Wait Wait…Don’t Sell Me! How To Decide Whether to Keep Your Car

Posted by

Kenny Rogers said it: You gotta know when to hold ’em, know when to fold ’em.

You’ve had your car for a while and you’re at a crossroads. Maybe it’s purely financial, maybe it’s a question of maintenance, or maybe you’ve had a change in family status, but whatever the reason, you think your current vehicle isn’t cutting it any longer.

So how do you decide when it’s time to pull the trigger?

“I Hate This Stupid Car”

“I’m thinking about unloading my much-despised 2010 SUV,” my friend Julia wrote me a few months back. “It’s a vehicle I never would’ve chosen, but I let myself get strong-armed into it by an opportunistic and very talented salesman.” Not only was it unreliable, but Julia said she flat out never liked. it. “Not only is totally uninspiring to drive, but has a really crappy interior layout and lousy visibility and nowhere near the room that I would have liked. I don’t even like the color,” she said.

Find a Car You Don’t Hate at BestRide.com

The Argument for Keeping It
The biggest consideration for keeping a car you hate is financial. It’s almost guaranteed that you’re going to lose money in the transaction.

According to Chron.com, a good rule of thumb is that your brand-new car will lose 10 percent of its value the moment you sign the paperwork, and another ten by the end of the first year. Then, it will continue to lose 15 percent of its value per year, until it reaches 10 years of age, when it’s worth about 10 percent what the original MSRP was.

Factor in things like sales tax and more expensive insurance on a newer car, and getting yourself out of the car you hate can cost you thousands.

The Argument for Cutting it Loose

Well, you hate it. No matter how much money you’re going to lose, if you cringe every single time you write a check for your car payment, and you find yourself looking in the other direction to avoid seeing your car in a parking lot, nothing in the world is going to make it any better. Beyond basic transportation, your car should bring you some small bit of pleasure. If you can’t fix it with a new radio or a set of seat covers, something is drastically wrong with this relationship.

The Final Answer

If you’ll lose more money in therapist visits than you will on the transaction for a new car, get rid of that heap and get a car you love. Julia did. She’s now driving a Certified Pre-Owned crossover that meets her needs and makes her happy.

“Gas Prices Have Gone Up $1.35”

For the last couple of years, we’ve been enjoying historically low gasoline prices, especially when adjusted for inflation. Recent data shows that many Americans to jump into the same ginormous SUVs and pickups that were nailed to the showroom floor in 2008, when we were paying close to four bucks a gallon for gas.

You know as well as we do that gas prices are going to go up again, though, and as soon as they do, manufacturers will blow the dust off the EVs and hybrids languishing in showrooms, and charge a premium for anything that gets 50 miles per gallon-plus.

Find a More Fuel Efficient Car at BestRide.com

The Argument for Keeping It

The EPA makes this one pretty easy. If you navigate over to FuelEconomy.gov, there’s a handy cost calculator that will give you a pretty good estimate of your fuel cost savings per year, based on how many miles you drive.

Let’s say you’re driving one of America’s most popular cars, the 2013 Toyota Camry with a V-6, and you’re considering trading it on a 2017 Toyota Prius Three. At 15,000 miles per year, with gas prices set at a high $3.50 per gallon, you’d save about $1,100 per year in fuel costs.

But what’s it going to cost to get into a Prius? A 2013 Camry V-6 with average mileage is worth around $12,000. A 2017 Toyota Prius Three is $26,735. You’re spending $14,735 to save $1,100 a year in fuel, not including the sales tax, insurance, licensing fees and other associated costs with getting a new car. It would take 13 years to make up the difference in fuel cost between the Camry and the Prius.

The Argument for Getting Rid of It

Now let’s compare a 2013 Chevrolet Suburban with a 17 mpg combined average, versus a 2017 Toyota Prius, with a 52 mpg combined average. At a 15,000 mile per year average, with gas prices set at $3.50 per gallon, you’ll spend $2,100 more per year in fuel for the Suburban. Over five years, that’s $10,500. It’s a ton of money.

How about what it’s going to cost to flip the Suburban? Average trade-in value for a loaded 4WD Suburban is $32,462. Average value for a 2017 Toyota Prius Three is $26,735. On a good day, you could walk out of a transaction like that with a check in your pocket, and a savings of $2,100 per year in fuel cost

The Final Answer

It depends on the cars in question, the costs, the price of fuel and the market, but in general, swapping out an average car for a hybrid solely to save money in gas probably doesn’t make sense, while swapping out a true gas guzzler does.

