4WD problem on 2006 Toyota Tacoma

MY 4 cylinder 4WD Tacoma purchased new in 2006, now with 29,000 miles, lost its 4WD. The indicator light on the dash blinks and the knob used to switch from 2WD to 4WD doesn’t do anything. I took it to Toyota and they said it was an actuator but couldn’t tell whether it was the front or back one. They suggested changing the one on the front first at a cost of $485, because changing the rear one would cost $1400+. So I could be looking at a $2000 repair. When I asked why this happened, they told me low mileage vehicles have more problems and I should have purchased an extended warranty.
Firstly, what causes an actuator to fail and secondly, any suggestions for a lower cost fix?