What’s the rule of thumb on spending money to repair a vehicle vs trading for a newer one
Realistically it depends on how much money you have to spend on the new vehicle.
What is your budget?
For example if you have a vehicle that needs $1000 in repairs but can only layout maybe $2000-$3000 for a different vehicle you likely are better off keeping your old vehicle/repairs.
There isn't a rule of thumb. This is a highly personal decision, but it's usually less expensive to repair a vehicle than it is to replace one.
Of course, there is a point at which it's no longer worth trying to keep a vehicle on the road.
Knowing nothing about your particular vehicle, it's really hard to advise.
There is no rule of thumb for everyone. It varies:
- If you are fortunate enough to be able to afford a new (or a new used) car, and you prefer not to drive an older car, you probably don’t want to pay more for a repair than the car is worth.
- If you would prefer not to purchase a new or used car, and you don’t mind driving an older car, it depends on the overall condition of the car and the cost of the repair. Will spending $1,300 to fix the air conditioning likely lead to more repairs, or will it likely be your only repair expense in the next year? $1,300/year will likely be lower than car payments you would pay on a new or used car, making the repair worth the money if the car is otherwise in good shape. Don’t include maintenance in this equation since you will be paying for maintenance either way.
I can only speak for myself, since everyone’s criteria are different.
Ii generally buy new and keep my cars until
- they become unsafe
- my needs change (my most common reason)
- they become unreliable
Of course, one criteria used to be “my wife says we need a new car”, but that no longer applies to me.
I’ve only had two vehicles become unsafe. One was my '72 Vega. The rear wheel came off…still attached to the axle. Vegas did that. The second was my '79 Toyota pickup. The frame rotted completely out on both sides after almost 11 years and the truck broke in half.
I’ve never actually had a vehicle become too unreliable for my needs. I guess because once they get a few hundred thousand miles on them I accept an occasional repair.
If you buy vehicles with a reputation for long term reliability, you maintain it properly, you check it over routinely and keep up with anything that needs repairing, and you don;t abuse it, the engine and drivetrain will usually last indefinitely. After a few hundred thousand miles you’ll start having to occasionally change things like the radiator, the alternator, the starter, and peripheral components, but the heart of the vehicle will last a very long time. If reliability is critical to your needs, you may want to consider trading when these components start to fail. If you, like me, can live with an occasional repair you can drive on almost forever.
We generally keep our vehicles until…
. Too many miles to start putting money into it.
. Needs change.
. Too Unreliable and costly to drive…
3 of our last 4 vehicles met the first criteria…All 3 had well over 300k miles on them…and they started to show signs of wear…For me I do some significant amount of towing in the summer and didn’t want to have any problems while towing…
My wife bought a new Lexus in 08 because she had to sell some of her stock-options or loose them…Her Accord had over 230k miles…and she wanted a quieter ride…With her stock options we bought the new Lexus CASH…We also had a Niece starting college who needed a car…so we gave her the Honda as a graduation present…
The last vehicle I had that was so unreliable was my GMC S-15…I was a Software Consultant at the time…and every time that truck broke down I lost working fixing it…and lost work as a Consultant means lost pay. The last 3 months of ownership I probably lost over $3000 in pay…not to mention the money it cost me on parts and/or labor (if I didn’t have the time to fix it myself)…plus a couple of those times I couldn’t take the time off from work…and needed a car so I had to rent one…
But if a car is running good then I keep it for a long time. When it reaches 200k miles I evaluate it and make a decision if we should keep it another year. My evaluation is based on how well it was running at that time and how well it ran in the past year.
I forgot one trade in my earlier post. Old age. Mine, not the car’s.
I had to trade in my 2005 Corolla after only 2 months because it was KILLING my bad back. I mentally considered the money lost ($2500…ugh!) as a “medical cost”. The need for comfort is an absolutely legitimate reason to trade a vehicle. Health comes first.
The issue is can you afford an new or “newer” car. There really is no fixed rule. An old Camry or Accord could be worth a lot of money in repairs if the body isn’t rusted. A five year old Yugo was junk. Lot’s of variables.
As you can see, the regular posters on this forum keep their cars longer than the average driver, and have a good idea when they should trade.
We have scrapped 2 cars because they became unsafe; one became history due to a crash, and the rest were either given away to relatives. or sold because they no longer met our needs.
In general, we get rid of cars when:
The car becomes unsafe due to corrosion or other factors
The vehicle becomes hard to start (parts unavailable) and becomes unreliable. Our 1977 Dodge Colt fit that category in 1997, with only 98,000 miles on it!
The car is simply at the end of its normal economic life, and ongoing annual repairs start exceeding the normal residual value.
This “end of life” varies greatly; my brother’s 1987 Accord is close with 350,000 miles on it. An 8 year old Aveo, on the other hand, with 90,000 miles on it, would be in similar state.
Another factor not mentioned is your emotions are not handling it. Emotion should not be a primary factor but an important one.