If you plan to keep you car for the long haul, you’re in good company.  Americans are hanging onto their cars longer than they used to. The average age of a traded-in car went from 4.32 years old in 2004 to 5.95 years old in 2009, according to Auto Observer. Autoweek reports that in 2009, 59 percent of new car buyers planned to keep their cars for more than four years, up from 45 percent in 2008.

But, at some point, your old car will require more time and money than it’s worth. Here are a few tips to know when it’s time to give your car the boot and when you should hang on to it.

It’s All About the Benjamins

Putting your old car out of its misery can be tough, but sometimes it’s a smart financial decision. Don’t let your memories and emotional attachment get in the way of saving some cash.

First, if your old car is nickel and diming you to death with small repairs, it’s time for a new model. Even if your car never needs a big fix, replacing smaller things like a water pump, head gasket or the air conditioning adds up quickly. Your car might end up being worth more as a trade-in if it runs well than as a black hole for your hard-earned money.

For example, a 1996 BMW 318i convertible with 150,000 miles that needs a new head gasket and new front and rear wheel bearings could cost as much as $4,327 to fix, according to RepairPal. Fixing these problems would cost the same as 15 months of payments on a new Chevrolet Cruze Sedan 1LT, which starts at $18,425. This is assuming you get a Kelley Blue Book “Excellent” trade-in value of $2,500 plus 2.9 percent financing and a loan term of 60 months. Even with 4.5 percent financing from your credit union, your monthly payments will be $297. One year of those payments is still less than the repairs the BMW needs. If your mechanic predicts that your 318i will need these repairs within in the next 14 months, trading it in and buying the new Cruze is a wise choice.

But, personal finances determine whether or not you can buy a new car. Other than monthly payments, you’ll have your loan rate to negotiate and tax, titling and registration fees to pay. If finances are tight, it may be worth it to spend some cash for repairs now and wait until your budget is in order. If you pay your bills on time and watch your credit, extra time will help you get a better deal on a car loan from your dealer or a credit union in the future.

Keeping Your Car on the Road

If your car still runs and gets you safely from A to B, it might not be time to head to the dealership. If your car just feels out of date or lacks some features you’d like, you should hang on to it. Many times, these problems can be remedied at a good price. If your 2000 Toyota Camry doesn’t have an iPod jack, and you’re sick of toting around that big CD binder, you can buy a kit that will add an iPod jack and have it installed for a few hundred dollars. That’s about the same price as titling and registration would cost on a new car, and you won’t have to worry about monthly payments. Or, if you’re looking for a navigation system, buying a handheld unit can cost less than $100. Factory-installed navigation systems in a new car usually cost more than $1,000, and in some cases will cost upwards of $2,500.

You might also be thinking of a new car because your lifestyle has changed. Maybe your Chrysler Sebring worked well when you children were small, but now they’re old enough to take skiing or on long vacations. If you’ve got the money, go ahead and upgrade. But if you want to save, you may be able keep your Sebring. For that vacation in the mountains that makes you yearn for four-wheel drive, you could trade cars with an accommodating friend for a week. If you need a minivan to tote around visitors who occasionally come to town, it’s cheaper to rent it for the week than to buy it. You can rent a Chrysler Town & Country from Hertz for one week for around $325.49, or about $46.50 per day. While that sounds like a lot, a monthly payment on a 2011 Town & Country with no down payment or trade-in, 4.5 percent APR and a 36-month loan is about $897. Paying $325 a few times a year is far cheaper than paying $897 every month for three years, especially if your old car is paid off and works fine.

Whenever most of us have had a car for a while, it starts to look a little shabby. If you want to restore your Mazda Miata to its former glory, but don’t need a new car, consider getting your car detailed. This can cost $75 and up, but it can leave your car looking and smelling like new. Small scratches, cracks and crevices full of gunk and pet hair are all taken care of, and you won’t be embarrassed on your carpool days.

Whether you decide to repair and refurbish or get rid of your car altogether and buy a new one, you can sit back, relax, and enjoy the upgrade you’ve made. At least for a little while.