As tire prices continue to climb seemingly relentlessly, the AAA says that 25% of Americans don’t have the money to pay for an expensive car repair of any kind.
According to the new survey, AAA found that cash-strapped Americans could not handle a $2,000 vehicle repair bill "if faced with one today." The survey also found one in eight would be unable to pay for a repair bill of $1,000.
More than 50% said they are holding onto their older vehicle because they do not want the financial burden of a new one, and because vehicle financing availability and terms have become tight. And, one quarter of drivers admitted to neglecting repairs and maintenance on their vehicles in the past 12 months due to the economic climate.
"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 Doney, AAA vice president. "Many Americans rely on their cars for their livelihood and losing access to them could be financially devastating during an already troubling economic time."
According to the survey, 38% of American drivers could pay for a $2,000 repair bill with funds in a savings account, while 20% would use their credit card. Eleven percent said they would have to borrow money from their friends, family, retirement or home equity (if they could get any) in order to pay for a $2,000 repair.
Slightly more Americans reported being able to pay for a $1,000 repair bill with 46% saying they could use savings and 22% turning to a credit card. But 14% would still have to borrow money from their friends, family, retirement or home equity.
