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A Cautionary Tale About Catastrophic Vehicle Expenses

(Psst: The FTC wants me to remind you that this website contains affiliate links. That means if you make a purchase from a link you click on, I might receive a small commission. This does not increase the price you’ll pay for that item nor does it decrease the awesomeness of the item. ~ Daisy)

By the author of the FREE online course Growing Self-Sufficiency: The Whole Picture

 

I recently heard a story from a friend about her daughter. She was facing a CA$2,200 repair on her old but not ancient vehicle and decided to get rid of it under pressure. She is in a two-income household, relatively secure. Both she and her husband have decent jobs. (A similar thing happened to Daisy.) When I heard what ended up happening, I thought to myself, “There’s an article here that I hope could be helpful to folks.”

For those of us driving more mature vehicles, this story made me think about the importance of having a plan regarding car repairs. As well, it underlined the importance of looking out for your own best interests. 

This is a cautionary tale that I hope will inspire some thought for each of us about our situation and what we would do if something similar happened to us. To avoid expensive litigation (I am a Frugalite after all!), I will not be sharing the make and model of this vehicle. No, not even if you contact me and ask nicely!

What happened to Sherri

I will call her Sherri. When Sherri found out about the cost of the repair for her seven-year-old vehicle, it sounded to me like panic set in. She drives a fairly long commute each day to a city, around 45 minutes or so. 

According to my friend, Sherri did not want to pay for the repair. However, in order to solve that problem, she ended up buying a new (yes, actually brand new!) car that she didn’t want in a color that she didn’t like. The car is too small to tow her treasured trailer on vacation, too.

How did this happen? And could it happen to you? Dear Frugalite, I certainly hope not!

Weighing the factors

It can feel very urgent when the decision of whether to bail on a car needs to be made. Here are some of the factors that need to be weighed:

  • how big is the repair bill, especially in relation to car payments?
  • how quickly do you need something?
  • what financial resources can be accessed to support your decision?
  • is it the car that you want?
  • what are your alternatives for transportation in the meantime?
  • do you have any leverage with the dealership you are dealing with? (If you do deal with dealerships; I do not, but Sherri did)
  • how motivated are you to NOT have a car payment?

In my opinion, Sherri had a lot going for her, even though her car needed an expensive repair. Her husband had a car. They work in the same city. She could have borrowed a car from her mother for a time. She had bought the first vehicle new from that very dealership.  To me, that meant she had some leverage there. 

What ended up happening to Sherri and her vehicle

The initial repair estimate was CA$2,200. When I contacted my friend again to check in on the situation, I got a big shock: the repair estimate had more than doubled to over $5,000! How could this happen to a relatively new car? The type of engine failure in Sherri’s car was so common on this make and model that there are no used engines on the market! 

In addition, the dealership flat out refused to even take a trade-in on Sherri’s now-dead vehicle. (Which she had bought from them brand new only six or seven years ago!) They forced her to remove the car from their lot at her own expense.

In the end, Sherri still bought the new vehicle from them in a color she did not like and a size that would not allow her to tow her holiday trailer on her camping vacations.  

What lessons can a Frugalite learn here about vehicles?

I call this a cautionary tale for a reason.

In my humble opinion, I am not sure that that dealership could have offered me a deal that would have kept my business there. Even if they had offered me the new car at half the sticker price, I would have been hesitant, given the mechanical failure of their product and (my opinion again) their lack of goodwill.

My feeling would be to run, not walk out of that dealership.  At the very least, I would have demanded a loaner car from them so that I could secretly shop for a new vehicle….elsewhere!

Here is a list of my thoughts after hearing Sherri’s story:

  • Have a vehicle failure/major repair plan in place – Talk to friends, family, or co-workers, “Hey, I was wondering…if something happened with my car, could we rideshare for a couple of weeks?” Weigh your factors from the list above before any problems arise. Decide on your maximum allowable repair cost. Do your best to arrange backup transportation if a repair should arise. Know the market for good used vehicles (if that’s your target, like me) and where to buy them.
  • Not having a car payment is worth a lot of money – I would be willing to spend a fair bit of money to repair my car, at least $1,500. Why? Because I’d rather spend that money (if my vehicle was otherwise reliable) and pay it off in a year or two, rather than have a car payment for the next six years. Buying the new version of my car would cost more than $20,000 for the base model, and that’s at seven percent interest over six years! For the financing offered by a dealership, the payment would be a whopping $300 per month. 

Will you ever see me buy a new car? Nope. My most recent car, Lucky, cost me around $3,000. These days, I could pay that off in around 1 to 2 years, leaving me payment-free for the remaining 4 to 5 years of a car loan term. 

