Betsy, your trusted family car, is older than most of your children and you are now wondering if the time has come to part with her. This decision will depend on a number of criteria, so hopefully, the following questions will help you think this through.
Why am I considering selling her?
Did you catch car fever when you spotted your neighbor’s new car? NOT a good reason. Does she need a major repair? See discussion on repairs below. Has Betsy outlived her purpose? Do you need more room for your growing family? Do you no longer trust her? Why not?
Does driving a car with more than 100,000 miles on it make you uneasy? Thirty years ago, vehicles with 100,000 miles on them were usually worn out. However, today’s cars, with proper maintenance, are often reliable at 200,000 miles or more.
Obviously, some reasons are quite valid and some not so much . . . the important thing is that you clearly understand your reasons.
What are your options if you sell?
If replacing Betsy with a new car is your plan, that’s okay, but you should pay cash. On the other hand, If you are about to borrow $39,000 for a new car, along with the $619 monthly car payment (as some friends of mine recently did), you might need to reconsider.
If you think your can afford $619 payments, why not start paying yourself $619 every month for the next year? Yes, Betsy may break down occasionally, but $619 a month will pay for a lot of repairs. You should have a nice nest egg in a year, and my guess is that, after you have been paying yourself $619 a month, you will opt for paying cash for a used car instead of continuing to fork over huge payments for years to come on a new one.
Is Betsy a problem child?
I once had a 1996 Chrysler Town and Country van which ate transmissions. Fortunately for me, each transmission replacement was covered by a warranty, but when it happened the third time, I decided to fix it one last time and get rid of it. If you have a problem child, you know what I am talking about, and you should probably sell it.
How does she rate?
If you are curious about whether Betsy is apt to become a problem child, you can read both reliability ratings and customer reviews on Edmunds.com. However, keep in mind that you know your car; you have driven and maintained her, so be careful about letting someone else’s thoughts take precedence over your own knowledge.
Can you give her a new job description?
Perhaps Betsy’s years as your family car have run their course, but, if she is still in good repair, you may find great value in keeping her and re-defining her purpose. For example, if you commute to work, why not rack miles up on an older car instead of wearing out your primary car? Or, if you have one or more aspiring drivers, let Betsy become their learning – and driving – car. You may even want to turn her into a work car or a fishing car. You get the idea.
Does she need a major repair?
By major repair, I mean that you need to spend over $1,000 to make her run safely. The challenge at this point is to determine, even if you are ready to sell her, whether you would be better off making this repair first. Obviously, her market value is greatly diminished without the needed repair, so do your homework by getting a few repair quotes and then comparing her repaired value on KBB.com to that of her market value without the repair. If the difference is substantially more than the repair cost, you should make the repair.
Do you love the car?
I realize this is a subjective question, but it is nevertheless valid because – consciously or subconsciously – you will take better care of a car you love, meaning that if you decide to keep her, you will baby her and thus increase her life expectancy.
A Short Story
About two years ago, my beloved 1999 Cadillac DeVille d’Elegance needed major repairs and I was debating on whether to sell it or keep it. I loved the car, but, because of a head gasket issue, it needed an engine. After limping it around for a year (I couldn’t go out of town because it would overheat), I finally opted for a Jasper rebuilt engine at an installed cost of (gulp) $5,400. Today, I have had zero regrets. I had babied my Caddy for years, keeping it in nearly pristine condition, and now I plan to keep driving her far into the foreseeable future. Besides, that 3-year, 100,000 mile parts and labor warranty is sweet.
A Killer Question
Before selling your old car, ask yourself this question: “If I didn’t own this car, would I be willing to pay this much money to buy it?” For me, that question cinched my decision to repair and keep my Caddy. It also validated my desire to rid myself of my 1996 Town and Country.
Deciding whether to keep or sell your car is a big decision. Hopefully, all of these questions, along with the Killer Question, will help you make the decision which is right for you.
What other thoughts should go into the decision of keeping or selling your car? What good (or not so good) decisions have you made on your older cars? Leave a comment!
{ 15 comments… read them below or add one }
Hi, as pretty much always great article. I can tell you are serious about saving money. I admire that. But I have an old car and we were thinking about a new one. But if I hang on to it. I might could use that money to pay off debt or repairs. Hopefully. But I know one thing that saved me lately is having towing added on my ins. Betsy has broke down a couple of times recently. I was able to call enterprise and they came and picked me up from work and helped me get a car. Great service. But I had to get a wrecker. Broke down again and had to get a wrecker. So something to think about if you got an older car.
