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If my math is right, you're at about $2500 for a serviceable car. That's very modest compared to payments on something newer. At this point, you will not get a better used car for $2500.
As with many used cars, it was probably neglected for a time and needed some sorting out. But I have a sense that the worst is over. It will need regular maintenance and repairs. In my experience, if you budget 5 cents for every kilometre you drive it, you probably won't be far off.
IMO, if the engine and transmission are good, the body is straight and sound, the interior is intact, and you like driving the car, keep going. I honestly don't think you will ever find anything more economical. But it's also a hobby; you've got to be involved with the car and learn about it, as you are obviously doing, or it will drive you crazy.
I gave up on my '89 740 at 509000 km because a valve spring broke, the headliner was gone, the AC compressor was failing, and the floor was starting to rot and need repair. However, up to that point maintenance costs had stayed fairly constant the entire time I owned the car. I thought it would get more costly as it got older, but it didn't - I simply found that different parts needed replacing.
I replaced it with a new Corolla . . . a mistake. We would've been much happier with another used Volvo.
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