How to decide whether to fix your Subaru, or when its time to buy a new car.
Its inevitable; drive enough miles in your Subaru, and eventually it will need some major repairs. We often have the conversation with our customers: do I fix this Subaru, or buy a new one? We’ve found its best to start by asking two questions: do you still enjoy the car and is it meeting all of your needs? If the answer is yes to both questions then its time to look at the financial side.
Subaru’s, as well as other cars, are getting more and more expensive. Re-investing into your current Subaru can actually make sense and save you thousands in the long run. In my cost of ownership analysis I compared a brand new, entry-level 2018 Subaru Impreza to a 2005 Subaru Outback. I also assumed no money down an a 0% interest, 4-year loan. After researching some numbers it’s pretty clear which scenario is more financially beneficial. For some more customized research, Edmonds has an excellent cost of ownership calculator for new cars.
|Cost of Ownership over 4 Years|
|Own Outright||New Purchase|
|2005 Subaru Outback||2018 Subaru Impreza|
|Purchase price incl tax/lic||$0 (no monthly payment)||$22,360 ($466 monthly pmt. 0 down 0% interest)|
|4yrs Lic/Reg/RTA est.||$92||$0|
|Insurance(no comp/coll on 05)||$575||$750|
|Estimated worst case||$2,000||$500|
|on 2005 model||$2,000||$800|
|Depreciation over 4 yrs||$3,000||$11,470|
|based on Edmonds.com|
|Total Cost of Ownership||$21,645.00||$46,500|
I think that my guess-timate of expenses for the 2005 Outback is a bit high. It would be out of the norm for you to spend $8,000 in repairs and maintenance over 4 years, even if it needed head gaskets during that time.
But the New Car Smell…
I realize that not all decisions are based on finances. Some of us just love the new car smell. Newer models also have new safety and technology that can be beneficial. Whether you decide to fix your Subaru, or buy a new one, I just want you to be happy with your decision. We’re always here to help answer questions. We’ve also written a post on how to approach buying a used Subaru, if that is a route you want to explore.
Last Updated: February 25, 2020