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Do you only see more debt when you’re dealing with car repairs? Here’s how you can manage them without getting into debt. And what to do if you really do need to go into debt.
When you have major car repairs, the cost can seem daunting. For a lot of people, it means getting into debt. You don’t need to do this as for many repairs, you can actually plan ahead.
Maintenance on your car is necessary. This is more than your bi-annual oil change. You can checkout Nova Warranty’s client reviews for assurance. You need to think about other parts that are likely to start failing. This way, you can plan for the most likely needs as your car gets older.
Know when most car repairs are needed
Take a look at the specs of your car and talk to a mechanic about the lifetime of certain items. For example, I know my transmission in my Nissan Rogue is likely to last until 160k. It’s getting close to that, so I’m getting ready for a replacement. It’s just the type of transmission it is, and every mechanic I talk to has said something similar about the length of time I have.
You can look up the length of time most of your car parts will have. This gives you an idea as to what type of maintenance you need and whether something is going to show up at a service. If there are parts that you’re preparing for, you can talk to your mechanic about checking in on them at the service to see how close they are to needing a repair, especially when it comes to things like your brake pads.
Save up for regular maintenance and likely repairs
There are times that something out of the ordinary happens. This could be due to something malicious by an individual against you, or it could be due to an accident or something as simple as running over a nail. However, there are a lot of car needs that you can save up for and be prepared for.
You could do this in a couple of ways. I have two distinct savings accounts* for car needs. The first is my sinking funds account. This one covers the regular car maintenance and any other expected payments that I may have for the house. It helps to cover those payments in an emergency without dipping into my emergency fund.
Then I have an account that is purely for my big payments for my car, such as my transmission. I save a little each month in this. While it may not cover the full amount by the time my transmission does need replacing, there’s something there to help avoid using too much of my sinking funds or even dipping into my emergency fund. I definitely don’t want to go into debt!
MORE: 5 future expenses you need to save up for
Always have a plan to pay off your debt
Sometimes, you may need to go into debt for your car repairs. Maybe it is something so unexpected that you need to cover. A credit card or a line of credit could help in this instance. When you are going to do this, you need to make sure you have a plan to pay off that debt*.
Don’t go in and think “I’ll get to that later.” You want to work out the monthly payments to clear off your debt.
If I ever have to use my credit card for anything other than cash flow (which is how I generally use my credit card), then I will set up a plan to pay it off within six to 12 months. I prefer three to six, but that isn’t always possible. I’ll calculate the interest that is going to be added and make sure I make the split monthly payments plus extra for the interest. This then allows me to clear off the whole amount within my determined time frame.
MORE: 5 ideas to make a little extra money now the kids are back in school
How do you pay for your car repairs? Share your thoughts in the comments below.
