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Reader Question: My car is getting old and my repair bills are getting larger and more frequent. How do I know when to get a new car and stop repairing my existing used car?
I get asked this question quite often, but in some cases not often enough. Seems some people have a "problem" with a $300 a month new car payment, but they are perfectly comfortable with paying the same if not more on monthly repair bills and accept the inconveniences that come with them. I don't know what "drives" people to a high mileage goal? I hear customers comment "This car has to go another 20,000 miles" or brag about how many miles they are determined to put on their vehicles. "I am going to drive this vehicle 180,000 miles whether it likes it or not". Now if this is a challenge for you, by all means take it, but I can think of many other challenges less costly. Granted, some cars will last a long time and do so with relatively low maintenance cost, but this is not the norm.
How does one know when to throw in the shop rag and get a new car? Well, I don't have a crystal ball bearing, but I can provide some helpful guidelines to assist you in your evaluation process. First: Perform an evaluation of your vehicle yourself using our used car check out list from our Website. The check out is self explaining and easy to use. If you have a concern or a potential problem you might uncover with an item on the list, have your mechanic inspect it during the next step. Second: Determine what future maintenance cost will or could be. I have assembled a helpful automotive maintenance schedules to help you forecast costly maintenance items. Print out the maintenance schedules that are closest to your current mileage and the next higher mileage schedule. Take your car to the mechanic (hopefully the mechanic that you regularly visit and have a good relationship with) and pay them to inspect all the items on the two schedules. The cost of these inspections should be fairly inexpensive, and the information they will provide will be more than worth the expense. Add up all recommended repair costs plus all previous repairs during the year. Divide this number by 12 to determine your average repair cost for the given year. This number will not however include any breakdown or unexpected repairs. Third: How much is your car worth? Trading in your vehicle for a new car is the easiest, but will not bring in the most money for you. The car dealer will pay you a wholesale price for your car, and in doing this you are leaving money on the table. Selling your vehicle to an individual at a retail price will require a little more work on the part of the seller, but there can be greater financial gain in doing so. I recommend going to see and test drive your competition before you set a price on your car. Take along the used car check list and evaluate the competition just as you did your car. How does your car compare? Could you place a higher price on your car after your evaluation, or is your competition in better shape? Fourth: How much will your next car cost, and how will you pay for it? Get new car prices from local dealers in your area and on the internet.
How much of the sale of your current car can you use as a down payment on the new car? When buying the car be sure to take advantage of rebate incentives and low or zero interest on certain models the factory is trying to move out. Keep in mind you are replacing a vehicle that you know will be incurring future repair costs, so don't take on more money debt than you can handle. Hopefully you have a month or two before these expected repair bills will be required, so you will have some time to price shop the car, and have time to sell your current vehicle. For more information about buying and selling a car check out our site Before buying and selling! Some things to consider: In my opinion I would replace your current vehicle if your average yearly repair bills are more than ten percent of the price of the new car you would like. These four steps are just a guide to help you remove the emotion tied to selling your current car and buying the new one. After doing these steps you might find that you are not in the "money pit" and the maintenance schedules and check list gave you an easy way to forecast and plan for up coming repair expenses. The schedules and check lists are free for you to view and print out from our Website Blessings, 
Austin C. Davis
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