  • Clarify your relationship with your garage/dealership – Do you get a loaner for a major repair? Why or why not? If you’re not getting the deal you want, be ready to take your business elsewhere.
  • Having an emergency fund gives you options. It’s worth putting away a bit every week to get one going. Here are some great tips from Daisy around that.
  • Buy only vehicles with solid reputations for reliability, not trendy new ones. I bought my current vehicle, Lucky, after multiple recommendations from mechanics and someone who had owned one for over a decade.
  • Be prepared to get multiple quotes on major purchases and take your time. PERIOD. Make it clear everywhere you go that you are shopping around. No one else is going to look after your interests in a transaction. Make them earn your money. That’s what they’re there for.
  • Make a dealership earn your loyalty. Don’t give it away. Be ready to walk if you don’t feel you’re getting what you deserve, and then walk if required. If you are shy or don’t have the negotiating skills for a situation like this, bring along your bulldog friend and treat him or her to lunch after the meeting.

Could it Happen to You?

It can be much harder to stay frugal under pressure. Could you see yourself considering any of the factors or tips offered here? Do you have your own catastrophic car repair story you can share with us? Please tell us in the comments below.

About Colette

Colette is passionate about sharing her knowledge of thrifty living and self-sufficiency. She has developed her skills in self-reliance living in the suburbs, the city, and more recently, on her own Half-Acre Homestead. Colette lived five years completely off-grid and without running water in an eight by 24 foot tiny home while designing and building her own 18 by 24-foot eco-cabin. Her website, Half Acre Homestead is attracting followers from around the world who want to become more self-sufficient.  Colette invites you to stop by the Homestead and check out all of the great resources including the practical How To Guides, A Tiny Home Resource Center and her organic gardening stories on her blog. She shares her wholistic model (body/mind/spirit) for achieving self-sufficiency in her Free Course, “Growing Self-Sufficiency: The Whole Picture.” Stop by the Homestead today to register free of charge!

Colette

Colette

Colette is passionate about sharing her knowledge of thrifty living and self-sufficiency. She has developed her skills in self-reliance living in the suburbs, the city, and more recently, on her own Half-Acre Homestead. Colette lived five years completely off-grid and without running water in an eight by 24 foot tiny home while designing and building her own 18 by 24-foot eco-cabin. Her website, Half Acre Homestead is attracting followers from around the world who want to become more self-sufficient.  Colette invites you to stop by the Homestead and check out all of the great resources including the practical How To Guides, A Tiny Home Resource Center and her organic gardening stories on her blog. She shares her wholistic model (body/mind/spirit) for achieving self-sufficiency in her Free Course, "Growing Self-Sufficiency: The Whole Picture." Stop by the Homestead today to register free of charge!

12 thoughts on “A Cautionary Tale About Catastrophic Vehicle Expenses”

  1. Necessity makes a poor bargain. I’d have left the lemon at the dealership and contacted the media/posted on social media. Trust me, companies watch social media like a hawk for any bad PR.
    Your friend had a knee-jerk reaction for a situation that was not fight or flight. An emergency fund can be used for (reasonable!) repairs but I also have money earmarked for vehicle/equipment repairs/maintenance. As well as keeping track of how old appliances/HVAC/water heater/well pump & pressure tank are. I do admit to replacing appliances, usually before a repair is needed. The cost estimate to fix our previous stove amounted to half the cost of a new stove.
    We also are cognizant of home repairs. It won’t be long until we’re both retired. Retirement budget will have a home repair “line item” which will also cover tree trimming/removal for those we cannot safely do ourselves. Since money is still coming in, it might more sense for us to replace our shingles a bit sooner than needed but we don’t need to make that decision today.

    1. Hi Selena, I appreciate your taking the time to share your wisdom. The social media angle is sheer genius. I have seen many cases where business did jump to address the concerns with smaller items, so it makes sense that there would be motivation with a car, too. As I am also on the road to retirement (aren’t we all?) I appreciate your considering how to manage and plan for expenses post retirement. Thanks so much!!!

  2. In 2008, my bought-used 1984 Toyota truck suddenly developed a problem w/I think it was the engine or something ‘up front’), as I was driving through town after shopping. Luckily a repair shop was nearby. Long story short, the owner gave me a $500 estimate. Well, that was about what I had extra, but I got the feeling he was over-pricing, so I thanked him, and managed to drive it home (via lots of prayer), where it was parked and stays to this day (it’s now called ‘yard art’). Am lucky in that I can take public transportation which is way less than monthly vehicle expenses. Have a good day.

