To Fix or to Ditch?
Contemplating whether to fix your ailing car or ditch it? Read below to help you make that difficult decision.
When an aging car needs repairs a lot of times there is the urge
to run to the car dealer and look at new cars. There are lot
of new models
out; futuristic, roomy, leather interior, hemi, just about anything
you can think of. We all see “our” car on the road except
there’s always someone else driving it. Before you go to the
car dealer and start looking at new cars it’s important to find
out if it’s better for you to put a little work in your old one. “Old
Faithful” may be a little rusty, hop a little at stops, and is
overdue for an oil change, tune up, tires, etc. but she’s still
paid for and gets you from point A to point B. So the dilemma commences:
fix or ditch your loyal jalopy.
First you need to find out how much your car is worth. You can easily
find this information by using car guides such as the Kelley Blue
Book or Edmunds. Hard and fast rule: Don’t put more into it than it’s
actually worth. Ask yourself if the money you spend on a down payment
could fix your old car instead. In the end you might end up with
a safe and dependable car for less money. Statistics show that
more owners
are fixing up and driving their old cars. The average car age is
9 years, the highest it's been since the 1950's.
To renew or replace? It's a big decision with several pros and
cons to consider. There are a lot of good points in favor of
renewing “Old
Faithful”. In many cases soon after the dealer courts you and
the vehicle is driven off the lot, your pride and joy falls in value
by thousands of dollars, an average of 25%. When the car is new, depreciation
is at its greatest. One of the biggest disadvantages of ditching your
current car is cost. The average price of a new car is $25,000 and
above so you don’t want to take on this financial burden
unless you have to. Since the value of a new car is high, finance
charges
as well as the cost of collision and comprehensive fire and theft
insurance will also be high. Choose a long-term loan, and you'll
be paying interest
on the original value long after it's fallen. Some other points
are that you are already familiar with your old car's problems
and idiosyncrasies
and if you renew your vehicle now, it will be in better shape
for future trade. Maintenance items for the new car may also
be more expensive.
Now it’s time to consider the points in favor of replacing. “Old
Faithful” can get you from one point to the other but not with
the same ride, comfort, handling and performance that a new car can.
New cars are stylish, fun, and covered by warranty. Look at diminishing
returns. If the cost of the combined repairs far exceeds the value
of your old car, you should trade up. Ask yourself these questions:
Has your life-style (family size, business, recreational interests)
changed so that "Old Faithful", no longer fits your needs?
Even if the mechanical systems can be restored in your old car for
a reasonable price, will body and/or interior fix-up work be costly?
Are state-of-the-art safety and fuel economy features of a newer vehicle
very important to you? Is the "image" created by
a new vehicle important to you? If you answered yes to any
of these than it's probably
time for a new vehicle.
The best way to get the most life out of your car is to keep
it properly maintained, including 3,000-mile oil changes
and other
maintenance
services. Though, as cars age you sometimes end up spending
more in repairs than the cars worth. Consider the pros and
cons, and
if you
see more pros, maybe it’s time to ditch.