Decisions about a car are rarely about perfection—they’re about fit. You have real costs, real routines, and real trade‑offs. I’ll guide you through a clear, weighted decision matrix so you can compare “keep,” “refinance + keep,” and “sell,” using criteria that reflect both total cost of ownership and daily convenience.
Before numbers, let’s ground this in your values.
Values warm‑up (3 prompts)
- What do you most want from mobility this year—stability, flexibility, or savings? Write one sentence you can revisit when trade‑offs feel messy.
- What are you willing to give up to protect that priority (e.g., cargo space, fastest acceleration, weekend availability, a bit of comfort)?
- What risks feel acceptable vs. not (e.g., unexpected repairs, higher insurance, taking transit in bad weather)?
Matrix setup: what to include and why We’ll combine cost factors (what you pay over time) and convenience factors (how the car fits your life). Structure your sheet using common TCO components so the options are comparable across time horizons (Edmunds TCO framework: depreciation, financing, taxes/fees, insurance, fuel, maintenance/repairs) [Edmunds]. Use weights (1–5) to reflect importance, then score each option (1–5). Multiply weight × score to get a weighted score; sum across criteria.
- Depreciation and resale value. Depreciation is typically the largest ownership cost; AAA’s 2025 figures show the biggest component is depreciation, with total average new‑vehicle ownership cost at $11,577/year (depreciation ≈ $4,334; finance ≈ $1,131) [AAA 2025]. Use this to give depreciation a higher weight if you’d sell soon or replace with a new car. Check your model’s class for resale expectations—many 2025 models retain around 45% after five years, with top models above 53% [KBB Best Resale]. Hybrids often retain value better than average (≈40.7% depreciation over 5 years), while many EVs depreciate faster (≈58.8%) [iSeeCars].
- Financing and payments. If your current payment is the pain point, add “refinance + keep” as a separate option; refinancing grew nearly 70% YoY in 2025, lowering payments by about $71 on average, with modest APR declines versus 2024 [Experian]. Re‑score affordability after you estimate your credit‑tier APR.
- Insurance. Insurance costs have been a major driver of transportation inflation; BLS reports motor vehicle insurance rose 11.8% YoY in January 2025 and 11.3% over 2024 [BLS CPI]. The BTS transportation CPI also shows insurance as the top contributor, while gasoline prices fell YoY—so model scenarios where fuel improves but insurance remains elevated [BTS].
- Fuel/energy. The EIA expects regular gasoline to average around $3.10/gal in 2025, easing versus 2024—avoid over‑penalizing fuel if your commute is stable [EIA]. As a quick cross‑check on your cost‑per‑mile math, compare to the IRS 2025 business mileage rate (70¢/mile), which reflects fixed and variable costs [IRS].
- Maintenance/repairs and reliability. Maintenance/repair inflation has been running mid‑single digits in 2024–2025 [BLS CPI]. To weigh “fix vs replace,” Consumer Reports suggests dividing a repair’s cost by the months you’ll keep the car; minor fixes can beat a new‑car payment, but chronic issues justify replacing [CR Fix or Replace]. If you’d replace with an EV or PHEV, consider reliability risk and potential extended warranty costs; recent data show EV reliability improving but still trailing gas models, and PHEVs tend to have more problems than traditional hybrids [CR Reliability via AP].
- Replacement cost today. If selling would force a new purchase, include today’s replacement cost and incentives. The new‑car average transaction price set a record (~$50,080 in Sep 2025), with incentives around 7.4% of ATP—high replacement costs can tilt toward “keep” unless reliability is poor [KBB ATP].
- Timing and resale market. In a volatile used‑car market, resale timing matters; the Manheim index rose 6.3% YoY in mid‑2025 amid tariff‑related swings [Manheim]. If the index is up, consider raising the weight on “resale value” and getting instant offers to lock a price.
- Convenience: time and fit. Include time saved vs. alternatives, downtime from repairs, cargo/utility, safety/recalls, and flexibility (e.g., shared household needs). This reflects Pugh/ASQ matrix best practices—weight criteria, score options, and rank [ASQ].
A note on using your past data: A simple, privacy‑respecting budget log (e.g., monthly categories for fuel, insurance, repairs, parking) lets you pull patterns like “transport spikes” or “repair clusters.” Those patterns help set realistic weights and scores for your own situation without overfitting to headline averages.
A blank weighted cost‑convenience matrix Use weights 1–5 (5 = very important). Score each option 1–5 (5 = best fit).
| Criteria (examples) | Weight (1–5) | Keep Car Score | Keep Weighted | Refinance + Keep Score | Refi Weighted | Sell (Replace) Score | Sell Weighted |
|---|---|---|---|---|---|---|---|
| Depreciation / Future Resale | |||||||
| Financing Affordability (APR/payment) | |||||||
| Insurance Cost Outlook | |||||||
| Fuel/Energy Cost per Mile | |||||||
| Maintenance/Repairs (next 12–24 months) | |||||||
| Taxes/Fees/Parking | |||||||
| Reliability/Downtime Risk | |||||||
| Utility: Cargo/Seating/Safety | |||||||
| Flexibility (household needs/backup) | |||||||
| Time Saved vs. Alternatives | |||||||
| TOTAL |
How to set weights (practical guidance)
- Start from TCO emphasis. Given AAA’s finding that depreciation is the biggest cost component, give “Depreciation/Future Resale” a higher weight if you might sell soon or buy new; “Financing Affordability” also deserves attention, especially if payment stress is the driver [AAA 2025].
- Reflect current inflation. If your goal is cutting ongoing costs and you’ve seen insurance hikes, increase the weight on “Insurance Cost Outlook” and “Maintenance/Repairs” to capture 2024–2025 inflation dynamics [BLS CPI; BTS].
