Many of us own older vehicles, whether it’s because we have a passion for old car models or our budget just doesn’t allow a newer upgrade. But, at some point, that familiarity and loyalty we feel can turn into worry and dread about the next repair bill.

It’s an unfortunate truth, but when cars reach a certain age or mileage, a combination of wear-and-tear and how well they’ve been looked after (or not) means they may require more repairs and maintenance as they age and accumulate mileage.

So when your repair shop hands you an estimate in the thousands, it’s time to consider your options:

• Do you keep your trusty(-ish) companion, knowing you’re in for more frequent maintenance and repair bills?
• Do you throw in the towel and trade it in for a newer, more reliable vehicle?
• Or do you donate it and use the tax deduction to help pay for a replacement vehicle?

Buying and running a vehicle is one of the biggest expenditures for most people, so with these sorts of decisions, it’s best to leave your gut instinct out of them and instead weigh up the costs of your options.

Well, we’ve done some example math, so you don’t have to. Below, we’ll help guide you through the decision step by step.

Option 1: Trade In Your Old Car

If you’re leaning toward replacing an old vehicle, one option is to trade it in. Going down this path can make sense in certain circumstances and subsidize the cost of a new vehicle. Of course, whether it’s worth it or not comes down to one thing: how much can you get for it?

Dealers calculate the trade-in value by looking at prices in the current market, but the dealership is looking at wholesale prices rather than retail prices, so they’ll automatically be lower than those you’re used to seeing.

Trade-in price factors include:

• Current market prices: Many people find trade-in offers for used cars disappointing. This has especially been the case in the last few years, as used car prices have come down following the post-pandemic spike.
• The age of the vehicle: A new car starts to depreciate from the moment you drive it off the lot. Cars that aren’t considered classics or collectibles almost always continue to depreciate as they age.
• The mileage of the vehicle: If your vehicle has done well over the average 13,500 miles a year, it will have suffered more wear and tear, and this will affect its resale price.
• The maintenance record of the vehicle: Dealers will pay more for cars that have been well looked after. That means documented maintenance in line with the schedule in the owner’s manual.
• The condition of the vehicle: Dealers assess the health of your car and its parts so they can factor in any reconditioning costs. If your car needs major repairs, or even just lots of minor cosmetic fixes, the trade-in price will be lower.

So, when does it make sense to trade in your vehicle?

If you own the car outright, then it’s simply a matter of seeing what the trade-in value could give you to work with in terms of budget for your new vehicle, and weighing up their pros and cons, including their reliability credentials.

If you have outstanding motor finance payments on your vehicle, then you need to see if the trade-in value is higher than what you owe. If it exceeds the balance on your loan, you can use this equity to help fund your new car purchase.

When shouldn’t you trade in your car? Trading in your old car doesn’t make financial sense when the trade-in value is less than the loan payoff amount. You’d just be compounding the issue by rolling your negative equity into the new loan.

Option 2: Donate Your Old Car

If you want to replace your car but a trade-in doesn’t make sense for you, another option to consider is donating it to charity. There are several benefits of a car donation:

• You can support a worthwhile cause. For example, through our Endurance Cares initiative, we partner with Cars of Hope, a not-for-profit dedicated to repairing and donating cars to under-resourced families in the Chicagoland area.
• It’s usually a quick process, meaning you won’t be stuck with the hassle of keeping your vehicle on the driveway while you sell it.
• Often, you can even donate vehicles requiring major repairs.
• You don’t incur any costs, with charities often taking care of collecting the vehicle for free.
• You may be eligible for a tax deduction or other tax benefit.

However, it’s important to note that donating a vehicle doesn’t automatically translate to a tax deduction for you. If the charity sells the vehicle, the deduction you’re eligible for will be limited to the actual sale price, rather than the Kelley Blue Book value.

