Jun 01 2009

Should you save for car repairs?


New Tires

Photo by Kalebdf

Of course it happens like this. Not more than a month after paying off our car, we have to spend money on it. It could be worse — we could still be making payments on it and shelling out a few hundred dollars for a new set of tires.

On Thursday evening, our turn signal sounded fast. I suspected that meant that it wasn’t working, and I was right. We had no rear turn signals and no rear brake lights. I was just asking to be rear-ended.

The car was due for an oil change, so I took Shirley (my car, of course) to the auto shop down the street. They replaced the bulbs, did the oil change and told me that I would need to have my tires replaced by the time my state inspection was due in November.

For those of you who don’t live in the lovely Commonwealth of Pennsylvania, you should know that your car must be inspected each year to ensure it meets safety and emmissions requirements. It costs something like $70 per year.

My tires have worn past the set safety limit. I will not receive my inspection sticker without replacing the tires.

I did the penny-in-the-tread trick to see if the treads were sufficiently worn or if ol’ Tim at the auto store was trying to fool me. Abe’s head was sticking way out. Dang.

I do believe the tires are bad and I’d like to replace them sometime soon — certainly before our next roadtrip.

These tires have about 27,000 miles on them. I’m vigilant about making sure they’re aired properly, and I make sure they’re rotated when they need to be. Seems to me that those tires should have gotten a lot more mileage out of them. Sorry, Goodyear. Not buying your tires next time.

I’m going to shop around for the best deal (naturally). I want a good price on a quality tire. I’d like to get at least 50,000 miles out of the next set. A longer-lasting tire will save me money in the long run and will be less rubber in landfills.

Now, the big question: Should we save money specifically for car repairs?

Our car is three years old. Low mileage. We take good care of it. Still, we can probably expect to spend a few hundred or more every year or so.

Rather than set aside a specific savings account for car repairs, we’re just going to tap the emergency fund if we can’t absorb it in our regular budget. In our mind, car repairs are one of the purposes of our emergency fund.

We’ll use our savings and rebuild it as we can.

What about you? Do you have a separate fund for car repairs? Any tips for me as I go tire shopping?

Posted under Uncategorized | 21 Comments »

21 Responses to “Should you save for car repairs?”

  1. Great post!

    We’ve been hit with a LOT of car repairs in the last six months, including TWO new sets of tires and an engine rebuild. We did have an emergency fund when all of these hit, so nothing went of the credit card, but we didn’t like how our emergency fund kept getting depleted, over and over, while we were trying to build it up. We know this is just coincidence, that all these came all at once, but it motivated us to more aggressively contribute to a car repair/replacement fund. Last week, when the brakes went out on our extra vehicle, we had the money in the car repair fund to fix them- without touching our emergency fund.

    I guess some car repairs ARE emergencies, but, because they are somewhat foreseeable (you WILL need new tires at some point), it made sense to us to have a separate fund.

  2. Don’t tires have a warranty with them? We bought 75K (I think) tires last time. I was under the impression that if they died before that they would take care of them. Maybe I am really wrong….

    As of right now we don’t have a specific car fund, we take from our emergency fun, but we do save up for things that need to be replaced yearly like tires and monthly oil changes etc. (We travel A lot) We save the emergency fun for actual repairs.

  3. I have a seperate category in my budget for car repairs, inspections, tires etc. How do I know how much to budget here? The biggest german automobile club offers a free service to its members: They let you figure out the costs of driving your car (incl. repair, insurance etc.) depending on the specific car make and your mileage. The online tool told me that I have to expect monthly repair costs of 93 € (incl. tires). So that’s the amount I budget for.

  4. We keep a separate savings account for car maintenance. The way I see it, most maintenance circumstances don’t really qualify as emergencies because we know they’re coming. Cars need to be serviced. They need oil changes, new tires, and as they get older they’re guaranteed to need additional and more expensive repairs.

    Saving especially for car repairs has been extremely beneficial to us. Because our car is pretty new, we only put aside $25 a month. That amount covers oil changes, state inspections (we have them, too, but they only cost $35), and last year we even used it to pay our auto tax. When we needed new tires a couple months ago, the fund came up short, but it made it so that we had to take $100 less out of our emergency fund.

    I dunno. If you can work it in, I think it might make your life a little easier to save separately for car repairs.

  5. A quick comment about shopping for tires..

    My dad and brothers started me using http://www.tirerack.com to find tires. I search the site, read about the ratings, and compare the tire brands that I could get at Sam’s Club or Firestone or another car place. This last time I bought tires I bought them from http://www.tirerack.com and they shipped them to me within about 2 days. Then I took them to a local mechanic and he charged me $15 a tire to install them. I was able to get MUCH better rated tires for the same price I would have paid at tire shop and they should last me a lot longer. Some of the benefits of looking at the ratings and reviews is that they rate them for water, and snow, and ice, and just street use, so I was able to buy the tires that would work best for where we live. I was also able to read a lot of other reviews about how long the tires lasted. The website was very helpful in helping me (a person who doesn’t know a lot about cars) be able to research and buy a good tire.