- Calibrate fuel realistically. If your miles are steady and fuel is easing per EIA, moderate the fuel weight so it doesn’t overshadow bigger drivers like depreciation and insurance [EIA].
- Capture reliability realities. If you’d switch drivetrains (ICE → EV/PHEV/HEV), reflect depreciation and reliability differences in “Depreciation/Future Resale” and “Reliability/Downtime Risk” [iSeeCars; CR Reliability via AP].
- If payments are the issue, add “Refinance + Keep” and re‑weight “Financing Affordability” to reflect your credit‑tier APR options [Experian].
How to score options (1–5)
- Keep Car: Base scores on your last 6–12 months of actual spending and any known upcoming maintenance (use the “monthly equivalent” method for large repairs) [CR Fix or Replace]. For fuel, sanity‑check your per‑mile estimate by comparing against the IRS 70¢/mile benchmark [IRS].
- Refinance + Keep: Score higher on “Financing Affordability” if a refinance meaningfully lowers payment or APR; keep other scores the same as “keep,” unless refinance changes insurance or usage [Experian].
- Sell (Replace): If selling forces a new car at today’s ATP levels, score “Financing Affordability” and “Depreciation/Future Resale” conservatively; if you can avoid buying new or can leverage strong resale timing (index up), raise “Sell” on resale but still model replacement realistically [KBB ATP; Manheim; KBB Best Resale].
Sensitivity test (stress‑test your decision) Even good matrices hinge on a few assumptions. Perform a simple sensitivity analysis to see if your decision is robust.
- Swap two weights that reflect current volatility:
- Scenario A (Insurance stays high): Increase “Insurance Cost Outlook” weight by +1 and decrease “Fuel/Energy” by −1, given insurance’s outsized CPI contribution and easing fuel [BTS; EIA].
- Scenario B (Resale swings): Increase “Depreciation/Future Resale” by +1 if used‑vehicle values are rising and instant offers look strong; decrease “Maintenance/Repairs” by −1 if you’ve recently addressed major repairs [Manheim].
- Rerun your totals. Did your top option change?
- If the choice flips when insurance weight moves, your decision is sensitive to premium quotes—collect at least three quotes and re‑score [BLS CPI].
- If the choice flips with resale assumptions, get actual bids and check your model’s resale class to anchor depreciation [Manheim; KBB Best Resale].
- Sanity‑check cost per mile. Compare your “keep” and “sell” TCO-per‑mile to the IRS 70¢ benchmark as a reasonableness check (not a decision by itself) [IRS].
Interpreting the results
- If “Keep” wins by a small margin but is sensitive to insurance, action the insurance quotes first and set a calendar reminder to revisit in 60 days.
- If “Refinance + Keep” pulls ahead, the math says payment relief is available without losing a reliable vehicle; validate with your actual APR offer before committing [Experian].
- If “Sell” wins only when assuming a cheap replacement, scrutinize today’s ATPs and incentives; replacement costs are historically high, so the bar for “sell” is higher unless reliability or safety is a concern [KBB ATP].
- If your car is reliable and already financed at a favorable rate, your “keep” case may be stronger in 2025 because total ownership costs have eased from 2024 while insurance and repairs remain elevated—costs pulling in opposite directions [AAA 2025; AAA 2024; BLS CPI; BTS].
Make trade‑offs explicit Write down what you’re okay giving up for your top choice:
- If Keep/Refi: “I accept the risk of one unplanned repair in exchange for avoiding today’s replacement costs and keeping monthly payments manageable.”
- If Sell: “I accept higher near‑term depreciation and time shopping for a replacement in exchange for better reliability and lower downtime.”
Quick build instructions (recap)
- Create the matrix with the criteria above (weights 1–5; scores 1–5).
- Use your last 6–12 months of transport spending to inform scores; if you track categories like fuel, insurance, and repairs, pull those patterns to set realistic baselines.
- Anchor costs with trusted references: AAA for component emphasis, BLS/BTS for inflation dynamics, EIA for fuel direction, IRS for per‑mile checks, Edmunds for TCO structure, and Consumer Reports for repair‑vs‑replace logic.
Decision commitment and de‑risking plan
- Commitment statement: “I choose [Keep / Refinance + Keep / Sell] because it best fits my priority of [stability / flexibility / savings] given today’s costs and my routine.”
- 30‑day de‑risking plan:
- Quotes and offers: Get three insurance quotes and, if relevant, instant resale offers to firm up assumptions [BLS CPI; Manheim].
- Financing: If payment relief matters, apply for a refinance quote and confirm your APR before finalizing scores [Experian].
- Maintenance triage: Price the next likely repair; convert to a monthly equivalent and compare to your payment options [CR Fix or Replace].
- Replacement diligence (if selling): Validate current ATPs and incentives; check your model’s resale class and likely depreciation curve [KBB ATP; KBB Best Resale; iSeeCars].
- Reality check: Compare your TCO‑per‑mile to the IRS 70¢/mile as a sanity check [IRS].
- Calendar a 60‑day review to revisit the matrix after quotes/offers arrive. A decision made with current best evidence is preferable to a perfect decision deferred.
What’s not covered
- Local taxes, parking regulations, and specific model defects vary by region and vehicle; use your municipality and model‑specific resources for those details.
- Charging or fueling infrastructure constraints and incentives differ by area; factor your local conditions into “Time Saved” and “Flexibility.”
You now have a practical, values‑first matrix, grounded in current cost dynamics and reliability trends. Score honestly, stress‑test the few levers that can swing the outcome, and then commit to your best‑fit choice with a small de‑risking plan.
Sources:
Discover Monee - Budget & Expense Tracker