If your vehicle has…

• High market value: The tax deduction could be significant and make a donation worthwhile. However, you should also consider your marginal tax rate and whether the deduction would be worth more than what you’d get for selling the car to a private party.
• Low market value: It is unlikely to be sold by the charity for an amount that would produce a meaningful tax deduction, but a donation could still be a way to dispose of the car in a way that minimizes your costs and has a positive impact.

Option 3: Keep Your Old Car

When you’re hit with a big repair bill, and your car is of a certain age, it’s always tempting to consider replacing it. But that’s not always the smart move and many car owners underestimate the total cost of a new car.

Let’s look at the two options head-to-head. We’ve assumed you’ve got a well-maintained used car that’s done somewhere around 70k to 120k miles:

Typical Cost of Motor Finance

• Keep it: $0 as you have paid off the loan in full and own the vehicle outright.
• Replace it: $400 to $600/month ($4,800 to $7,200/year)

Average Repair and Maintenance Cost

• Keep it (optimistic): Average repair and maintenance cost: $125/month ($1,500/year)
• Keep it (pessimistic): Average repair and maintenance cost plus one major component per year: $582/month ($6,989/year)
• Replace it: Average repair and maintenance cost: $75/month ($900/year)

Estimated Total Cost

• Keep it: $125-$582/month ($1,500-$6,989/year)
• Replace it: $475-$675/month ($5,700-$8,100/year)

Where These Figures Come From

ConsumerAffairs estimates an average annual repair and maintenance cost for cars at around $900/year. However, this figure can creep higher for older model years, higher mileage vehicles, and certain makes. Based on AAA’s 2025 Your Driving Costs study, the average maintenance cost is 11.04 cents per mile, putting the annual average cost for a car covering 15,000 miles per year at around $1,656.

But, if we’re pessimistic, let’s assume there’s a major unscheduled repair each year. Some of the most expensive repairs across different makes and models are:

• Engine replacement: $4,000-$10,000 (midpoint: $7,000)
• Transmission replacement: $2,900-$7,100 (midpoint: $5,000)
• Head gasket replacement: $2,886-$6,047 (midpoint: $4,467)
• Average of the three midpoints: $5,489

So, if you were unlucky and had one major component require replacement once a year, on top of the expected average repair and maintenance bill, you’d be looking at $6,989 over the year, or $582/month.

How a Used Car Warranty Changes the Keep-It Equation

Depending on repair frequency, replacement costs, financing terms, and vehicle condition, keeping an older vehicle may be more cost-effective in some situations. Ownership costs may be lower if the vehicle avoids major repairs for an extended period.

A used car warranty or vehicle service contract (VSC) may be one factor worth considering when you’re making the decision of whether to keep or replace your prized motor. A VSC is simply a coverage plan to help cover certain major repair costs. It works to keep your vehicle protected once your manufacturer’s warranty expires.

Imagine your BMW vehicle needs a head gasket replacement, and the repair bill is on the higher end of $4,500.

Example Without a VSC

You pay: $4,500 repair bill for the head gasket replacement. (And that’s just for one major repair!)

Example With a VSC

At $150/month, you’d pay $4,500 in premiums after 30 months. Factor in a $100 deductible, and the cost of that single repair could exceed the premiums paid during that period.

Of course, this is just an example for one repair and estimated costs. You can compare all our auto protection plans in detail for your exact car and circumstances here.

Customizable Coverage Options for Used Car Owners

Even if you have an older vehicle, with Endurance, you know you’ll have access to a range of coverage options and customer support resources. In fact, we were recently included in USA Today’s 2026 “Most Trusted Brands” list.

Our plans are designed to offer a range of coverage levels for your vehicle and budget, all with top-notch customer service. Our auto protection plans are flexible too, so you can speak to our friendly team, who will help tailor a package to your needs.

To learn more about available coverage options and to take advantage of our 30-day money-back guarantee, speak to an Endurance representative at (800) 253-8203. Alternatively, shop our online store to see your plan recommendations and compare prices now.

If you’d like to do some more research first, have a look at our extended warranty blog for comparisons of warranty plans and providers, plus much more.