diesel trucks-worth it?

Non taxable per diem. He also gets a non taxable per diem for housing as the site is 2 hours from home. But he can't write anything off because they are basically reimbursing him for the use.

Get the Chevy Colorado with the Baby Duramax! Mother in law owns one and it is an awesome vehicle! She's always over 20 mpg and usually in the 25 range. They have incentives or did on them because nobody knew about the diesel in those little trucks. It's a great little rig and I've got dibbs on it for my wife when she sells it! $40,000 brand new!!

Can't use the little trucks. Even the 1/2 ton is questionable. He isn't hauling but the terrain is pretty rough. He said he has bottomed out the 1500 several times. If he gets his own he said it will definitely be a 2500 and if needed will add bigger tires to get a little more clearance.

boatman37 said:

Good point Alnav. Currently he gets a per diem for housing that is not taxed. I would guess that the truck per diem is also non taxed but not certain. A co-worker that started a week before him just turned his company truck back in and is going to start driving his own (2013ish F250 gasser). He talked to his CPA about it and after weighing everything he was further ahead financially using his own.

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Per diem for housing and a company paid truck. Doesn't get much better than that! I'd be looking to build net worth at a young age and investing the limit in my 401k (is there an employer match?) plus as much of my remaining salary in a brokerage account. If you do this for 25 years you will be a multi-millionaire. At that point you just pay cash for whatever you want to drive.

sbw1 said:

Per diem for housing and a company paid truck. Doesn't get much better than that! I'd be looking to build net worth at a young age and investing the limit in my 401k (is there an employer match?) plus as much of my remaining salary in a brokerage account. If you do this for 25 years you will be a multi-millionaire. At that point you just pay cash for whatever you want to drive.

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That's what I'm telling him. He gets $5200/month for housing and would get $1600/month if he had his own truck. Currently his housing is $2600/month and he pockets the rest. This is in addition to his regular pay. The issue is that he works about 70 hours/week (salary/exempt). He works 6 12 hour days and only comes home late Saturday night and leaves Sunday afternoon (and drives the company truck home). This would be ok for a few years max but would get old pretty quick so probably won't be a 'career' position, although it could be.

The company matches up to 5% for 401k so he will be doing that. His plan is to pay down his student loans as fast as he can. He owes about $80k on them. That's the reasoning behind buying his own truck. He would get rid of his car and the $450/month payment on it so effectively have $2050/month to go towards his new truck. Even if he bought a $60k 2500 diesel he could pay it off in 2.5 years. It would have close to 100,000 miles on it by then but still be worth $30,000 or so trade in. If he leaves that job after 3 years he could trade that truck in for a 'normal' vehicle and only owe $10,000 or so on the loan on it and likely just pay the rest in cash.

As for a brokerage account...I do that...lol. I day trade options every day and do pretty well.

Based on the earlier comment by the auto diesel mechanic, I would skip the diesel truck altogether. The most unrewarding money you can spend is for repairs on troublesome engines. Still think the company truck is the way to go. However, it's only money, and bright folks figure out ways of making more of it.

$1600 a month. Pay it off and keep it in 36 months. Figure out what a 200,000 mile truck would go for. Even if he got half of what it would be worth after 6 years, say even if he got $10,000 for it. And he would be putting $1600 a month in his pocket for the next 36 months ($56,000). He would be able to Buy a NEW truck cash and then put $1,600 a month in his pocket for the next 72 MONTHS ( $115,000) and so on....DO THE MATH.......There is no way I would trade in a diesel after 100,000 miles. I have friends that have well over 300,000 on there's and still going strong. And it looks like Highway miles too.

mnm99 said:

$1600 a month. Pay it off and keep it in 36 months. Figure out what a 200,000 mile truck would go for. Even if he got half of what it would be worth after 6 years, say even if he got $10,000 for it. And he would be putting $1600 a month in his pocket for the next 36 months ($56,000). He would be able to Buy a NEW truck cash and then put $1,600 a month in his pocket for the next 72 MONTHS ( $115,000) and so on....DO THE MATH.......There is no way I would trade in a diesel after 100,000 miles. I have friends that have well over 300,000 on there's and still going strong. And it looks like Highway miles too.

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My only concern is from what I have seen the diesel warranty is only good to 100,000 miles. They aren't cheap to fix

Trust your instincts. Lots of people spend too much for vehicles. A good used one is usually the best way to go assuming you check out reliability on sites such as Consumer Reports or other trusted sources. It is far more important to buy a secure retirement than a truck.

