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Should you Keep your Car or Trade it in?

Tuesday, November 10 2015 2:41 PM
By Roger Scholfield
Should you Keep your Car or Trade it in?

At some point, every car owner faces the same dilemma: When is it time to trade in my old car for a new vehicle? Of course, the answer is different for everyone because there are so many financial and intangible factors to consider. Here are a few things to think about as you decide when to buy a new car.

Costs of repairing an old car

Repeated trips to the mechanic or a large repair bill can make you wonder if your old car is worth the investment. Every car needs regular maintenance, and there are wear and tear items like tires and brake pads that will need to be replaced from time to time. But, you shouldn’t have to worry about your old car refusing to start or leaving you stranded somewhere. If you’re continually pouring money into your old vehicle, a new car is worth considering.

Rather than being hit with unexpected repair bills, you could drive a newer, more reliable vehicle with a predictable monthly payment. New cars come with a warranty that covers major repairs, and some even include regular maintenance, which can save you more money. If you buy a used car, shopping at a dealership you trust and choosing a certified pre-owned vehicle are both ways to help ensure you get something reliable. Take a look at Scholfield's ProCertified Lifetime Warranty...

Gas mileage

Just like maintenance, fuel costs can add up and make owning an older car more expensive. Buying a new, more fuel-efficient car can save you hundreds of dollars each year on gas expenses. Check out the U.S. Department of Energy’s fuel cost and savings calculator to see how much you could save.

Insurance and registration

If you don’t have a payment for your old car, you probably don’t have full coverage insurance, so buying a newer car and taking out a loan on it would require you to carry comprehensive insurance. Although it would of course cost more, full coverage insurance also covers more in the event of an accident or other damage, like from storms. The title, tax and registration fees will be higher on a newer car, but generally it’s only a few dollars per month.

Monthly payment

Having a car payment is pretty typical now, but it’s important to think about how that monthly expense will be affected by your decision to trade or keep your current vehicle. For example, there are many lease options that can make it possible to drive a brand new car that’s still under full warranty with a much lower payment than purchasing the car new. Taking advantage of a low interest rate can also help you get into a newer vehicle for the same or even a lower monthly payment than what you have now.

If you owe substantially more than your car is worth, trading it in could leave you “upside down”, and with a higher payment even with a low interest rate. Generally, you’ll get more car for your money if you wait a year or two and pay down the balance on your current car, unless a dealership is offering incentives that can help offset your old loan balance.

Safety

There’s really no price tag that can be placed on peace of mind. Your old car may have dual airbags, but newer cars, trucks, minivans and SUVs are offering more standard safety features than ever before. For example, back-up cameras, blind spot monitoring and lane change assist are either an option or a standard feature on most Honda models now. For many people, the security of driving a safer vehicle is a desire that outweighs the extra costs involved. See Honda's standard safety features here...

Consider more than just the numbers

Realistically, deciding whether or not to buy a new car isn’t just a cost comparison. For most Americans, buying a new car is based on factors like reliability, comfort, safety, style and convenience, which are all priceless. The most important thing when you’re considering a new vehicle is to find a good deal on the best car for your needs and budget. Browse our new car inventory, and let the friendly Scholfield Honda sales team show you how affordable a new Honda can be.