I knew it.
I just knew my car was in bad shape. I’ve talked about it before, and I knew it was going to happen. One of our cars, the one that the whole family can fit into comfortably, is going to need a new transmission.
It’s not yet at the point where we need to replace the transmission tomorrow, but we need to start thinking about what to do. The mechanic delivered the bad news last Wednesday.
“Just for laughs,” I said. “Tell me how much it will cost to replace the transmission.”
He fiddled with the computer for a few minutes. Meanwhile I was setting limits in my head. “If it’s €1,000, that’s OK. We have that much in the emergency fund. If it’s €1,500, then we’ll need to scrimp and put it off for a few months until we have that saved too. But we can do it.”
He looked up. “€2,500.”
Ouch.
“For the part,” he continued. “It will take about eight or nine hours to do, and with labor, you’re looking at about €4,000.”
We don’t have €4,000. Not only that, but we won’t get approved for a loan, because my income has dropped so drastically now that I’m in school. If we need to lay out that sum of money, it’s going to have to be through tapping the open line of credit at a gazillion percent interest. I can’t tell you how NOT thrilled I am at the prospect of doing that. It feels like we’ve been making lots of progress since we paid that bill off, and borrowing money would only be taking us back in the wrong direction.
The thing is that we need to have two cars. Even though we don’t drive them far, we do need them for my husband to get to work and for transporting the kids back and forth to school and the nanny’s. And, as good as public transportation is in France, for those two locations it is unfortunately not an option.
For the moment we’re sitting tight. We still haven’t decided whether or not to repair it, or if we should bite the bullet and buy a new (to us) car. There are pros and cons for both, and the decision certainly isn’t easy.
What do you think? What would you do?
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{ 12 comments }
It’s no fun getting into this position, but I think we all get there at some time. Not knowing all the specifics of your car, it’s hard to advise you. I just wanted to ask, is it possible to sell anything? We’re in the middle of dumping our extraneous crap on craigslist….
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I don’t know the price of used cars in France but I’m guessing 4000 euro would go a long way towards purchasing one. That seems like a better option. Maybe you could sell your current car and use some of that money for purchasing a new one.
The only way I’d consider making the repair is if you feel that is the last major repair the car will need for a long time and it has been otherwise reliable until now. My car has been very reliable but I wouldn’t spend that much money to fix it because it has so many miles on it.
Andy´s last blog post..Could I Retire Now?
Set yourself a repair limit & look at the other parts of the car to figure out if it is going to become even more costly…I bought a good used car (honda) and make it last until it becomes a money pit, having said that it hasn’t happened yet. But when it does I’d try to move on.
Frugal Trenches´s last blog post..Signs you’ve simplified and mentally downshifted
wow, such a predicament! I just posted a story about our car trouble this week on my blog. I think, for that amount of money, and the fact that you do need 2 cars, you may just want to look around for a new-to-you car. Besides, the transmission, has this car been reliable, or have you had a few issues with it? If it’s been pretty reliable, then that may be a harder choice. You take a gamble getting another car that you have never used and are not used to, but sometimes those types of risks are a lot better than getting back into debt. I guess that’s what emergency funds are for. My vote, look at a few used cars and see what your options are besides building up more debt.
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Man that is such a crappy situation. We had our car go out earlier this year, and the cost of repair was going to be as much, if not more, than the car was worth. If this is your situation, you might just want a new to you car.
If you have a little while longer to decide, start looking for “new” cars now so when you need to either repair or replace you have options.
I hope everything works out!
Lucie @ Unconventional Origins´s last blog post..Raising Conscious Children: Using the Ugliness of the Campaign Season to Teach Your Children Tolerance
Thanks everyone for the advice. A little bit more information: the car is 8 years old and has about 105,000 km. The utmost limit we could expect to get to is about 200,000 km. It’s bluebook value is about €4000, but with all the dings it came with (or I put into it, cough cough) it’s probably worth a bit less than that. So you see that the repair costs would be at least the value of the car.
It’s been fairly reliable so far, but we have had to put some money into it already. It’s also getting to the point where we are going to need to replace some routine things.
I’ve given some thought as to how we could do without this car and it would involve moving or changing our kids’ school, and that isn’t an option.
We could find a good car for us for about €6000 (I’ve seen quite a few for sale recently) with few kilometers and a bit smaller and more fuel efficient. We would come out ahead of repairing the other and selling it instead, on the other hand I don’t know if I can handle another thing on my plate right now!
Ouch…not a fun situation. Is there any sort of carpooling options available at your kids school?
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Hi Kelly, You know that the Tightwad Gazette would say you don’t need two cars if you stay home. Or get a sitter near home or on the bus line and take internet courses. It’s these tragic monetary things that make us reevaluate. I’ve had this same car dilemma way too many times. Even though we can afford it we never buy new cars anymore, always late model used (see The Millionaire Next Door). Don’t sink another dime into this one. I put an expensive transmission into a Renault once and two days later the engine died. Someone just told me my career would restart when the big yellow bus pulls up, and I’m starting to think that’s true. Two cars, au pair, clothes, all add up. Goo0d luck.
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@Lisa, yeah, except that my kids need to get to school and my husband needs to get to work. And he can’t arrange his hours to pick them up every afternoon, and we can’t do without his salary, so we need the second car.
Life would be much easier if we could only have one car, but we can’t. Hence the dilemma!
Ouch…
I guess I’d be a new car but I can see it’s a difficult decision. Same goes — to a lesser extend — with computer. Last time mine broke, I bought a new one cause it was cheaper.
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Oh no – transmissions are so expensive!
I’d say get a new car, but I’m sure you could get an ok one for less than 6,000 euros.
Mind you, as you may recall from this post – http://www.miss-thrifty.co.uk/2008/09/01/introducing-the-thriftymobile/ – I’m a notorious tightwad when it comes to cars!
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The tipping point for me is when the cost of the repair is more than the value of the car. It looks like you are there. AND the cost of the new to you car less your trade in looks like it will be less than the cost of the transmission repair.
Your financing % on a used car will probably be less than on your credit card or line of credit. Right now my credit union is between 5.25 and 7.5 % depending on the age of the car and the length of the loan.
But yeah, taking on debt when you just finally got out from under is frustrating. Best of luck