You can always look at “certified pre-owned”. You may pay a little more, but you get a warranty from the original manufacturer.
I have a friend who buys cars that way.

definitely have to check the used trucks too but from what i have been told and have seen a good used one isn't much less than a brand new one? seems like 3 year old diesels with 90000 miles on them are about $40k where a brand new one is $60k.

As for retirement, definitely need to plan for that but he is 25 so lots of time there. and with the new truck he will have (or should have) more money in his pocket in the end with getting the $1600/month. additionally he eliminates the $450/month he pays on his car now.

GO GAS!
The DEF that has been mentioned before is a PITA. And that's putting it mildly. SES Lights are zero fun. And it will require a trip to the Dealer Doctor to get it cleared up.
I have an 02 Z71 1500 Silverado, 5.3L GAS. 300K + miles. Pretty much worthless on resale.
I like my truck. I'll just keep fixing it. Only things so far that have gone bad are the alternator and the Radiator.
It doesn't mind the cold (diesels hate cold), runs like a sewing machine, and I get like 18MPG combined.
Oh, and it doesn't smell like the ramp at the Airport (See, JP4 and JP8 are pretty much Kerosene/Diesel fuel, so the ramp at the airport smells like diesel burning..yes, I know, it's an obscure reference. It's sorta my "thing".)

Whether or not you drive a company vehicle is an interesting problem to have. I would like to have that particular problem. Personally, I think I would probably drive the Company Vehicle for a year, just to see how it went, then maybe decide if the time remaining in the company would warrant the purchase of my own vehicle for work use.
Maybe he is not going to be there for 4 more years.
Maybe some hottie in short shorts with an idea to marry will catch his eye.
Maybe he will decide he wants to be an orthodontist,
or live on a boat and drink Margaritas....etc.
Difficult to predict the Future is. Always in motion, and clouded with emotion.

But I digress.
Living in a hotel, driving site to site (I assume Construction/Oil?) is going to cause some serious wear on the truck. That will most certainly impact your resale, whether powered by Diesel, Gas, or Nuclear reactor. People that buy used vehicles want to know how the vehicle was used. Mostly highway use/Miles? ummm...No..Mostly Mud, dirt, rocks, boards, nails, concrete, and ruts and stuff, sitting in traffic back and forth. Things (tools, toolboxes (like the commercial), boxes of nails, supplies, people, dead hookers), thrown in the bed of the truck.
Yeah.
Probably not going to be bringing in that High Resale number.
(I used to sell cars in another life, and you don't have to be a smarmy shyster to do it, trust me )


A diesel boat on the other hand, is a different animal.
But that's a totally different discussion for a different day.

Yeah. The 1500's aren't quite beefy enough. They have things called water bars which are like huge speed bumps. He bottoms out on those every time he crosses them and actually tore the front valance off it already. He is considering 1/2 ton but will need a lift and bigger tires. The 2500's they have don't bottom out there. I hate diesels. They sound horrible and stink worse than a sewage plant but with that many miles he might be further ahead. He got this truck the middle of April with 250 miles on it and last I heard it had over 6000. Whatever he buys he will be getting an extended warranty and the company pays for almost all maintenance. His boss just had over $600 done on his with oil change and fuel filters and they paid for everything. They also pay for tires so with a warranty not much will come out of his pocket.

The job is pipeline. He doesn't haul much. Hardhats, cooler, first aid kit, forms, etc. He is a Safety Coordinator so he doesn't do any 'hands-on'. Mainly checking up on workers and conditions and filling out reports. He will probably be going to a new site in a few months and he was thinking about buying a travel trailer and staying in a campground. A few guys there do that and bank away their housing per diem. He isn't allowed to tow with a company truck so if he goes that route then he will have to buy his own truck. A 1/2 ton will definitely tow whatever he buys but by the time he adds a lift kit and bigger tires (for the terrain mentioned above) he might be further ahead with the 2500. He thought about a Ford Raptor but at $70k he might as well get the 2500 diesel.

Still pretty early for him to decide so he has time. He wants to save up more for a down payment to get the loan amount as low as he can. He did find out the truck per diem is taxed so after taxes they get about $1000/month so not as good as the $1600 it starts out as...lol. But he would be getting rid of his car and the $450 payment on that so if he takes that and that $1000 per diem then he will be paying about $1500/month on the new truck he buys.

The new Ford diesel pickups don’t smell at all, and are quiet. It’s so quiet that when I pulled up to a pump island at a turnpike service area the attendant walked up and asked me if it was a diesel (I had pulled up at the diesel pump, of course). 2016 F250 with 6.7 Powerstroke. Bone stock. I get 15 mpg around town and 17-18 on the highway.

