Are you prepared to handle major car repairs?
According to the AAA survey, one in four American drivers could not cover a car repair of $2,000 if faced with it today. The survey also found one in eight would be unable to pay for a repair bill of $1,000.
Half of America is holding onto an older vehicle to avoid the financial burden of a new one. One in four drivers have neglected automotive repairs and maintenance over the past 12 months due to tight budgets. AAA reminds you this can greatly increase the likelihood of needing costly, major repairs.
"Economic conditions have taken their toll on many Americans resulting in them neglecting their cars and leaving them at increased risk for very expensive repair bills," said Marshall L. Doney, AAA vice president, Automotive and Financial Services. "Many Americans rely on their cars for their livelihood and losing access to them could be financially devastating during an already troubling economic time.
"It's important for drivers to not only continue to maintain their vehicles, but also have a financial emergency plan in place should they be faced with a sudden unexpected auto repair bill," he said.
The survey revealed 38 percent of American drivers would pay a $2,000 repair bill with savings, while another 20 percent would use credit. Eleven percent would have to borrow money from their friends, family, retirement or home equity or simply park the car due to a $2,000 repair bill.
Roughly half could pay a $1,000 repair bill with 46 percent drawing upon savings and 22 percent using a credit card. Fourteen percent would again have to borrow from their friends, family, retirement and/or home equity – or get used to public transit.
If the cost of major auto repairs has slipped your worried mind, a transmission repair can run from $2,000 to $4,000, while an engine problem can easily exceed $5,000. Major brake repairs may range from $350 to $1,000, and a new set of tires can cost from $300 to more than $1,000.
It seems you can find some old cliché to back up any common concept, but in this case the old stitch in time saying would seem to apply. In modern terms, you don’t have to pay now, but you WILL pay – sooner or later.