Your car broke down, and now you're faced with a high repair bill. It's not the first time this has happened, and you're getting tired of pouring money into an aging machine.
A new car would be nice, but is that the smartest decision? Would you be better off fixing your current ride, or is it really time to buy another one? There's no clear-cut answer to these questions, but we can show the pros and cons for each option to help you make a more informed decision.
Even if you've taken good care of your car, some high-priced repairs are unavoidable, sometimes due to excessive wear or time itself. Rubber belts and hoses dry out and crack, metal on rotors warp or wear too thin, and electrical parts stop working. Repairs can begin to surface between 50,000 and 100,000 miles.
It is almost always less expensive to repair a car than buy a new one. Although something as severe as a blown motor or a failed transmission will run you between $3,000 and $7,000 to replace at a dealership, such repairs still don't cost as much as buying a new car. That $3,000 or $7,000 would certainly make a nice down payment, but then there are the monthly payments to consider. You can perhaps purchase a used car for that much, but just keep in mind that another used car could come with its own set of issues.
Insurance and registration fees will be higher on a new car. A new car typically loses an estimated 22 percent of its value in the first year. Your car has already taken that depreciation hit.
If you are not yet faced with making the tough decision to fix up or trade in your vehicle, there are steps you can take to prevent or avoid costly repairs.
Get your new car maintained at its proper intervals to avoid problems and breakdowns. Use our maintenance guide to learn the recommended service intervals for your vehicle. Maintaining a much older car means paying close attention to items that commonly break down. We recommend finding a good, reliable local mechanic as a less expensive alternative to a dealership service department. If you're experiencing issues with your car and don't know whether things are likely to get worse, look for advice on message boards and forums for the make and model of your car. Other people have probably been down this road before you. You can get a preview from them of the problems associated with your vehicle as it ages.
Everyone seems to have a theory on when to repair a car and when to get a new one. But you know your needs and your car's history better than anyone else, so use these tips as a guide, not gospel. Buying a new car might seem like the easy way out of a high repair bill, but depending on your circumstances, it may not be the best financial decision