To repair or replace? That is the question.
Fix That Ailing Car or Replace It? Tips to Help You Decide
While you’re out at your favorite dealer pining for the sleek, new vehicles on the showroom floor, “old faithful” is probably parked in your driveway, longing for new tires and a brake job. But she’s paid for. And so the story begins.
When an aging car needs repairs, drivers often take the quickest route to their nearest new car dealer. But what if you spent your down payment on your old car, instead, and made it serviceable for another year or two? Today, more owners are fixing and driving their older cars. Average car ownership is up to 9 years—the longest it’s been since the early 1950s.
There are plenty of pros and cons to consider when deciding if you should repair or replace. Here are some points in favor of repairing:
- No big car payments (an opportunity to save for the down payment on a future new car purchase)
- Less sales tax to pay
- Lower insurance premiums
- No major depreciation (a new car loses an average of 25% of its value when it leaves the showroom, and 40% of its value in four years)
- You know your old car’s problems and quirks—that’s not true if you buy another used car Of course, there is a point of diminishing return to every financial decision. Changing cars is no different. If the cost of the combined repairs far exceeds the value of your old car, chances are you should trade up. Consider the following pros regarding a new car investment:
- You may need a new car if your lifestyle (family size, business, recreational interests) changes to the extent that “old faithful,” even if fully restored, would no longer meet your needs
- If your car needs several major repairs, such as both engine and transmission overhauls (possibly as a result of neglected maintenance), a new car may be best
It also may be best to buy new if:
- Body and interior repairs would be costly even if the mechanical systems could be restored for a reasonable price
- State-of-the-art safety features and the highest possible fuel economy are important to you
- It means a lot to you to have a new vehicle parked in your driveway
In the end, you are the only person who can put pencil to paper and decide if it’s time to buy a new car.
If you would like to know more about vehicle price information, we suggest you visit www.edmunds.com.