Evaluate your Financial Condition.
You've probably got your trade paid off, or nearly paid off at least. Are you financially ready to take on payments again, or to stretch the payments out another three, five, or even seven years?
It's not simply comparing the costs that tell the whole story. Cost over time is a massive deal, and what you've got coming down the pipeline is important. Is there a promotion, or stepping up to a new job, on the horizon? Are you exploring the opportunities out there where you may need to make a longer daily commute? In that case, it just might be time to step up and trade your vehicle in for something newer, something that provides even more comfort and reliability for daily commuting.
Has your workplace been experiencing fluctuations, or have you seen stagnant pay rates recently? It might not be quite the right time to step into a new vehicle payment while trading in your current vehicle. Maybe treading water, and continuing to roll with your reliable lived-in vehicle, is the smarter choice at the moment.
Consider Depreciation.
Your used car has already weathered the highest depreciation it will see. Depreciation is not a straight line, it's a curve. That curve is steep during the first three years of the vehicle's life, then begins to bottom out as time continues. After five years, it gets better for you as the owner. From five to ten years is really the sweet spot for most vehicles - after the greatest depreciation, and before higher maintenance costs start to kick in. If you've made it through five or six years, going out to ten won't see a drastic depreciation.