Formulas
Keep = repair + known near-term costs + years × (maintenance + insurance + fuel) + other keep-side financing charges − ending value.
Replace = purchase + acquisition fees + interest through comparison period − current-car sale + years × (maintenance + insurance + fuel) − replacement ending value.
Repair advantage = replace − keep. A positive number favors repair under the inputs supplied.
Annual fuel = annual miles ÷ MPG × gas price. Loan payment = P × r × (1+r)^n ÷ ((1+r)^n − 1), or P/n at zero APR.
Scope, assumptions, and limitations
No inflation, investment return, discounting, or tax deduction is modeled. Running costs are held constant in each year.
The financing model assumes a fixed APR, monthly payments, and no extra payments. Interest is accumulated through the shorter of the loan term and the comparison period. Principal is not counted twice.
The current vehicle is assumed owned free of a principal balance for this comparison. If it has outstanding principal, use a fuller debt and cash-flow model. Do not subtract a loan payoff from the gross sale value in this tool; that would make the two sides inconsistent.
A period longer than expected usable life is flagged as incomplete. Safety, mechanical condition, downtime, and reliability remain separate decisions.
Confidence and precision
Calculations retain precision until display formatting. The input-quality indicator is based on your classification of the source groups, not whether a field happens to contain a value. It does not measure the probability that a future outcome will match the estimate.
Example inputs are for learning the tool. Replace them with your own values, and compare a less favorable scenario to understand sensitivity.
Primary sources
AAA: Your Driving Costs 2025 fact sheet ↗
September 16, 2025 · Checked September 5, 2026
Methodology version 1.0 · Reviewed September 5, 2026.