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This is not one of those, it’s too good to be true scenarios. You really can get a car for free (or nearly so) thanks to our leaders in Washington. I guess it won’t be quite for free because our tax dollars are going to cover the cost of the actual car and then there is also a question of shipping costs that need to be addressed.

In October of 2008 Congress passed the Emergency Economic Stabilization Act. More commonly referred to as TARP it was primarily intended to allow the government to buy troubled assets in an effort to stabilize the financial markets.

However, a little know aspect of this Act also provided funds to promote the purchase of Qualified Plug-In Electric Vehicles. Before you head off to buy a Tesla for $100,000 understand that this credit is not for just any electric car, it is for what they refer to as NEV or Neighborhood Electric Vehicles. I’d call them golf carts.

But still, a golf cart for free is nothing to sneeze at. You can’t get much more frugal than a new car golf cart for free!

photo by jdanvers

To take advantage of this deal you are going to have to front the money for a few months. The government, as nice as they are, is not simply going to ship you a golf cart. You must buy it first; in fact you must buy it by the end of this month! What’s interesting though is that while you must buy it, it may not be delivered for several weeks. Buy hey, the IRS is willing to work with you as long as the manufacturer gives you the serial number and Manufacturer’s Statement of Origin.

(Here is more detail from the IRS Notice 2009-54)

Depending on the specifications of the vehicle you can get from $2500 all the way up to, it would appear, nearly $6,500 in tax credits.

While I call these golf carts they are really more than that. They feature seat-belts, a full set of lights, and even rear view mirrors. Though you may purchase a plain Jane style cart there is nothing stopping you from pimping your ride. Take a look at this article from Wired Magazine for inspiration.

How’s that for putting our taxes to work?

What do you think of this program, is the government making good use of our money?

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photo by fiskfisk

Taken from an advertisement in the Wall Street Journal today:

When even one plane crashes, the story is in the headlines for weeks. But the equivalent of 12 planes full of teens dying every year is barely a blip on the national radar.

Support the STANDUP act (H.R. 1895) creates a National Graduated Driver Licensing (GDL) law that would give teens on-the-road experience gradually while helping them avoid risky conditions. In reduces in-car distractions like texting, limits nighttime driving and the number of friends in the car, and increases the required hours of training and supervision.

When states have implemented comprehensive GDL programs, the number of fatal crashes among 16-year-old drivers has fallen by almost 40%

Part of what made this ad from Allstate insurance catch my attention is the fact that I am the parent of a young teen. We are just a few short years from our first driver with another following not far behind. As a parent I want my children to experience life, make mistakes and learn from them. I honestly believe it is better to break an arm trying than to have never tried. But there is a limit to the number and extent of risks I am willing to take or allow my children to take.

I fully plan on having a number of rules about when they can drive and who they can drive with. My children will be expected to contribute to the expense of owning and operating our family vehicle. But even with all the rules I put in place, my children will still be on the same roads as kids that don’t have parents who make sound choices.

Additionally, even with a community of good parents, some kids will make rash decisions.

My parents did everything in their power to provide good guidance. I took drivers education, had my permit the day I was eligible and drove with my parents in the passenger seat for months before getting my license. But no sooner than I had my license in my pocket did I find an excuse to get out from under my parents watchful eyes. I did doughnuts in the cul-de-sacs, I spun tires from the stop lights and I refused to let any car pass me.

I am not naive enough to believe that any GDL program will prevent my kids or any others from making stupid decisions. But I also know that as I gained experience behind the wheel I continued to make better choices.

The STANDUP act provisions include:

Learner’s permit stage:

• Minimum entry age of 16
• Minimum holding period of 6 months
• Minimum of 30-50 hours of supervision
• Ban on non-emergency use of electronic communication devices

Intermediate stage:

• Minimum of 16 years, 6 months for a “provisional” or restricted drivers license
• Nighttime driving restriction
• Passenger restriction
• Ban on non-emergency use of electronic communication devices

Unrestricted stage:

• Minimum age of 18 years for an unrestricted drivers license

The only thing I would like to see different is a waiver for 16-18 year olds that are working after dark being allowed to drive from work to home.

Please encourage your members of congress to support the STANDUP Act (H.R. 1895) by writing to congress.

For more information please check out www.saferoads4teens.org

photo by emilio labrador

Profit margins on car sales have fallen over the last several decades and dealers will likely continue to face ever narrowing margins considering newer business models like Saturn and Scion’s one price approach. These dealers are forced to selling cars at a fixed price that limits profitability.

Traditional dealers have also faced diminishing margins and look to add other products and services to make up the difference.

We are all being sold at every turn: “want a cherry pie with that hamburger?”, “interested in an extended warranty with this television?”, “how about Office Pro with your new PC?” Dealer are often no different, from the moment you arrive they are thinking about how to up-sell you.

