Fix It or Junk It?
Last spring an AskMetafilter user wondered: At what point is a car not worth repairing?
My ten-year-old 130k-mile Saturn is showing its age pretty badly — leaking oil, disturbing noise coming from the front end, crumbling exhaust system. I’m having a tough time coming up with a satisfying way to determine if it makes financial sense to pay for the repairs or to just ditch the car and buy a new one (living carless isn’t an option, cool as it would be).
The discussion includes how to decide when to buy a new car, whether one should buy new or used, and the advantages (or disadvantages) of leasing. One poster invokes the Car Talk guys, who say: “It is always cheaper to keep driving your old car than it is to buy a new car.”
Previous: Track Airline Miles in Quicken
Next: Paycheck Calculator
![[tips [-at-] moneyhacks [-dot-] org]](http://www.moneyhacks.org/images/tips.jpg "Please include any credit information you'd like posted, too"){kind=small}
.
bankelele said,
February 27, 2007 @ 5:09 am
Had a similarly story with an old Peugeot until about a year ago. I kept it going by having a string of mechanics on 24hr call. Repair costs were not high, but psychological ones were higher - I just never knew when the car would fail on me and so there were some places / events I could not go. Eventually I sold it and bought a Toyota. I now realize that new car payments (for Toyota) are much higher than repairs (for the old Peugeot) but the piece of mind to go anywhere, anytime is priceless
Adam Davis said,
February 27, 2007 @ 7:12 am
My cars typically cost me 10 cents per mile (not including gas, but including original purchase price, oil changes, repairs, maintenance, etc).
So if the car starts costing more than that, then I get rid of it and get another car. You can figure this out on a case by case basis - ie, the transmission needs to be replaced, it’ll cost $2,000, but the car should run for at least another 40k miles afterwards. You also need to look at the long term cost. I spent $500 in repairs and maintenance last year, but I drove 20k miles - so it’s still worth it.
When the engine goes, that’ll be an interesting one to figure out.
But I’ve pretty much written this car off - someone sideswiped it while it was parked and their insurance gave me $1,800 for repairs. I replaced the broken window and mirror for $120, and as far as I’m concerned the car is now ‘free’ for me.
Gwyn said,
February 27, 2007 @ 6:54 pm
I’ve never made a “car payment” in my life. Some people treat them as a necessity, like the electricity bill or buying milk and bread from the supermarket. If you only buy cars that you can afford to pay cash for then the question of whether or not you would be better off to buy a “new” (or used) car becomes moot, instead you just do it whenever you have a need.
Stefanos said,
February 28, 2007 @ 1:09 am
Cars is something you should not buy new. Other than that, replace a car whenever your needs change or as benkelele pointed out when you constantly are thinking when your car will break down again. I personally prefer used German cars, they are quite reliable (more than American but less than Japanese) and are the most fun to drive.
“The average new car loses 12.2% of its value in the first year, according to Edmunds.com; on a $20,000 car, that’s $2,440, or more than $200 a month. Some cars depreciate even faster, depending on demand, incentives offered and other factors.”
from http://articles.moneycentral.msn.com/SavingandDebt/FindDealsOnline/10thingsYouShouldntBuyNew.aspx
mapgirl said,
March 2, 2007 @ 2:26 pm
I thought a lot about my costly car repairs last year. I put in a new clutch, catalytic converter, brake rotors and brake pads for about $4K (including all other service like oil changes, etc.) The thing is, if I get a new car, for a $400/mo car payment, that’s still more than maintenance. This year, I will spend a lot less on maintenance, probably only $2K. So year over year, I save money by not getting a new car because I’d still have *some* maintenance costs, even with a new vehicle. The maintenance costs just won’t be as much.
Till I can get a new to me car for purely cash, I am going to stick with the car I’ve got.
alex said,
March 2, 2007 @ 3:07 pm
I have a 1997 subaru with 210K miles on it and I have ragged this car out pretty bad. Its got dents, rust, a missing fron bumper but runs like a charm..always cranks and handles great in the snow. I dont worry about cleaning it..my wife calls it the “hoopty-ru”. Its cool though, i am saving cash for another one, but will wait to see if i can kill this one first…Insurance is cheap when you do not finance either..My neighbors got 2 new cars, but the car payments are killing them and I am sure the upkeep and insurance is high.
phillip said,
March 3, 2007 @ 5:11 pm
There can come a time when the monthly payments to fix the old beater a Dodge van was averaging about 200 a month. A good used buick century was only 170 a month payments It was a wonderful change. The century lasted well past payoff.
Lisa Allen said,
March 25, 2007 @ 7:04 am
The first thing you have to consider is your back up system when your car is undergoing repairs. If you can get by for a few days, you have the freedom to tolerate a less reliable vehicle. If not, you can’t afford the luxury of a crummy car.
Never never never never buy new cars, and never finance anything that isn’t going to appreciate in value. Cars don’t. The time my husband ended up buying a 73 Dodge, because his sports car died the week we closed on our first home, I came to understand that being really serious about economic principles ain’t always pretty.
One cool thing about the decision to pay for a car without financing? I paid for my present car using my credit card, and paid the bill off at the end of the month. My bonus for that? Frequent flyer miles that took 2 of us on a vacation.
There may be one 73 dodge between you and economic freedom, but it’s worth it.
anonymous said,
April 10, 2007 @ 10:34 am
it really all depends on how much longer you think your saturn is going to last.. me personally? i’d do the maintenance and keep the car til the wheels fall off
both my cars (paid for) have over 100k miles and i plan to keep them as long as i can
i have a tercel that i drive for commuting.. and a lexus for the weekend.. both are reliable and both will last at least 200k miles guaranteed.. i don’t plan on buying a car anytime soon (for at least 5 years).. and the money i save on monthly payments will go to my retirement fund instead.. common sense
Mary said,
August 14, 2007 @ 12:33 pm
We never buy brand new cars or trucks. If you buy an ‘off lease’ vehicle, you can finance (if you have to) at new car rates and usually have a bit of the Manuf. original warranty left. Low miles and low rates. For those who pay cash, the returned lease cars are very negotiable. Good money practice . . negotiate.
Terry said,
January 29, 2008 @ 1:44 pm
Most modern cars go past the 100,000 mile mark without even blinking. A car that is at 100,000 or a little beyond is a no-brainer. Keep it. I’m shocked that the Saturn mentioned at the beginning of this thread of comments is showing significant signs of aging at only 130,000 miles. There is something seriously out of whack if that’s the case. Makes me think twice about ever buying a Saturn! I have a Grand Voyager min-van with 270,000 miles on it and I’m only now at the point where “Fix it or Junk it” has become a serious question. I’ve had 2 major repairs and one maintenance job all within a couple of weeks of each other. That’s probably a sign that the risk of additional repairs and maintenance in the very near future is high and that the average monthly cost will exceed that of a newer car.