“I Want To Get Rid of My Payments”

Car payments — most people will tell you — are as inevitable as death and taxes. If you plan on living further than bicycling distance from where you work, you’ll need a car. That need ramps up when you add kids to the mix. And if you’re going to have a car, few can afford to buy one outright, ergo, car payments are a way of life.

It doesn’t need to be that way, though. With some financial planning, you can pay cash for a car outright, and get yourself out from under the inscrutable bootheel of the credit industry. One way to get out of a payment is to sell your current vehicle on which you owe money, and get into one that you can buy for cash.

Get Rid of Your Car Payments at BestRide.com

The Argument For Keeping It

Two questions are going to make this decision easy: Do you have at least some equity in your current vehicle? Do you have a bit of cash to buy a decent, well-used automobile?

If you’ve answered “No” to one or both of these questions, you’re probably better off riding it out with your current vehicle, and putting aside some money when the value of your vehicle exceeds the amount you owe on it.

The Argument For Cutting It Loose

If you’ve answered yes to both, you’re on your way to a life without car payments. That doesn’t mean that you won’t be spending money on your car. Maintenance costs money, and it costs more money the older a car gets. But you won’t be writing a check to the bank for the privilege of having a car any longer. To get personal for a moment, the thing that allows my wife and I to blow all of our money on after-school programs and summer camps is the fact that we haven’t had car payments in years.

The Final Answer

If you can find a way to get yourself out of debt for your car, do it. It frees up your liquid cash for other things like vacations, dining out and replacing your water heater when it lets go all over your basement.

“My Transmission Went Belly Up”

Two common misconceptions to clear up: One, transmissions rarely fail these days. Two, if it does, the car is junk. We talked to Jim Clapham, who owns Clapham’s Automatic Transmission, Inc. in Fitchburg, Massachusetts. Jim’s father founded the business in 1951, and Jim started working alongside his father in the 1980s. He’s got 30 years of experience under his belt.

“Every transmission will eventually fail under extreme conditions,” says Jim. “This has been the busiest summer since I took over as manager.”

Deciding whether the investment in a rebuild or a replacement is worth it is dependent upon the cost of the repair and the value of the vehicle, with a few exceptions.

Replace Your Ailing Car at BestRide.com

The Argument for Keeping It

“When a GM 6L80 or a Ford 6R140 transmission fails,” says Jim, “it’s meant to be taken apart, rebuilt and put back into service.” That’s true of transmissions like the Honda H5 and H6 five- and six-speed transmissions, and many other automatic transmissions in popular vehicles. Replacement costs for a new transmission range in the $2,500 to $4,500 range, consisting of a remanufactured transmission and four to 9 hours of replacement time, at a rate between $450 and $850.

Expensive? Yes. But have you priced a new car lately? What kind of a car can you buy for $4,500? What would it cost to replace the car you’re driving with a new model, especially if you’re trading a car with a junk transmission?

The Argument for Cutting it Loose
Investing $4,500 in a car that’s only worth $3,000 on its best day seems like a waste of resources. At that point, a $3,000 with a bum trans would only be worth $1,400 on the open market, but a dealer looking to make a sale may be willing to offer you a fair trade at a better price on a new car.

There are also cars with transmissions that are notoriously difficult or expensive to replace. CVTs, for example, weren’t really meant to be rebuilt, just replaced and it can get costly.

The Final Answer

On any vehicle that has retained a fair amount of its value, a transmission replacement is a good investment. If it’s able to extend the life of your vehicle by another six years, that $4,500 only amounts to $62 a month.

“My Timing Belt Needs Replacement and it’s Going to Cost $1,400”

Engines once had their camshafts and crankshafts connected by a timing chain, and they virtually never needed to be replaced. You could run a Chevy small-block V-8 for 300,000 miles and the chain might be stretched, but breaking one was almost unheard of.

But timing chains are heavy and expensive, and they didn’t make the cut as manufacturers tried to make their vehicles as light as possible.

Now a timing belt is a maintenance item that requires replacement every 75,000 or so miles, depending on the manufacturer. The good news: The belt for an older Honda Civic is only about $77. The bad news, the labor and ancillary items to fix it can run up to $2,000.

Find a Vehicle with a Timing Chain at BestRide.com

The Argument for Keeping It

Replacing a timing belt is like replacing brakes and tires, and it’s about just as costly. But if you’re planning on keeping the car, a timing belt will put another 75,000 miles on the odometer before it needs to be replaced again. Because a lot of parts end up coming off to replace it (accessory drive belts, idler pulleys, hoses, water pumps, etc.), they all get inspected and replaced if necessary, meaning you’ve got a fresh start toward a lot more miles. Even in a high mileage car, a replaced timing belt is a selling point.

