How long can you realistically keep a car?
How Long Should I Keep My Car?
According to the automotive research firm iSeeCars.com, the average length of car ownership for the top ten models ranges from 9.7 to 11.4 years – or 14.9% to 35% longer than the overall average of 8.4 years.
«While the average new car buyer holds onto their car for 8.4 years, there is a wide variety of cars that owners are more likely to keep longer,» said iSeeCars CEO Phong Ly. «Sports cars typically aren’t daily drivers and don’t accrue high mileage as a result, so it takes them longer to show signs of wear and tear.» (Excerpt from iSeeCars).
In most cases, a car is an asset that quickly succumbs to depreciation. It is worth less with each driven mile, and spending money on something that is only decreasing in value doesn’t make sense for long periods.
However, if you can look past the depreciation factor, today’s modern cars are built to last longer, thanks to new designs and technological improvements. So, cars are lasting longer than they did before. Automakers are also backing up their productions with a warranty, which helps you with the maintenance costs for a specific period.
The average person does not keep their current car for much longer than ten years, although a report in Car and Driver notes that people keep their vehicles longer now than ever before.
Many car owners trade in their older car for a newer model or a newer car altogether, not because the vehicle has seen the end of its lifespan but instead taking advantage of new technology and safety features.
Every vehicle owner faces a choice at some point to get rid of their existing car, but when is it the right time? If you are in the hot seat now asking, «how long should I keep my car?» the answer depends on the vehicle itself and its current condition. It also depends partly on your preferences, priorities, and affordability to keep up with the repairs and maintenance.
Today, modern vehicles typically last longer than vehicles manufactured ten years ago. Like Honda and Toyota, some makes are well-known for going the distance with excellent reliability scores. However, even the most reliable makes and models of cars have a lifespan and eventually develop significant problems that lead to expensive repairs.
The cost to keep your current vehicle running may determine whether it’s time to go car shopping for a new car. Continue reading if you want to know how long to keep a car and what factors are worth considering before getting rid of your old car.
Below is a list of America’s most popular cars and the average length of ownership before resale:
- Ford Explorer (9.6 years)
- Toyota Camry (9.5 years)
- Honda Accord (9.4 years)
- Toyota Highlander (9.1 years)
- Honda Civic (9.1 years)
- Jeep Grand Cherokee (9 years)
- Toyota Corolla (9 years)
- Toyota Tacoma (9 years)
- Jeep Wrangler (8.9 years)
- Ram Pickup 1500 (8.7 years)
- Honda CR-V (8.6 years)
- Chevrolet Silverado 1500 (8.6 years)
The vehicle which car owners have kept the longest is the Toyota Land Cruiser at 11.4 years before resale. The Chevy Corvette follows with 10.5 years.
How Long Should I Keep My Car?
So, when exactly is the right time to let go of your current car and move on to your next set of wheels?
Below are three factors worth considering:
1. The Cost of Ownership
When considering whether or not to trade in your car for a new vehicle, weigh up the costs of driving your current vehicle for one year.
Factor in the following expenses:
- Regular maintenance costs and oil changes
- General repairs
- Car insurance costs
Draw a line in the sand by establishing a set dollar amount that would necessitate when it’s time for another car.
When a new vehicle makes sense:
- It doesn’t make sense to pay $3,000 for a car repair when your car is only worth $2,000. According to the AAA, if you drive the current average of 15,000 miles per year, you should generally expect to pay about 61.88 cents per mile in various maintenance and repair costs.
- If the maintenance costs exceed the vehicle’s value.
- As cars rack up more miles on the odometer, they typically become less fuel-efficient. If your older car gets 20 miles a gallon, but a newer car gets 35 miles. The savings here alone may encourage your move to a newer car.
- Compare your current auto insurance costs for your old car versus a new car. In this instance, you may find newer cars and cars with an auto loan have higher insurance costs.
2. Your Financial Situation
Now that you have weighed up the cost of ownership for your current car versus a newer car, you need to establish what finances you have at your disposal to either keep your current vehicle running or trade it in for something newer.
Suppose you do not have any discretionary income available to keep your current car safely on the road but still need another vehicle. In that case, you may need to borrow from a credit institution. If you require an auto loan after paying off your current car, you’re essentially signing up to make monthly payments forever. Not only that, but pricing (and your car payments) are likely to be higher on a new vehicle versus your old one. On the upside, you could possibly use your old car as a down payment for the new one.
You have three options available for your next car; buy a lightly used car, buy a new car or lease a new car. These options are all ideal for someone who has lucrative funds available to purchase a car with cash or someone who has a strong credit record for a car loan or lease. Before you start the car buying process with the intention of needing an auto loan, check your credit report first, so you know exactly where you stand.
If finances dictate buying a heavily used car, you may risk receiving an unknown repair bill, in which case, you are better off dealing with the known repairs of your current vehicle. The moment you conclude your vehicle is worth nothing monetarily but still valuable to your financial situation, then you need to create a budget or savings plan to get it back to where it should be aesthetically and mechanically.
