definitely get there!.


    • It was not as easy as we thought. We had the same emotions the past weeks. It was really (and i mean really really) hard to give up on the Audi. But we also knew that if we wanted to make some big steps on short term, this was for the best.


      • I can believe that! Still, you will end up in a better position in the future. You will enjoy that for many decades to come, that Audi will be out of your mind by then (or at least it won’t make you as sad).


  2. Wow congratulations on the trade in! You sure are saving a lot of money now haha especially on the insurance. I’m not a car guy and never understood why people would get expensive cars. They depreciate fast, have high upkeep, and will probably get you speeding tickets.

    By the way, I’ve never heard of the Opel brand before haha! Apparently it’s a subsidiary of GM.


    • Thanks, the savings on insurance are massive. Imagine that when we bought the car (4 years ago) the insurance was even 30 euro’s higher…(and we got only 1 speeding ticket:)) Although we made this choice we can still appreciate expensive cars. But no longer think it’s worth the money.


  3. That Audi really burned some cash. From the savings you can buy two Opels per year 🙂 Just out of curiosity: how did your friends, family, colleagues reacted when they saw you with your new car?


    • It really does indeed. We never knew exactly how much until know.

      Friends and family show some mixed reactions. Some think we are crazy and made a big mistake, others take it more lightly. But it definitely raised a lot of eyebrows. Most understand when we explain our motives though.


  4. Haha! What an upgrade, that’s for sure. But you did the right thing and you should be proud that you took the right long term decision for your finances. Good job! I hope you get a long and happy life out of your new (old) car!



  5. Great move that truly shows your dedication to the journey you’re on!

    I wonder how your acquaintances responded to the change in car. No one worried that you got fired or needed money to fuel your addiction? 😉

    Any way, I got here because of your other post about the new job. Wishing you the best of luck!


  6. Pingback: What cars have you driven? - Cheesy Finance

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