That’s a darn good question, and a subject near and dear to my heart. I drive a ’94 Honda Accord, which I got for a bargain from a friend, two years ago. The fact that I have had the car for 2 years is great, but things are starting to “go” on it, so when is it time to think about replacing an old car?
Darn good question.
I guess the parameters you need to think about are:
- Do you still owe money on the car from when you first bought it? You don’t want to “jettison” an asset and keep the debt, now do you?
- If you total up the repair bills so far this year, and then divide it by the number of months so far, how much money is that? What you need to compare that with is how much would a new/used/clunker replacement would cost. Remember buying another car has a poop load of expenses including:
- Taxes (if you buy new)
- Transfer costs (if used)
- Gas mileage, is this older car getting bad gas mileage? In these days of gas at $1/litre that is something to think about (maybe a newer smaller car gets better mileage).
- Would it be cheaper just to take the bus? This is a bigger question but maybe one to think about if you have moved downtown and are paying $100 a month in parking expenses! A car creates MANY extra costs, that maybe we don’t always look at.
- Do you need a second car (in my case the answer is YES for now)? Maybe you can last a couple of months with only 1 car? Those few months might save you a few bucks and show that you didn’t really need that second car?
Just a few things to think about before you push your old car off the cliff