3. Safety Factor
For some, replacing a functioning vehicle can be traced to exhibiting a successful lifestyle; for others, it’s all about safety. There is no doubt that today’s modern cars are some of the safest on the roads because of their long list of active safety features. There was a time when having airbags alone made a vehicle a safe choice. These days, airbags are standard and can be found in multiple locations inside a car.
Following the evolution of airbags is the development of driver assistance and safety features, for example:
- Adaptive headlights
- Automated parking
- Autonomous braking
- Backup cameras and sensors
- Blind-spot monitoring
- Lane-departure warnings
Some safety features reward you with car insurance discounts, thus lowering your cost of ownership.
Depending on your car’s model year, replacing it with a newer model may provide you and your family with a safer driving experience and added peace of mind.
Is It Time to Get Rid of Your Car?
As you can see, many factors determine whether or not to get rid of your car or hold onto it a little longer. If your car is old and requires significant repairs that will cost more than the car’s Blue Book Value, then it might be time to say goodbye.
Likewise, if your car is starting to rust or is unreliable despite repairing it, or if it was involved in a severe accident, fire, or flood, then a newer model may be in your future.
What Affects a Vehicle’s Lifespan?
If you’re asking, «How long should I keep my car?» it may be helpful to think about the factors that affect your vehicle’s longevity. Several things affect how long your car will last, including:
The environment you live in and the weather conditions. Some environmental conditions are better than others; for example, a temperate climate is better than an extremely hot or cold one. Some weather conditions also promote rust.
Your average driving conditions and how you drive and use your car. Applications like towing heavy loads, revving the engine past its redline, or driving at top speed for long periods, repeated extreme acceleration and deceleration could all decrease how long an engine lasts.
Whether your car is parked in a garage or outside, a garaged vehicle typically wears less than one kept outside.
The average miles you drive. Highway miles are typically better than stop-and-go city miles, and a car that doesn’t get driven as much will have less wear and tear.
How well you maintain your vehicle. Any vehicle with regular maintenance and oil changes stands a better chance of having a long life.
The make and model of the car (some have higher reliability and dependability scores than others). Long-lasting vehicles tend to come with higher resale values.
I Want to Keep my Current Car
If you have decided to embrace the longevity of your car, then you need to preserve it for as long as possible.
The most consistently reliable way to keep your car running is to do regular maintenance. That includes oil changes, not driving on worn tires, changing fluids when they get old or dirty, cleaning the interior and exterior regularly, and changing the air filter. Every make and model has recommended maintenance intervals to help you determine what needs to be performed and when. Keeping up with maintenance alone can allow any car to remain on the road longer.
You also need to consider your driving habits. Driving aggressively, in adverse conditions, or off-road can all shorten the life of your vehicle. If you drive like this regularly, you can expect more maintenance costs.
I Want to Buy Another Car
If buying another car and ditching the old car is the way to go, then some features to keep in mind include automatic emergency braking, blind-spot monitoring, and forward-collision warning. Electronic stability control and rear cameras are also worth seeking out, although they’re now required on new cars sold in the U.S.
When car buying, make sure to research any prospective vehicle for crash test results and reliability ratings. When you’re looking at older cars, things get a bit more complicated. At that point, you’ll want to look at vehicle history reports using the VIN.
If you have limited mechanical knowledge, you’ll want it checked by a professional mechanic. At the very least, take it for a test drive and look for leaks, signs of water damage, paint overspray, and corrosion.
From a safety standpoint, cars rated Top Safety Pick+ by the Insurance Institute for Highway Safety (IIHS) are invariably an intelligent choice. The IIHS is widely regarded throughout the automotive industry for its safety rankings. Like Consumer Reports, they compile an annual ranking of the safest cars based on size and class and the safest SUVs and vans.
Thoroughly research prospective vehicles and weigh their resale values, ownership costs, and fuel efficiency. If a newer car will cost you more to replace your current functional vehicle, is it really worth it if you are on a tight budget?
Cars That Last Longer
Replace your current car with one that has an excellent track record for lasting long, i.e., a vehicle with great reliability scores. However, with proper maintenance habits, you can probably get nearly 200,000 miles or more on just about any car.
Consumer Reports releases an annual list of the most reliable cars, trucks, and SUVs for each model year. Consumer Reports arrives at its rankings based on recent vehicle performance data provided by more than 300K vehicle owners. The vehicles on the list are those whose owners reported the least problems in the previous year.
According to Consumer Reports, here is a list of the most reliable car brands for 2022:
According to Consumer Reports, here is a list of the most reliable cars for 2022:
- Toyota Prius
- Lexus NX
- Buick Encore
- Lexus GX
- Honda HR-V
- Toyota Prius Prime
- Hyundai Kona
- Audi A5
- Audi A4
- Mazda CX-5
8 simple ways to save money
Sometimes the hardest thing about saving money is just getting started. This step-by-step guide can help you develop a simple and realistic strategy, so that you can save for all your short- and long-term goals.
