Economics of retaining an older car, versus a buying a new car

Just factor a rental into the repair estimates. But as I said, it has been very reliable. It has had unexpected repairs only once in 13 years. Everything else could be scheduled.

You had originally suggested 2 years.

Notice that, in your example, the value of the car only shows up as reducing the net cost of buying the new one. It really has no effect on the fix or replace question.

A couple of other points. One is that $5,000 Explorer is only going to be 3 or

4 years newer than my $1,500 Explorer. You're going be back on the high maintenance curve before you've broken even.

Another is that you only do essential maintenance (including essential preventative maintenance) on cars of this age. Once you have been presented with a $750 repair estimate, the value of the car declines by $750 until you fix it. The alternative is to foist it off on some unsuspecting buyer.

-- Doug

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Reply to
Douglas Johnson
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I was just repeating something I'd heard in a business setting years earlier. Even if the math is a more complicated than I implied at first, I still think it *sounds* like a really solid and easy rule! ;-)

Well, what does then? The older the car, the harder parts are to get, and the less likely you are to find a mechanic intimately familiar with the model and year. Some cars are so old (yet less than twenty years) that even when operating to manufacturer specs, they don't pass modern smog laws in some states.

I'm still claiming there must be *some* point when repair costs accelerate for an older car. Since older cars (excluding collectibles) are cheaper, then there would be a strong inverse correlation between the value of the car and annual repair costs.

To tie this back to financial planning and the OP, I got three things out of his message: older car (14 years), high mileage (180K), and peeling paint. What we don't know, although some hints were given, is the role this car plays in sustaining his (family's) earning capacity, and what the condition of non-essential systems (air conditioning, sound, safety/security, interior coverings and finishes) are. If he lives in the snow belt, there's sure to be some rust by now.

With those conditions, I'm still advising that after ten years, let's say fifteen max, it makes sense to buy a newer used car, say in the five-year old range, and plan to then keep it for another ten years or so. Others have suggested keeping it for another five years, never selling it, and at least one other suggestion to trade in a for a newER (not brand new) vehicle.

-Mark Bole

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Reply to
Mark Bole

And no matter the source, 15,9375,000 BTUs of energy is 15,9375,000 BTUs of energy. Personally, I expect that a car's construction uses considerably more energy than that, but I don't have access to the source data to see what they might have missed.

BTW, according to

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a car's construction uses over 1,000 gallons of oil, not gas.

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Reply to
Daniel T.

The first item on your list is the only viable one, and only for vehicles that are unusual. Honda Civics, even 10-15 year old ones, are quite common. (Almost 40% of the cars in service in the USA are over 10 years old.) It is generally easier to find a mechanic familiar with an older car, after all most of them learn their trade on older vehicles! As for the smog laws, older cars get grandfathered in so the laws don't apply to them anyway.

In other words, the suggestions on this group have been all over the map. :-)

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Reply to
Daniel T.

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