I’ve driven my Dodge dually well over 400k miles with relatively few repairs. I do most of the work myself. I’m getting older so it’s more difficult. However over this time period my truck is the lowest cost per mile vehicle I’ve ever owned.

Now for your son’s truck. I’d get a pre 2007 version so you get around the DEF additive and advanced emissions. One thing that is pretty universal is that some time after 100 k miles you are going to be in for a front end rebuild or repair, especially bounding around in the fields. It’s not cheap even if you can do the work yourself. Mine is 2wd for that very reason. I lost a front spindle but the shop repair was only about $400. I drive about 100 miles a day and tow only occasionally and them very light.

An additional consideration is using the truck for work. Your insurance can be impacted for this. Additionally he may have to have a commercial driver’s license. CDL. There are rules and regulations for this. Check it out.

Diesel trucks are not cheap even used. Repairs are very expensive at the “stealers”.

I’d go with a newer compact car and forego the truck if possible. They would have a pretty trouble free 100 k miles and get pretty good mpg.

My truck gets 20-21 mpg but I have to drive it conservatively. My grand son has a Ford 6.0 dually. The front end drive gave out right after he got it. Before he could fix it, the motor blew a head gasket. It was 6 grand to fix the motor and turbo. He is still looking at 2-3 grand to fix the front end.

Many diesel trucks run trouble free for a long time if not loaded down. But beware.

Byrob

compact car is out of the question. his 1/2 ton struggles to get to the job site. he has already ripped the front valance off due to ground clearance issues. he is the only one on his team not using their own vehicle and the others all have 2500's or 3500's. if he buys anything it will either be brand new or at most 2-3 years old. he needs a reliable vehicle so buying a pre 2007 isn't going to work. and he wants something with a warranty.

he will likely be moving on to the next site later this year so will probably wait until then to do anything.

I used to work in oil. We got trucks and cars. As one superintended put it when he got a dint in a front fender. "I do not own a bolt in it"
For 8 years I ran large jobs as a consultant after I retired. The contractors had similar policy for trucks. Those that supplied truck to the workers complained about how much it cost and the those workers that got paid for their trucks complained about how expensive it was. The rules then were $100 a day with $1 a mile after 100 miles if you supplied your own vehicle. Once a worker had a break down in a small town. The dealer hosed him on repairs. I informed him we hired him and his truck. No truck no work. He rented a truck until his was fixed. I would never use my own vehicle for company use. Plus if he looses his job he is stuck with a truck he has no use for along with the payments.

That is a risk. They get $67/day but it is taxed. They don't pay for their own fuel, tires, or oil changes. If your truck is down you can take a company truck. Happened to 2 of the guys on his team a couple weeks ago. One bought a slightly used truck that had a real bad shimmy. Turns out it had a bent wheel but it took them a few days to get a new wheel. The other just took his in for some maintenance and repairs.

There is the fear of him losing his job but they do have a few more projects lined up and he should be good for at least the next couple of years. His plan would be to pay $1500/month on it and have it paid off in about 3 years. If we loses his job after 2 years then he should have enough equity to get a decent trade. The other side is they get $5200/month per diem for housing. Currently he pays $2600/month. He is talking about buying a camper and putting it in a nearby campground but they aren't allowed to tow with the company vehicle. We did talk about using my truck to get the camper from point to point but if he gets his own truck then he will have about a $30k asset after 3 years that didn't cost him anything. He is getting married next year so he is looking to pocket as much money as he can.

The only real downside I see is he got his truck the day he started (April 16th) with 200 miles. He was home last weekend and it was just over 9000 miles on it. That is the reason for the diesel. The other thing is he is picky about his cars. He keeps them spotless. I told him that's why they pay him what they pay him for the truck. He has to expect to get dents and dings in it. As long as he is ok with that then it might be a good deal.

People got a living allowance. Some bought trailers some rented houses some stayed in motels. A house is a home a trailer is a tent on wheels a motel is like living at home it is cleaned daily and the heat or AC never fail. I always stayed in motels that had a separate bedroom. When a job was done I left and had nothing to worry about. The trailer people seemed to be fixing things all the time and in the winter they had problems. As one boss put it when an employee became full time staff. "You are employed until you do something bad or we do not need you".

scoflaw said:

Don't forget sales and excise tax and insurance in my state goes by drivers age. Those 3 items in Mass. could easily be 10K over 3 years. Are people really paying 35K for a pickup with 90K miles on it ?

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simple answer, Yes.
i traded my 06 ram 2500 with a cummins 1 year ago. the dealer gave me $14,500 for an 11 year old truck with 166,000 on the clock. i guarantee they sold it within a week for over 20