Making the Switch

Making the Switch

Even if you take great care of your car, high-priced repairs become unavoidable as you put more and more mileage on your car each year. Should you keep repairing your car, or start looking at switching and purchasing a new one? Ask yourself these five questions before making your decision:

  1. How old is the car and how many miles does it have on it? Cars with more than 100,000 miles on them are much more likely to have mechanical problems than a newer car. Consider the kind of driving that you’ve done. If you’ve been driving in the winter on asphalt, you’ve probably done much more damage to your car due to salt and potholes.
  2. What type of insurance do you have? If your car is older, you may only have liability insurance, which means your premiums may be lower since the cost of replacing your car is less. If you purchase a new car (or a car that’s new to you), you will most likely need full insurance coverage and may be paying much higher premiums. Get a quote from your insurance company to know what you’re in for and to see the difference in insurance costs. Remember, as a member of Entrust, you receive discounts on auto insurance through TruStage. 
  3. How will gas consumption change? Compare your current car’s gas mileage with the gas mileage of other vehicles you might consider upgrading to. Use www.cudlautosmart.comfor consumer reports and research on different vehicles. Remember that that gas prices are high, so even if there is only a few miles per gallon difference, it could add up quickly over time.
  4. Do you have any warranties? Do you have a member service contract that covers some repairs and can save you money? Or a warranty on tires or other parts? If you have this, remember that this may be nontransferable. Find your paperwork to see what is covered on your current vehicle and what is not.
  5. How much are you currently spending on repairs and maintenance? Maintenance and repair costs are very much a part of owning a vehicle, so look back at the past year and see how much you’ve spent on your current vehicle. A few hundred dollars every three months is much less than most car payment plans. If you’re spending much more on repairs, ask yourself: How much life will this repair add to my vehicle?

By asking yourself these questions, you can calculate the best bang for your buck. If the cost of repairs is greater than either the value of your car or one year’s worth of monthly payments, it may be time to purchase a new one.

Decided to purchase a new (or new to you) vehicle? Take a look at our Top 10 Car Buying Tips.

Source: CUES, Accessed 8/28/14.