A question I hear from customers often is, “Is it even worth it to fix it?” My answer is always the same: “It depends.” This answer is even accurate for customer who need major repairs like an engine or transmission. This answer is the SAME even if the customer needs an engine for a 1980s Honda…it depends.
The real question you need to ask yourself is, “What is my goal with this vehicle?” Most people claim that they just want something to get them from “point A to point B,” but the facts show us that car buying is largely an emotional decision.
But this post is about being in the moment where you have to decide what to do with your car, not deciding which car to buy. Keep in mind some of the following costs associated with replacing your car: sales tax, dealer fees, registration fees, loan interest, state inspections, new insurance premiums (could be higher or lower), new phone mount or other personal accessories, time off work and transportation to look for another car and finally whatever needed maintenance the “new” car needs.
If you're buying a NEW car, you can shave off that last item about maintenance and add the following costs: depreciation, depreciation, and depreciation. Did I mention depreciation? Also, you can't be surprised when you find yourself back at the dealer for recalls and warranty repairs. All cars break…even new ones. You can come out ahead buying a new car ONLY if you plan to keep the car for a LONG time. If you want to change cars every few years, you're better off leasing or sticking to used vehicles.
Now that you've read about the costs of purchasing a new car, remember that you don't get that money back. The value of the car is in what it can give back to you. How will a dealer document fee ever pay itself back?
Come back on Monday for more.