Record your expenses
The first step to start saving money is figuring out how much you spend. Keep track of all your expenses—that means every coffee, household item and cash tip as well as regular monthly bills. Record your expenses however is easiest for you—a pencil and paper, a simple spreadsheet or a free online spending tracker or app. Once you have your data, organize the numbers by categories, such as gas, groceries and mortgage, and total each amount. Use your credit card and bank statements to make sure you’ve included everything.
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Bank of America clients can access the Spending & Budgeting tool in Mobile and Online Banking to automatically categorize transactions for easier budgeting.
Include saving in your budget
Now that you know what you spend in a month, you can begin to create a budget . Your budget should show what your expenses are relative to your income, so that you can plan your spending and limit overspending. Be sure to factor in expenses that occur regularly but not every month, such as car maintenance. Include a savings category in your budget and aim to save an amount that initially feels comfortable to you. Plan on eventually increasing your savings by up to 15 to 20 percent of your income.
Find ways to cut spending
If you can’t save as much as you’d like, it might be time to cut back on expenses. Identify nonessentials, such as entertainment and dining out, that you can spend less on. Look for ways to save on your fixed monthly expenses , such as your car insurance or cell phone plan, as well. Other ideas for trimming everyday expenses include:
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Search for free activities
Use resources, such as community event listings, to find free or low-cost entertainment.
Review recurring charges
Cancel subscriptions and memberships you don’t use—especially if they renew automatically.
Examine the cost of eating out vs. cooking at home
Plan to eat most of your meals at home, and research local restaurant deals for nights that you want to treat yourself.
Wait before you buy
When tempted by a nonessential purchase, wait a few days. You may realize the item was something you wanted rather than needed—and you can develop a plan to save for it.
Set savings goals
One of the best ways to save money is to set a goal . Start by thinking about what you might want to save for—both in the short term (one to three years) and the long term (four or more years). Then estimate how much money you’ll need and how long it might take you to save it.
Common short-term goals: Emergency fund (three to nine months of living expenses), vacation or down payment for a car
Common long-term goals: Down payment on a home or a remodeling project, your child’s education or retirement
Set a small, achievable short-term goal for something that’s fun and goes beyond your monthly budget, such as a new smartphone or holiday gifts. Reaching smaller goals—and enjoying the reward you’ve saved for—can give you a psychological boost, making the payoff of saving more immediate and reinforces the habit.
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Determine your financial priorities
After your expenses and income, your goals are likely to have the biggest impact on how you allocate your savings. For example, if you know you’re going to need to replace your car in the near future, you could start putting away money for one now. But be sure to remember long-term goals—it’s important that planning for retirement doesn’t take a back seat to shorter-term needs. Learning how to prioritize your savings goals can give you a clear idea of how to allocate your savings.
Pick the right tools
There are many savings and investment accounts suitable for short- and long-term goals. And you don’t have to pick just one. Look carefully at all the options and consider balance minimums, fees, interest rates, risk and how soon you’ll need the money so you can choose the mix that will help you best save for your goals.
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If you’ll need the money soon or need to be able to access it quickly, consider using these FDIC-insured deposit accounts:
- A savings account
- A certificate of deposit (CD) , which locks in your money for a fixed period of time at a rate that is typically higher than that of a savings account
If you’re saving for retirement or your child’s education, consider:
- FDIC-insured individual retirement accounts (IRAs) or 529 plans, which are tax-efficient savings accounts
- Securities, such as stocks or mutual funds. These investment products are available through investment accounts with a broker-dealer 1
Make saving automatic
Almost all banks offer automated transfers between your checking and savings accounts. You can choose when, how much and where to transfer money or even split your direct deposit so that a portion of every paycheck goes directly into your savings account. The advantage: You don’t have to think about it, and you’re less likely to spend the money instead. Other easy savings tools include credit card rewards and spare change programs, which round up transactions to the nearest dollar and transfer the difference into a savings or investment account.
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With Mobile & Online Banking, Bank of America clients can easily set up automatic transfers between accounts.
Watch your savings grow
Review your budget and check your progress every month. That will help you not only stick to your personal savings plan, but also identify and fix problems quickly. Understanding how to save money may even inspire you to find more ways to save and hit your goals faster.
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1 Remember that securities are not insured by the FDIC, are not deposits or other obligations of a bank and are not guaranteed by a bank. They are subject to investment risks, including the possible loss of your principal.
The material provided on this website is for informational use only and is not intended for financial, tax or investment advice. Bank of America and/or its affiliates, and Khan Academy, assume no liability for any loss or damage resulting from one’s reliance on the material provided. Please also note that such material is not updated regularly and that some of the information may not therefore be current. Consult with your own financial professional and tax advisor when making decisions regarding your financial situation.
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