    1. Hi Robin, Thanks for your story about your ‘yard art,’ which is way cheaper than paying someone to fix it! Good for you that you are able to save by using public transportation. That’s a Frugalite Happy Ending! Much appreciated!

    1. Hi Mustang, I totally agree. Even after trying to dig for further deets from her mother, my friend, I couldn’t make heads nor tails of it, and that is why I shared the story with what I was able to find out. Wishing you a great year!

  3. I have never ever bought a new car or truck to avoid suffering the off-the-lot value bite. I believe that the search for a good used vehicle should begin with a search for a (or some) mechanics you can afford and trust. That includes one that will go over your next contemplated vehicle purchase for condition, reliability, repair parts availability,etc — which the owner/seller may well not know in the detail you need. No inspection allowed? No deal, period!

    There are other reasons for sticking to used vehicles. Decades ago I used to buy wrecked Italian sports cars and assemble fully roadable versions from the pieces of several … so I have some idea of what it takes to maintain a vehicle and how to chase down repair parts at reasonable prices. That was much easier back in the era before vehicles began to be semi-conductor electronicified and “smart” cars began getting connected to “smart” phones etc with all the privacy and reliability violations that brought. I remember reading about people in Cuba being able to keep 1950s vintage American cars running for decades after Castro took over … long after the border was closed.

    With that in mind the current US administration’s (on the side of the tyrant globalists) war on fossil fuels in favor of high-dollar EVs with remote shutoff vulnerabilities, fire-hazard high priced batteries, and self-driving wreck potentials … makes me want to avoid electronically vulnerable vehicles as long as possible. So there are some non-obvious advantages to being able to maintain older vehicles as long as possible with whatever blend of DIY maintenance and contract-it-out maintenance that makes sense for you.

    –Lewis

    1. Hi Lewis, My goodness! There’s a lot of wisdom and experience behind your comment here today. I spoke with my mechanic about the battery operated cars, and he simply said, “Don’t be the guineau pig on those….or it’ll cost ya!” He also mentioned the weight of the batteries as a concern. I’m hoping my modest Toyota Corolla, Lucky, will do me until it’s banned. I wish you the best with navigating the new terrain of the used vehicles. A very happy, healthy, and frugal New Year to you, too!

  4. In a lifetime I’ve owned 2 new cars. But many older used cars that were cheap and gave me years of service. I usually bought the Chilton repair manuals for them so I could troubleshoot and do the repairs if I know the problem. If it was too hard I could tell what seemed to be the problem and negotiate the repair.
    My current ride is a 21 year old pickup with over 200,000 miles on it. I have another I’m fixing up. 24 years old but more ecconomical. I’ve fixed up several at a time to always keep something so I could keep my jobs. For several years I drove a Toyota Tercel and. Subaru station wagon. Both were 16 years old at that time. I always had to have a car running for my job. I’m retired now so usually just keep one thing running. But I’ll get the more ecconomical one going and use that for most of my running around. Save the truck for hauling things.
    I’m blessed with a fiancé and a son nearby who are both good mechanics as long as it isn’t a computer problem. I buy parts and they will do the repairs. I don’t work on vehicles anymore.

    1. Dear Clergylady, Thank you so much for your comment and insights. I admire your mechanical abilities. That is a great tip to have the repair manual on hand. While I have my little Corolla for running around economically, one issue I do run into is that I don’t have a truck for hauling. It gets difficult sometimes. Good for you for keeping your pick up around! I wish you a very happy and healthy New Year with all of the smooth running vehicles that you need!

  5. I keep reminding my sister that health-care is not what it was. The same goes for auto repairs at the dealership. Gone are the days in which “loaners” are provided. Our dealership says they have them, but they’re booked 2 months in advance. Who knows they’re going to have car trouble in 2 months?? What that tells me is that they’re saving the loaners for people who schedule oil changes, etc., which makes no business sense to me.

    We live in a rural area and there are limited options for car repair. My husband used to do most of ours, but he’s unable to do that, now. A local mechanic, who was excellent and reliable, refused to work on our brand, and besides, he’s now retired. I really wish our 1971 VW beetle was restored and running.

    1. Hi Carla, Thanks so much for sharing details about the situation in your area related to vehicles and their repair. It sounds like a mirror for the challenging times that folks are facing. I have always said that a good mechanic is worth his (or her) weight in gold. I hope that you are able to find a new one. It would be wonderful to have a vintage VW Beetle to drive around. I would imagine the engine would be chip free and nice to work on! Thanks again and wishing you the best for 2024, Carla!!!

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