When to Buy a New (or Used) Car vs. Repair

Have you come to a crossroads in car ownership? Are you trying to decide if it's worthwhile to repair your current car or start fresh with a new vehicle? Sometimes, it can be more expensive to repair a car than the car is worth. However, it could also be more financially responsible to repair your current car than try and buy a new one. These tips should help you determine if it's time to let go or if you should keep trying to fix up your old wheels.

When to Buy a New (or Used) Car vs. Repair Your Current Car

  1. Constant oil or fluid leaks
    • If your car has been frequently encountering issues with leaks, then it might be indicative of a larger issue. In this case, you might consider having a professional try and sort out the root cause of these leaks. If it can be easily fixed, then it's probably best to repair it and move on. If it's going to keep happening, then perhaps buying a new car is your best bet
  2. Frequent tire wear and tear
    • If you notice your tires are constantly wearing down, especially if they are wearing down unevenly, you should have the alignment checked. If the issue is your tire alignment, this is a quick and relatively inexpensive fix. If there's something else going on, then you might be better off getting a new car.
  3. Your car is breaking down
    • When your car is breaking down on a semi-regular basis, that's a clear sign that you might want to consider getting a new car. It's likely that there will be a constant need for more repairs in the future, and buying a new car will spare you from that trouble.
  4. The repairs needed will cost more than half the value of the vehicle
    • While repairs can be very costly, the cost needed to repair your car should not exceed more than half of what the vehicle is worth. If it does, then you are much better off buying a new car. There is some flexibility here, but the general rule of thumb is if the repair cost is more than half the value of your car, then you should get a new one instead of spending time and money fixing up your current car.
  5. Your vehicle no longer suits your lifestyle
    • There are several reasons one might outgrow a vehicle. Perhaps you just had a new baby, and now you could use some extra room in the back seat. Maybe your kids have just gone off to college, and the minivan life isn't for you anymore. Whatever the reason, if your car is no longer meeting your needs, then it's time for a new vehicle.

If you've decided it's time to throw out the old and bring in the new, then you might now be trying to decide between buying a new car or buying a used one. Generally, you can save a fair amount of money by purchasing a used car. Cars depreciate as soon as they drive off the lot, so a brand-new car will depreciate very rapidly over the first year. Buying a used car might spare you a large chunk of change, but buying new usually guarantees your car with a manufacturer warranty and often a routine maintenance plan. Also, dealerships usually offer payment plans on cars they sell, making the immediate financial burden less. If you elect to buy a used car privately, it is unlikely that the seller would offer a payment plan. Keep in mind when you buy a used car, you run the risk of the vehicle having issues that were not disclosed to you at the time of purchase. There are pros and cons to both options, but ultimately the decision to buy new vs used is one you'll have to make yourself.

If you are still trying to decide between repairing your current car or replacing it, keep in mind the tips listed above. Whenever a car is consistently having problems or it needs repairs that equal at least half or more of the car's value, then it's probably time to look for another set of wheels. If you do decide it's time for a new car, consider if you are interested in a "new" new car or a "new to you" option. Both have their advantages and disadvantages, so you should go with what's best for your lifestyle and budget. When you choose to get a new vehicle, consider donation as an option for your old car. It's a meaningful way to change lives and make a huge impact through the gift of a car you no longer want or need.