Why you need to save $50 a month for car repairs

Could you pay for an unexpected car repair without running up your credit card bill? If you couldn't, you would have plenty of fellow travelers. A new survey from AAA found that one-third of American drivers would need to go into debt to pay for that repair.

That translates to 64 million drivers who can't readily pay to get their car fixed, which typically costs about $500 to $600. You don't want to be one of those vulnerable to having your monthly budget upset.

How should you guard against this? AAA counsels putting $50 a month aside in savings for a car care fund. "To avoid a surprise down the road, drivers should budget for monthly payments, insurance premiums, fuel costs and the inevitable expenses of routine maintenance and repair," said John Nielsen, AAA managing director of automotive maintenance and repair.

Of course, beyond the typical $500 to $600 bill, repairs can run to much more with major jobs involving the engine or transmission.

To avoid such a crisis, AAA makes the following suggestions:

  • When buying a new or used car, look at not only the price and the monthly payment, but also how much that car is likely to cost to own over coming years. Rankings such as Kelley Blue Book's five-year cost-to-own rankings can give you some reasonable estimates.
  • Stick carefully to the manufacturer's recommended maintenance schedule. Today's cars are better made and can last longer than in the past. But to get the most out of them, keep up the maintenance.
  • Find a repair shop you trust before you need one urgently. If you aren't using a dealership, a good starting point is the AAA list of 7,000 shops that meet the organization's standards for repair work and customer satisfaction. 
  • When you do have to go in for a repair, get a written estimate. Try negotiating the estimate and ask if the shop gives any applicable discounts, such as for membership in AAA or AARP.

No matter how new or well-made your car, some repairs are inevitable. So avoid that anxious feeling when hearing the repair cost by knowing you have money set aside to cover it.

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    Jerry Edgerton, author of Car Shopping Made Easy, has been covering the car beat since Detroit companies dominated the U.S. market. The former car columnist for Money magazine and Washington correspondent for Business Week, Edgerton specializes in finding the best deals on wheels and offering advice on making your car last.