The repair vs. replace decision guide
Don’t throw good money after bad. Use data-backed formulas to decide if your equipment is worth the fix.
The formula
The famous “$5,000 rule”
A simple financial formula HVAC and plumbing professionals use to determine the “remaining value” of a system.
Age × repair cost = result
If the result is greater than 5,000, replacement is usually the better call.
Example calculation
Decision: replace
The “50% rule” alternative
If the $5,000 rule feels too complex, many professionals use the 50% threshold: if a repair cost exceeds 50% of a new unit’s value, it’s rarely worth fixing.
This is especially true for appliances like water heaters or washers, where total replacement cost is relatively low compared to the labor of a major repair.
When to ignore the rules
- •Warranty: the part is covered by a manufacturer warranty.
- •Obsolete parts: parts are no longer manufactured for your unit.
- •Refrigerant: your AC uses R-22 (Freon) — replacement is almost always the answer.
At a glance
System decision matrix
Typical lifespans and “replace” thresholds for major home systems.
| System type | Avg. lifespan | “Replace” signal | Action |
|---|---|---|---|
| Central AC | 12–15 years | Compressor failure | View replacement costs |
| Water heater | 8–12 years | Tank leak / rust | View repair costs |
| Furnace | 15–20 years | Cracked heat exchanger | View repair costs |
| Roof (shingle) | 20–25 years | Multiple leak points | Coming soon |
Ready to check the numbers?
Explore our specific cost guides to see what a repair or replacement will cost in your area.