The Argument for Cutting it Loose

The sticker shock of a timing belt replacement is often due to deferred maintenance of other items. If you’re still running on your original belts and hoses at well beyond your timing belt replacement time, you’ve probably deferred a lot of other maintenance, too, and you may want to just roll it into the dealership and move it along.

If the timing belt has actually broken, you may well be in for catastrophically costly engine work. Cars with so called “interference engines” allow the pistons and valves to make contact when a timing belt breaks. Then you’ll need to decide whether a new engine is a worthy investment. The moral of the story? Change your timing belt.

The Final Answer
It’s always worth it to replace your timing belt, just like it’s worth it to replace your brakes. It’s the cost of owning a car.

“I Have A Hole In the Floor I Can See Through”

If you live in the dry southwest, you can look away now. The rest of the country — even some of the temperate regions in the southeast — still have to deal with rust. 100,000-mile outer body rust-through warranties have been the norm for decades, but as you’ll remember from Toyota’s recent history, rust attacks vehicles that weren’t adequately protected from the factory.

It’s not just unsightly; rust can be dangerous. Rot in rear quarter panels and the underlying structure can allow exhaust gases inside the passenger cabin. Rust in the floor and rocker panels — especially on a unibody vehicle — can cause damage to the vehicle’s safety structure. Rust on the frame of a body-on-frame vehicle can render it undriveable.

Find a Rust-Free Car at BestRide.com

The Argument for Keeping It

Rust — caught early enough — can be cosmetic, requiring not much more than a scuff and sand, some prep work and resprayed paint. Keeping your car clean will provide opportunities to see paint chips and rust as they start, so you can take corrective action before it gets out of hand. Especially on body-on-frame vehicles, replacements for rusted floors and rocker panels can be properly welded in place and the vehicle will be as good as new. Replacement fenders, doors and other panels often bolt right in place.

The Argument for Cutting it Loose

Unless you have some emotional attachment to the car, significant rust repair is probably too expensive to be worth it. If you’re driving the 1973 Pontiac Trans Am Super Duty you drove in high school and it needs new floors, by all means, seek out a professional restorer. For something mass-produced and relatively common like a Nissan XTerra, it’s probably worth considering just finding another one — preferably from a dry climate — because you’ll be into it for almost as much as the vehicle’s worth by the time you’re done with major rust repair and paint.

The Final Answer

Once major rust sets in where you can see it, it’s probably taken root somewhere else, too. Unless you’re emotionally attached, find another car.

“I Just Had a Baby and I Drive a Corvette”

You got out of college, got your first job and bought yourself a sweet Corvette for your daily commute and regular runs on the back roads. But you got married a year ago, and now you’ve got a baby on the way. Sure, your husband’s got a Camry, but the reality of parenthood is that both of you are going to be picking up or dropping off, and there’s going to be a time when that Camry’s in the shop and you need a vehicle that all three of you can squeeze inside.

Find a Sporty Car With A Back Seat at BestRide.com

The Argument for Keeping It

Just because you had a baby doesn’t mean your life of spirited driving is at an end. You’ll need to make some sacrifices, and it’s not going to be easy sometimes, but you can hang onto your fun car. One option is to keep it just for decent weather and the kid-free times you can enjoy it by picking up a cheap commuter. Really cheap. Like in the $3,000 or under range. That can be your mom car for most of the time, while the ‘Vette’s still around for when you’re alone.

The Argument for Cutting it Loose

The most critical decision is around safety, specifically regarding the age of the car and the advancement of its passenger-side airbags. Until the age of two, or when your child outweighs the limits of the car seat, The American Academy of Pediatrics recommends that she be in a rear-facing car seat. If your two-seat sports car is older and has airbags that can’t be disabled, then your child cannot ride in the passenger seat, no exceptions.

Even under the best of circumstances, it’s not advisable to allow a child — even in a front-facing car seat — to ride with an airbag in front of them. Most safety advocates recommend that children not only ride in a back seat, but in the middle position to be allowed the fullest crash protection.

The Final Answer

With a rear-facing car seat and an early airbag, your car isn’t safe for your child. Time to consider other options.

Check out vehicles near you with BestRide’s local search. Try it!


Craig Fitzgerald

Craig Fitzgerald

Writer, editor, lousy guitar player, dad. Content Marketing and Publication Manager at BestRide.com.