Is Your Car Worth Repairing? Or Should You Replace It?

Should I Repair or Replace My Car?

Before we get into the numbers, it’s important to remember there’s always a spectrum when it comes to car repairs. Meaning the math can only show you so much—like whether you’re leaning more toward a repair or replacement. Other factors, such as repair frequency and what you owe on your car, come into play as well. Keep these in mind as you’re running your numbers.

Okay, time to get started. First, estimate the value of your car (without repairs). Sites like Kelley Blue Book or Edmunds are good examples of resources that can help you with your estimation.* Just for argument’s sake, let’s say it’s $5,000. And your estimated repair is $1,000. We’ll say for this example that the repair will bring the value of your car up to $6,000. That may not be the case in every situation, depending on the overall condition of your car and the type of repair. Your mechanic should be able to give you an idea of how much value your repair will add to your car.

So in this example, if you had to sell your car immediately after the repair, you’d still recoup the money you just put into it. In this case, you’re probably leaning more toward a repair. Now, if this is your commuter car and you’re getting to work late once a week thanks to a breakdown, it might be time to evaluate what these repairs are really costing you—in terms of headaches.

On the other hand, if that initial mechanic bill was closer to $2,000, and the value of the car increased to only $6,000 with the repair, you’re likely leaning toward selling the car and putting that money toward another car with your $7,000. That way, you’re essentially getting a better car for the same money.

Owe more on your car than it’s worth? Here’s what to do about your upside-down car.

If You Want the Fix: 6 Steps to Pay for Car Repairs

Decided to go ahead with the repair? Your next issue is paying for it—because it’s probably going to cost a not-so-nice chunk of change. But what if you don’t have the cash on hand to pay the bill? That’s okay. Here are six steps to finding the money you need to fund your repair:

Step 1: Shop around.

Don’t accept the first quote you’re handed.Get the initial diagnosis from a trusted dealership or a larger mechanic shop, but don’t assume their price is the price. The majority of your cost is probably not parts, but labor. And it’s almost always higher at larger, more established shops.

To find a reliable mechanic for a lower price, ask a few friends where they go for trustworthy work. Then call around to find the best price. While you’re on the phone, ask about any current discounts and specials they might offer too.

Step 2: What can you do yourself?

Maybe you need new brakes, but you also need to replace the door handle that came off this morning.Why not get the brakes fixed at the shop, and find an after-market replacement for your door handle online? Then watch a YouTube video and fix it yourself. Just be sure to follow the directions very carefully.

Step 3: What can wait?

If the estimated repair is still out of your comfort zone, ask the mechanic what needs to be fixed now and what can wait a few months. Don’t skip important safety features like brakes, tires and timing belts. But you can live without automatic windows for a while.

Step 4: Make a budget.

Let’s say you’ve lowered the repair price as much as possible. Now it’s time to find the cash to pay your bill. We recommend making a zero-based budget before you start overturning your couch cushions in search of loose change. You can make a budget in about 10 minutes with our favorite budget app, EveryDollar. It’s free, and it’s a way less labor-intensive than digging through your sofa.

Step 5: Move your money.

If you’re still coming up short, no problem. Simply dial your budget back in nonessential areas like restaurants, haircuts and new clothes. You can also divert your savings temporarily. And as a very last resort, you can use your emergency fund for absolutely necessary repairs. Just restock it as soon as possible.

Step 6: Budget for future repairs.

Ensure this issue doesn’t happen to you again by creating a line item in your budget for future car repairs and maintenance. That way, the money will be there waiting for you when you need it—and you will.