Things to avoid:

• Pinstripe – 3M sells rolls of pinstripe that will cover 10-15 cars for less than $30 retail. It takes an experienced person less than 10 minutes to install but some dealers will charge $175 or more!
• Rust proofing – Years ago this was common and some would say necessary. Cars have changed, the metal if often treated chemically, technology has improved and rusting is just not the concern it once was. I’m not sure of current costs. It used to be less than $30 in material cost for the dealer about a half hour to install but they would sell it for anything from $200 to $500.
• Undercoating – Similar issues as above, most cars have some form of undercarriage protection from the factory.
• Paint Protection – Admittedly there is some controversy over this one. Some say that any chemical application is sure to wear off in short order. Others believe that these “Teflon” coatings truly do work. If you believe in them, just purchase the product and apply it yourself. You’ll save hundreds if not thousands.
• Fabric Protection – 3M Scotch Guard is wonderful and works well. Buy a can for a few dollars and use it every 6 months or so. Again you will save hundreds over paying the dealer to do the same thing.
• Glass Etching – As a theft deterrent some dealers etch a serial number on each piece of glass, often costing $200 or more. Do you really think most thieves are going to pull out a flashlight to check for this miniscule writing? A bottle of glass-etching acid and templates can be purchased for less than $40.
• Extended Warranty -  If you must have the “peace of mind” I would suggest looking into buying a policy directly from the insurance carrier, there is no reason to allow the dealer to make commissions for just pushing the paper. Also, look very closely at what is really covered. Many consumers have purchased “bumper to bumper” warranties that hardly covered the two bumpers! Most would agree however that extended warranties are rarely worth the money. The quality of cars is much better today than years past and factory warranties last much longer.

Just say no.

Better yet, don’t buy a new car at all. Let someone else take the depreciation on the vehicle. Purchase a “previously loved” car, 2-3 years old with low mileage.

by PSD

There are many factors that affect the overall ownership cost of driving. What brand and model vehicle you purchase, is it new or “previously loved”, is the vehicle properly maintained or not are just a few.

Slowing down can also be a huge factor in the overall expense of driving. There are a number of reasons that contribute to savings when driving the speed limit.

The most obvious is gas mileage. The Environmental Protection Agency states that driving 55 on the highway instead of 65 will improve your gas mileage by 15%. At current rates of $2.63/gallon that is like getting a $.40 cent rebate on every gallon!

Another consideration is safety. As your speed increases relative to other vehicles on the road your likelihood of accidents also increases. Plus keep in mind as common sense and the laws of physics demands; the severity of accidents also goes up with speed. Fact: Slowing down saves lives!

A third issue that one must contend with at times is the Police. Yes, I am speaking of driving infractions and I am speaking from personal (recent) experience. The cost of gas and insurance can be budgeted but the unexpected and outrageous cost of a speeding ticket is not something that one generally budgets for.

I was speeding. I had stayed late at work (unpaid time and against the rules in today’s corporate environment) and was rushing to get home for an engagement we had with the kids. Without thinking I had passed a slow moving car and exceeded the speed limit. The result: a $210.00 ticket!

Never before have I fought a ticket. My father brought me up with the belief and a person should always be responsible for their actions. And oh boy, am I paying for this one. The cost of the ticket is bad enough, the potential increase to my insurance is more frustrating, however the worst punishment so far has been coming home to face my wife. Facing my wife and hearing the dreaded “I told you so” is much more painful than any ticket. She was right and I was wrong!

As a teen I was a speed demon. I justly received my share of tickets and nearly lost my license. Finally good sense took over and I learned to drive reasonably. Almost 20 years past without a speeding ticket. Then in the last several years my habits had changed. The speed of my driving increased more and more. My wife and lectured and warned me about my driving. So much has she tried to help me that a few years ago in an effort to get the “need for speed” out of my system my wife bought me a 10 lap driving experience at the California Speedway. Unfortunately, after driving in a Nascar stock car at 170 mph, I found that no car could ever go fast enough on the surface streets.

No one wants to have or pay for speeding tickets. If only it was the speeding ticket that we had to pay for, it wouldn’t be so bad. For many of us another impact of speeding is rising insurance costs. It’s too soon to tell but the long term cost of this ticket will likely be much greater than the $210 ticket alone.

For a few, another ticket may have much greater consequence. Do you work for a company that provides transportation or periodic use of a vehicle? In my case, this ticket is my third within a three year period and will trigger a Human Resource review. The possible ramifications run from a nuisance to major. During the review I face the possibility of:

1. Probation – My record will be reviewed more frequently, additional infractions will result in one of the following actions
2. Suspension – My driving privilege of company vehicles will be suspended. This will force the purchase of another vehicle for the family. In today’s market even a clunker is going to cost $4,500!
3. Termination – While hopefully a remote possibility, it is a possibility. In today’s economic climate some companies are trying to avoid the dreaded “layoff” but will jump at any chance to cull the headcount.

Please slow down, not only because it will save lives but because it may also cost you in ways you can’t imagine.

Since that time, I am happy to report I have been using the cruise control and watching my speed!