Time to Retire That Clunker?
courtesy of Bob, The Auto Answer Man
How can you judge when you've put as much money as you ought to into keeping an older car running? Is there any rule of thumb ... such as when your expenses per year exceed the dollar value of the car it's time to get rid of it? It seems that it's always just "one more thing" that it needs.
What is your advice on how to judge the value of a used car when it IS time to replace the old one with something a little newer? Assume, for our sake, that you're dealing with a very limited budget and looking just for reliable transportation and not necessarily anything very classy. Thanks.
If I knew the answer to that question, I think that I'd be a millionaire! But, in the sense of frugal living, I'll give it a try. First off, when is it time to get rid of that old clunker? That is really up to you. A lot of people seem to get attached to their beloved transportation. Look at it this way. The two of you (you and your car) spend a lot of time together. If that car could only talk! Some of the things that you might have said when you were upset, oh boy watch out!
But all kidding aside, now that your car seems a little sick, and it's always costing you hard earned money to keep it going, then maybe consider something a little newer. Now, I have a friend who is in this same situation, and I will tell you the same thing I told her. Your car has over 150,000 miles. It lived it's life. Give it a decent burial (or if you don't want to junk it, sell it to someone who doesn't mind working on it.) Generally there is a Vo-Tech (Vocational - Technical) High school somewhere in your area that has a shop class that might be interested in it. I have also heard of some places that if you donate your car to them, the full value is a tax deduction. The charities that either fix up the car and sell it, or take it apart and sell the parts. Either way, it is a charitable deduction on your part.
Now, my advice is when you are ready to buy a new (or newer) car, first check out edmunds.com . This place will help you determine the value of what you are selling and what you are buying. After that, I'd say if you had a choice between 2 cars, one being good and a little more and the other needing some work but a little cheaper, I would buy the one that is a little more. Who wants someone else's headaches! Not me.
Now, if you buy a used car from a dealer, they usually offer some third party warranty. This should cost about $150 for 6 months. Take it! This way, for the next 6 months, the car will not cost anything more than gas and oil. Now, if you feel that you would want to keep this piece of mind, they (the warranty company) will send you a notice after your 6 months are up and ask you if you want to renew. Usually you can get up to 3 years of warranty for around $500.
Now here is something else that you may have not considered, There are a lot of NEW car dealers that are offering really cheap leases on econo-boxes... I remember hearing something about a Hyundai for $88.... that's cheap... but check the fine print, read how much down you need.... I also remember hearing that the Federal Government is passing regulations that will make those lease deals tell the fine print in much easier to understand language. This way you do not need to be a lawyer or a financier to understand what they are saying...
Now, here is a third possibility. If you live in a big city, then you probably don't even need a car! Mass transit could probably take you anywhere you need to go (during the day that is). There are some places that even I wont go after dark! But, that is a topic for another forum.
So Nancy, as you can see, there is no straight cut way to determine where and when to get something new. Just use good judgment and remember that they are selling it for a reason and it is your job to discover why. In my travels, I have only discovered one (yup uno, singular, just this one guy) used car salesman that was honest. Now I am not saying that there are not more out there, I just haven't found them yet. So if you live in or about central New Jersey, I can give the thumbs up to this guy (my family has already bought about 5 cars from him and nothing unexpected has happened!)
Bob, The Auto Answer Man
Have a car care question? Visit our automotive center and see if we've already answered it or a similar question.
Also in Home
- 7 ways to save on carpet cleaning
- DIY pool maintenance
- How to use the home loan comparison calculator
- Saving money with home maintenance Video
- Easy oven cleaning without harsh chemicals
- Get rid of roaches safely
- 6 cheap, effective home security solutions
- 5 simple and affordable luxuries for your home
- 5 frugal ways to expand your living space
- Top 10 DIY mistakes made by home 'handymen'
- How spring cleaning can save you money
- 4 secrets to budgeting for a home purchase
- Find the best mortgage rates in your area
- 3 ways to use a mortgage calculator
- Mortgage calculator: Calculate your payment and more
- Home equity calculator: HELOC vs. line of credit
- Mortgage refinance break-even calculator
- How much money can I borrow for a mortgage?
- Who offers the most home insurance discounts?