  6. Thanks for sharing how you do it, everyone!

    We don’t drive much, so we tend to just need an oil change every three months. We roll those smaller expenses into our monthly budget.

    As far as the tires go, these are the ones that were factory installed new. I guess I should call the dealership to see if there’s any sort of warranty for the tires, but I’m not sure. It would be worth checking into!

  7. I’m with a few of the other commenters – we have an Auto Maintenance line item in our budget. It’s probably low for any major major repairs, but covers any expected annual maintenance and typical parts that need be replaced.

    My husband does most of the work on our cars himself, so he estimated parts costs based on scheduled and typical repair/replacement timeframes.

  8. We drive used cars (1993 and 2001), so it makes a lot of sense for us to have a budget category for car repairs. It has served us well and is definitely worth it!

  9. i have a separate auto account with savings for repairs, maintenance, insurance, registration, and when i need it my next car.

  10. Hi Kacie,
    I’d say it depends on what kind of car you have and how much you drive it. If it is a Honda or Toyota with low mileage you might not need major repairs until 5 years +. I’d start saving anyway though.

    About the tires, did they check your alignment? Did the tires wear evenly? That is really fast for tires to wear. I hope that they have a warranty.

    I bought my last tires at Costco. Unfortunately, I live in one of the most expensive areas in America and there were no other deals. =-( Good luck!!!

  11. There’s a difference between a car emergency, like having to replace your alternator, and having to do scheduled maintenance, like change the oil or replace the tires.

    It only makes sense to put aside a small amount each month for the second kind of expense. That way, you will always be able to take care of the maintenance in a timely manner.

    As for car emergencies, our car crises have tended to run somewhere between $700 and $2,000 and occur every year or two. If you have enough in your emergency fund that you will still have money left afterwards (in case you get hit with a double whammy like car and illness) then it’s okay if you’re comfortable with using your emergency fund for this sort of thing. If it would wipe you out, that probably means you either need an extra (separate) fund for car repairs or to add more money to your regular emergency fund.

  12. I guess another reason I feel fine with tapping the e-fund is that right now, we’re in savings mode and we’re throwing a bunch of money into it anyway. Whether it’s marked for “car” or just “general emergency” wouldn’t really make much of a difference.

    Right now, we have 6+ months worth of expenses and it would more than cover a few huge car repairs.

    I do think that as the car gets older and we put more miles on it, it would be better to start saving for those bigger repairs. The car does have an extended warranty and that’s good for another two years, I believe (I shoulda mentioned that earlier!).

    So once that goes away, then having a car fund makes even more sense.

  13. Thanks for the site, Rebekah! I’ll check it out.

  14. I think it’s a really good idea to save for car repairs, or at least regular car check ups and maintenance costs. My car’s not really new, and it’s been through a lot! So I find it really useful that I don’t have to panic or worry about where I’m gonna get the money to pay for car repairs or upkeep.

  15. We have an “irregular expenses” fund, where we save for things like bi-annual car insurance payments, renters’ insurance, dues for various organizations, etc. We include car repair costs in here – we assume a few hundred dollars per year on each of our two cars. If we don’t spend that, then fine – it just builds up.

    As far as buying new tires, I’d suggest NTB. If you spend a bit more on the installation costs (I think $24/tire, or at least that’s what it is near us), they provide a warranty on the tire. If a 60k tire wears out at 20k, they’ll only charge you 33% of the cost of a new tire. Also, since NTB is a national company, they’ll honor this even if you’re on a road trip and your tire blows somewhere far from home.

  16. There are times when I definitely think it’s wise to have savings for car issues if you can. I’ve had to buy two new car tires in the last few months and that alone is pricey. However, rather than create a separate account for it, I’m just contributing to a general emergency fund. If I have a major car issue, the money can go toward that, but I’m also keeping the funds available for other types of crises.

  17. Little late chiming in here, but absolutely. Somewhere between my mom’s 2nd and 7th flat tire/tire blowout, I started saving money specifically for car maintenance and basic repairs.

    I have the luxury of not considering them emergencies, and basic maintenance most certainly isn’t, so I love that car issues are no longer dinging my regular expenses or emergency funds. It flows so much more nicely now!

  18. I kept thinking about this and posted about it. Thanks again for the good thoughts!

  19. yes, it s really a good idea to save for car repairs we have to do a check up every 3 months with an expert and a daily check by our selves it s something necessary, i have a car and i do a check up every month when i wanted to sell it they gave me a good price.

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Hey! I'm Kacie, wife and mother of 3. I write about my family's finance: how we save money, improve our spending, and plan for the future.

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