Good tip Tim…towing insurance can be a great thing, especially if you have an older car. I hope yours will hold together long enough for you to get those debts paid off!
Yes towing is good whe dealing with a mechanical nightmare.
Josh,
I hadn’t thought of buying a car in terms of trading the hours of your life for it, but I love the application. For someone who makes $39,000 a year, this would be the same as working an entire year for a car. Like you said, insanity!
Mr. Ford was good with 3 years income for a worker to purchase a car, it was his goal with the model t over a hundred years ago. If productivity advances had been half that of electronics cars would now by a couple months average wage, last 20 years, and get over 100 milse to the gal if even used fossil fuel at all. Thank the UAW and fed govt for what you can pick from now.
Henry Ford Mseum was my favorite place when I was 5 years old. My first school field trip was there.
My wife and I decided years ago to never buy a brand new car again. We made the mistake of buying two new cars, 1 year apart, in our second year of marriage. Now, 28 years later, we buy only used vehicles. Of course it helps that I can do most maintenance on my own cars. You are very correct in that vehicles at 100,000 miles can have a lot of life yet. We just purchased a used car with 107,000 miles on it and the previous owner had been faithfully having the car serviced at the dealer. It’s a 2001 model but looks and rides great and only cost us $5000. It can be done if you find the right vehicle. Like Josh said above, I too would rather focus on the being and doing rather than the having. I look around and see a lot of new cars out there on the road. Yeah, the new cars look and smell nice but the debt – not so nice.
Dave –You remind me of me. We made those same new car mistakes years ago, but we, like you, learned our lesson. Our newest car is a 2000 model we bought two years ago for $5200. It had 103,000 miles on it at the time and it still runs like a dream.
Cherleen — I love your plan, not only saving so you can buy a new car without debt, but including your kids in the decision. What a great way to teach them about handling money and avoiding debt. Voila! Responsible children!
It was less than 40 years from steam engine to combustion. Combustion is now over 100 YEARS OLD! This stagnation is what happens with an over regulated, over socialized, industry. Stop the bail outs, unions, and market protectionism and we will finaly see inovation again. If 100 years doesn’t prove what doesn’t work then you are a socialists and like all socialists denial of truth is a constant.
For me it’s got to be keep the car for as long as you possibly can, even if it means paying for major repairs. For example, if your transmission cost $2000, considering that an average new car payment would be between $300-500 (guessing) then the transmission replacement was effectively paid for within four to seven months, which isn’t long when it comes to the lifespan of a car. Granted, there are cars that are occasional junkers but if you’ve kept it for a long time then chances are it’s probably not.
There is no exceptable stratigy when it comes to transportation now available to the cosumer market. To many moving parts and expensive systems with constant failing and replacement of support parts ie; starters, sensors, computer systems, radiators, fuel pumps, oil pumps, on and on and on it never stops. Take note that an electric motor has ONE moving part and NO support parts needed, not even a transmission. There is a reason modern train engines primary drive is a DC electric motor with energy supplied by a diesel driven generator. Electric motor is much higher torque than any diesel and from 0 rpm. Note HP = rpm x torque. Lastly, that train drive can ship a ton of frieght over a mile with less than one gal of fuel. With the lower technology combustion engine running at a constant rpm at peak performance the more durable electric does all the hard work. Semi trucks should have been available in this configuration in the 1950′s but yet we still only use a variable rpm combustion ( deisel ) at great loss of effiecency and a very expensive transmission or it wouldn’t work at all. This AINT rocket sceince its just not available because any new start up manufacture is beatin down by govt regulation and unionized ogopoly. To many progressives now dominate both parties to ever see the idiocy end.
We left Michigan in the 1980s for a reason, just couldn’t take the ignorance.
Californians have overwhelmed Colorado so we are headed for Texas and yes I will wear the grey if it comes to that.
No car for us, no thanks. Walking distance to work, by choice, and goods we get delivered. Lastly when we need to drive out of town we rent. Yes cost per hour of use is greater but total yealy costs are pennies on the dollar. The best part is all the tax money we save and even better govt doesn’t get. Auto ownership for most mid income families is the largest tax liabilty they have when considering ALL related costs and attached taxation. Its like the land line phone comapany I fired, a 13 dollar phone bill with 17 bucks in taxes and other various excuses dreamed up late at night by over paid, under worked, politicians. No thanks we will pass. Hows it working out for you? You aint gotta put up with it you know.