I'm still a big fan of the "beater" as a daily driver. In Minnesota it is a necessity as driving an XF during the winter is a sure invitation for rust to set in very, very quickly.

Although I'll probably have to replace my Corolla soon (just because I'm getting a little more worried lately about what would happen to me if someone hit me hard while driving it), it's been serving me quite faithfully in Virginia and served me quite well in MN with all-season snow tires. I still take 800 mile trips with it to visit my parents in Tennessee and it comes in useful when hauling steel/aluminum for building, other auto parts, groceries, and other little things.

As others have said, insurance costs are the biggest additional expense. Another issue is that unless you have a stable job, moving around with two cars is expensive unless you are married and have someone who can help you transport both cars.