Nothing lasts forever, and that's especially true of automobiles. There comes a point in every car's life when its owner must decide whether it's time for the body shop or time for the junkyard.

But when does that time come? An email sent by a Motley Fool reader typifies the dilemma:

I am the proud owner of a Ford mustang convertible with a new top. I have not had a car payment for nine years. With 185,000 miles on it, the car will soon need an overhaul, at $1,500 and another $500 in miscellaneous repairs. Should I put good money into my reliable old car or put the money in a newer used car?

Ah, yes, the don't-throw-good-money-after-bad rationale for buying a car. Any excuse for a new toy. But you have a convertible! Even if your car weren't the coolest toy on the road, when a safe and reliable old car meets your driving needs (you can trade it in for a minivan when the second kid arrives), there is rarely a good financial reason to get rid of it.

So, talking dollars and sense, let's look at the old car/new car debate. First, let's define an old car as one that just has a lot of miles under its hood. We're not talking about an unsafe car or a lemon that leaves you stranded by the side of the highway every other month, or a car that's been mistreated, crashed, or poorly built. Given a safe, well-maintained, functional older car, when does the cost of repairing it become a case of throwing good money after bad?

As long as the car can be kept safe and functional, the answer is "hardly ever." As expensive as repairs are these days -- and we have extensive personal knowledge of just how expensive they can be -- what's the alternative?

Car payments. Every month.

If you're trading in to avoid expensive repairs, you'll need to make a significant investment. That usually means substantial car payments -- payments that will hit you every month, not just occasionally like repairs. Here's one rule of thumb: Give up on an old car when the cost of known, necessary repairs (excluding regular maintenance) exceeds a year's worth of car payments for the replacement car. That's a pretty high hurdle.

Let's assume you would buy a nice but relatively modest used car and finance $10,000 for three years at 6%. That's going to cost you about $304 a month, or $3,648 a year. If you have a good, honest mechanic (keep looking, they are out there), it's pretty hard to spend more than that even if you blow the engine. Most years you will spend far less to keep an older car running.

Of course, if you wait until your car needs extensive repairs, it won't be worth much as a trade-in. That's a sticking point for some folks, but it might be just another "new toy" argument. Buy a newer car if you want one, but don't kid yourself into thinking it's for financial reasons.

If you want to blunt the pain of future repairs and offset the loss of trade-in value, start putting money away every month, at least half of what you would be spending on car payments. Earmark it for car repairs, and the next time the inevitable happens, you'll have the cash to cover it. With a little luck and good timing, that account may never be fully depleted and will one day make a nice down payment on the minivan. (Visit our Savings Center for good places for such cash.)

If you're still on the fence about your car, talk it over with the folks on the Buying and Maintaining a Car discussion board. Then, if you decide to buy, visit our Car Area for a no-haggle strategy on getting new wheels.