An older car has delivered on its value proposition, but when repair costs outweigh its market value, its time to consider selling. Getty
According to a recent study by IHS Markit, the average age of a vehicle on the road in the U.S. is now 12.1 years old. Thats a testament to the big improvements in quality from the cars of three or four decades ago, but vehicles still wear out and need repair.
Almost anything can be repaired or restored for a cost, but at some point, the economic equation of continuing to repair an aging vehicle just doesnt make sense for most drivers.
For a real-world example, consider the 2007 Volvo S60 seen below. This vehicle belonged to a family member who loved driving it. But after a decade of knocking around New York City streets, hard on any car, the bills for non-scheduled maintenance began to add up. One of the last was a $1,300 pair of suspension control armsa repair necessary to keep the S60 safe, but it was one of many bills in the final few years of ownership. Eventually, the cost of upkeep outweighed the value of the car, which was further reduced when it was sideswiped by a taxi. Finally, it was traded in.
You might really love your older car, like this 2007 Volvo S60, but there does come a point at which the expense of keeping it going just doesnt make sense. Keeping track of your expenses, expected repairs and the value of your vehicle can help you know when its time to move on. Alex Kwanten
Keeping your car a long time maximizes its value proposition, but there are some basic rules of thumb to keep in mind when making the judgment about how long, and how much, to keep investing in an aging vehicle:
- Know your vehicles value. If your car is worth around $4,000 on the open market, it probably doesnt make sense to put in a $2,500 transmission, particularly since you will likely have other maintenance needs in the near-term. But you can only make this call if you know how much vehicles like yours actually sell for.
- Know your model. The internet can tell you when your vehicle will need major services and how much they will cost. It can also give you some idea of how long your make and model typically lasts over time. Reliability indexes such as Dashboard-Light.com can give you an idea of the frequency and severity of repairs needed for most late model cars and their average lifespans in terms of total mileage driven.Model-specific forums, Facebook groups or subreddits as well as sites like RepairPal can also give you an idea of known trouble spots that might not be worth repairing and the associated costs. Forewarned is forearmed. If you know your $4,000 car has 125,000 miles on it and typically needs a $3,500 timing belt service at 140,000 miles, its a good time to think about selling.
- Avoid getting nickel-and-dimed. Keep a log book of exactly how much you spend on maintenance and what the items are. How much have you spent on vehicle maintenance in the last 18 months? Does it exceed the market value of your vehicle? If so, its time to think about a replacement. Similarly, divide it by 18. Thats how much youre spending every month to keep the vehicle.While the individual bills may not be as disastrous as the transmission cost in the previous bullet point, if your vehicle is frequently needing repairs, the continuing value proposition is poor and its better to sell it before bigger problems come along.
- What kinds of repairs has your car needed? Some repairs can be costly, such as timing belt replacement. Most vehicles will need a timing belt between 60,000 and 100,000 miles, but this is a normal preventative repair. The second such service, however, may come at a time when the cost outstrips the value of the car. Similarly, items like brake pads and tires wear out, so its normal to spend on them. But if youre having more substantive things repaired, like control arms, head gaskets, CV joints or transmissions, chances are good other things are worn out too.
- Watch out for rust. While rust isnt nearly as bad a problem as it was a generation ago, in some snowy climates its still common to see rust-rimmed cars less than a decade old. (Take heart, back in the 1980s it could be as little as three years.) Once you see rust, chances are theres more of it lurking where you cant see it, and it is virtually never worth repairing on a modern vehicle. Collision centers have largely stopped doing this kind of work as a result. A rusty vehicle usually isnt worth investing in from a mechanical repair standpoint, and the same is true of a vehicle with significant cosmetic damage.